Question 1

Long hours of work and poor working conditions are prevalent in sweatshops.

Accepted Answer

Sweatshops are characterized by long hours of work (often exceeding 12 hours per day) and poor working conditions such as low wages, lack of benefits, overcrowding, and dangerous or unhealthy working conditions.

Question 2

Executives of transnationals view the entire world as their domain for acquiring resources.

Accepted Answer

Transnational corporations have a global reach and operate in multiple countries to acquire resources, expand their markets and increase profitability. They often view the world as a source of raw materials, cheap labor, and potential consumers.

Question 3

Culture shock is the tendency to view one's culture as superior to other cultures.

Accepted Answer

Culture shock refers to the feelings of confusion and uncertainty that can occur when a person is suddenly exposed to a new, unfamiliar culture, way of life, or set of attitudes. It does not specifically involve viewing one's own culture as superior.

Question 4

The use of child labour has been effectively eliminated as an ethical issue that faces managers of MNCs.

Accepted Answer

Child labour continues to be a significant ethical issue that faces managers of MNCs, particularly in developing countries where regulations may be more lax and poverty may force families to send their children to work. Although progress has been made in reducing the prevalence of child labour, it is still a significant problem that requires ongoing attention and action from MNCs.

Question 5

Culture is the shared set of beliefs, values, and patterns of behaviour common to a group of people.

Accepted Answer

Culture is defined as a shared set of beliefs, values, and patterns of behavior that are unique to a particular group of people.

Question 6

Host-country complaints about multinational corporations (MNCs) include foreign exchange restrictions, pressure to buy raw materials at inflated prices, failure to protect intellectual property, and failure to uphold contracts.

Accepted Answer

These are common complaints that host countries have lodged against MNCs.

Question 7

Extraction of excessive profits by global corporations is a potential host-country cost.

Accepted Answer

Global corporations may extract excessive profits from the host country, which can lead to a negative impact on the economy, including decreased competitiveness and financial instability.

Question 8

Knowledge about foreign cultures is known as cultural intelligence.

Accepted Answer

Cultural intelligence refers to the ability to understand and effectively adapt to different cultural contexts. It involves knowledge, skills, and attitudes that facilitate cross-cultural interaction and communication.

Question 9

Sustainable development places greater importance on the needs of the present generation than on the needs of future generations.

Accepted Answer

Sustainable development aims to meet the needs of the present generation without compromising the ability of future generations to meet their own needs. Therefore, it places equal importance on the needs of both present and future generations.

Question 10

Technology transfer, capital development, increased employment opportunities, and the development of local resources are benefits that host countries can obtain from relationships with multinational corporations.

Accepted Answer

Host countries can benefit from technology transfers and capital development that multinational corporations can bring in. These can help create new employment opportunities and develop local resources, leading to economic growth.

Question 11

In the United States, the Foreign Corrupt Practices Act makes it illegal for U.S. firms to engage in U.S. corrupt practices overseas.

Accepted Answer

The Foreign Corrupt Practices Act (FCPA) prohibits U.S. companies from engaging in bribery or corrupt practices overseas.

Question 12

Transnational corporations seek integration of their operations, operating across borders without home-based prejudices, and making major decisions from a global perspective.

Accepted Answer

Transnational corporations aim to operate without limitations of national boundaries and develop a global outlook for decision-making.

Question 13

SADC links 14 countries of Southeast Asia in trade and economic development efforts.

Accepted Answer

SADC stands for Southern African Development Community and links 16 countries in Southern Africa in trade and economic development efforts.

Question 14

Citizens of many nations are putting increased pressure on global corporations to protect the natural environment, pursue safe industrial practices, and pursue sustainable development.

Accepted Answer

This statement is true as there is a rising global concern among citizens for the protection of the environment, safe industrial practices and sustainable development, which is putting pressure on corporations to act more responsibly.

Question 15

Multinational corporations are often criticized at home for diverting labour-intensive jobs from the domestic labour force to foreign labour markets, diverting capital investments away from the domestic market, and encouraging corrupt practices in their foreign subsidiaries.

Accepted Answer

Multinational corporations have been criticized for these reasons, as they focus on maximizing profits and may prioritize their foreign operations over the domestic market. However, it should be noted that they also bring in foreign investment, create jobs in foreign markets, and may contribute to technology transfer and skill development in local communities.

Question 16

Ethnocentrism is the confusion or discomfort that someone may experience when in an unfamiliar culture.

Accepted Answer

Ethnocentrism is not a confusion or discomfort, but rather an attitude or belief in the superiority of one's own culture. It can lead to a lack of understanding or respect for other cultures.

Question 17

When large multinationals gain disproportionately from the forces of globalization, while smaller firms and countries do not, there occurs what is referred to as a "globalization gap."

Accepted Answer

This statement is true as the globalization gap refers to the uneven distribution of benefits and opportunities that result from globalization, where larger multinational corporations tend to benefit more than smaller firms and developing countries.

Question 18

In Canada, the Corruption of Foreign Public Officials Act makes it illegal for Canadian firms and their representatives to engage in corrupt practices overseas.

Accepted Answer

The Corruption of Foreign Public Officials Act (CFPOA) was enacted in Canada in 1998, and it makes it illegal for Canadian firms and their representatives to engage in corrupt practices overseas, including offering bribes or other forms of inducements to foreign officials to obtain or retain business. Violators can face significant fines and even imprisonment.

Question 19

Transnational corporations have a domestic perspective yet operate across borders and make multinational decisions.

Accepted Answer

Transnational corporations operate across borders and make multinational decisions, but they do not have a purely domestic perspective; instead, they integrate and adapt their operations and strategies to the various international environments in which they operate.

Question 20

Nigel is very proud of his British culture and tends to view other cultures as potentially inferior to his own. This is an example of ethnocentrism.

Accepted Answer

Ethnocentrism refers to the tendency to believe that one's own culture is superior to others. Nigel's view of his own culture as superior to others is an example of ethnocentrism.

Quiz 5: Global Management and Cultural Diversity