Question 1

The business competence of an organization renders concepts like political stability and legal security irrelevant.

Accepted Answer

While business competence is an important aspect of success for an organization, factors like political stability and legal security play a crucial role in creating a conducive environment for business operations. Without these factors, an organization may face significant challenges and risks that can impact its success. Therefore, political stability and legal security are not irrelevant, but rather very important considerations for any organization.

Question 2

A PESTEL analysis helps managers gain a better understanding of the opportunities and threats they face.

Accepted Answer

PESTEL analysis examines political, economic, social, technological, environmental, and legal factors that may impact a company or industry, giving managers insight into both opportunities and threats.

Question 3

Managers also need to take into consideration the macroeconomic factors that will have near-term and long-term effects on the success of their strategy.

Accepted Answer

Managers must consider macroeconomic factors such as economic growth, inflation rates, and interest rates when developing and executing a strategy, as these factors can significantly impact the success of the strategy in the short and long term.

Question 4

Firms are more likely to be successful when they exploit a change in the environment rather than simply survive or oppose the change.

Accepted Answer

Exploiting a change in the environment can lead to opportunities for innovation and growth, whereas simply surviving or opposing the change may only result in maintaining the status quo or even decline. Therefore, firms that are able to successfully adapt and take advantage of changes in the environment are more likely to be successful.

Question 5

Product differentiation plays a critical role for companies entering a new market.

Accepted Answer

Product differentiation is a strategy used by companies to distinguish their products or services from those of their competitors. This is especially important when entering a new market where there may be established players. A company's unique features, brand, and value proposition helps it stand out to potential customers and gain a competitive advantage.

Question 6

In a truly global industry,the core product is standardized,the marketing approach is relatively uniform,and competitive strategies are integrated in different international markets.

Accepted Answer

In a truly global industry, companies often standardize their core product to leverage economies of scale, adopt a relatively uniform marketing approach to maintain brand consistency, and integrate competitive strategies across different international markets to optimize their global presence and efficiency.

Question 7

The advantage of exporting is that firms avoid the expense of establishing operations in the new country.

Accepted Answer

Exporting allows firms to sell their products or services in foreign markets without having to invest in establishing operations such as building facilities or hiring employees. This can be a cost-efficient way for companies to expand their international presence.

Question 8

An organization,when it is planning to expand in a foreign country,needs to view the country as a monolith.

Accepted Answer

It is important for the organization to view the foreign country as a diverse marketplace with unique cultural, economic, and political factors that should be considered in the expansion plan.

Question 9

The factors mentioned in the PESTEL framework are inter-related.

Accepted Answer

The PESTEL factors (political, economic, socio-cultural, technological, environmental, and legal) are interconnected and can influence each other. For example, a change in political policies can impact the economy, which can in turn affect social attitudes and behaviors. Therefore, the factors in the PESTEL framework cannot be fully understood in isolation from each other.

Question 10

When transportation costs and automation are both high,then the knowledge worker component of the location calculation becomes more important.

Accepted Answer

The answer of When transportation costs and automation are both...

Question 11

The rate of industry change remains relatively the same from one industry to the next in one financial year.

Accepted Answer

The rate of industry change can vary widely across different industries and can also change from year to year within the same industry.

Question 12

Organizations that promote coherent images and brands globally,realize economies of scope and scale.

Accepted Answer

Organizations that promote coherent images and brands globally can leverage economies of scope by sharing marketing and promotional materials across regions, as well as economies of scale by producing and distributing products and services globally.

Question 13

When an organization plans to expand in a foreign country,it needs to understand what the local consumers look for when making a purchase decision.

Accepted Answer

Understanding the local consumer behavior is vital for any organization planning to expand into a foreign market. This helps in developing suitable products, pricing, and marketing strategies.

Question 14

Home-market norms tend to remain the same over time irrespective of the shifting demographics due to immigration or aging populations.

Accepted Answer

Home-market norms may change over time due to factors such as immigration or aging populations influencing consumer preferences and behaviors.

Question 15

The Internet has made exporting easier as even small firms can access critical information about foreign markets,examine a target market,research the competition,and create lists of potential customers.

Accepted Answer

The statement is true as the internet has made it easier for small firms to access information and research foreign markets, competition, and potential customers.

Question 16

An organization,when it is expanding in a foreign country,enters it through a domestic partner.This would improve the chances of success for the organization.

Accepted Answer

By partnering with a domestic organization, the foreign organization can benefit from their knowledge of local laws, cultural norms, and business practices, leading to greater success in the foreign market.

Question 17

Market due diligence relies on published research on the markets rather than interviews with potential customers and industry experts.

Accepted Answer

Market due diligence involves both published research and interviews with potential customers and industry experts to gain a comprehensive understanding of the market.

Question 18

The more similar markets in different regions are,the lesser the pressure for an industry to globalize.

Accepted Answer

The answer of The more similar markets in different regions...

Question 19

Entrepreneurs and small businesses are most likely to avoid the use of exporting as a way to get their products into markets around the globe because the cost of exporting is higher than that of the other entry modes.

Accepted Answer

Exporting is often considered a cost-effective entry mode compared to others like establishing a physical presence, as it involves lower initial investment and risk.

Question 20

Political factors are irrelevant as far as consumer confidence,consumer,and business spending is concerned.

Accepted Answer

Political factors can have a significant impact on consumer confidence, consumer spending, and business spending. For example, changes in government policies, elections, and geopolitical events can all affect people's perception of the economy and their willingness to spend money.

Quiz 8: International Expansion and Global Market Opportunity Assessment