Deck 2: Outsideusa Strategic Planning

Question 1

The various opportunities and threats that face multinational corporations are almost limitless,and the number and complexity of these factors ________ the number of products and the number of geographic areas served.

A)decrease dramatically with
B)dramatically increase with
C)drop slightly with
D)are constant despite
E)are unaffected by

Answer 1

B

Question 2

Discuss union membership across Europe.

Answer 2

Union membership in Europe ranges from 74 percent of employees in Finland to 8 percent in France.Percentage of membership is not the only indicator of strength,though.In France,for example,unions have repeatedly shown that despite low membership,they are able to mobilize workers in mass strikes and demonstrations to great effect.The average level of union membership in the European Union,weighted by the numbers employed in the different member states,is 23 percent compared to about 11 percent in the United States.High rates of union membership in Nordic countries reflect an approach that sees union membership as a natural part of employment.Central and Eastern European nations generally have below average levels of union membership.Union membership levels are clearly trending downward in Europe.The two exceptions appear to be Ireland and Italy where union membership is slowly growing.

Question 3

________ is a process of doing business worldwide,so strategic decisions are made based on global profitability of the firm rather than just domestic considerations.

A)Multinational corporation
B)Protectionism
C)Globalization
D)Assimilation
E)World recession

Answer 3

C

Question 4

The U.S.government's OPIC

A)offers insurance to offset some risks of doing business internationally.
B)provides insurance to eliminate all of the risks of doing business internationally.
C)is a leading source of humanitarian aid worldwide.
D)requires that paperwork be filed by U.S.companies desiring to do business internationally.
E)discourages foreign companies from doing business in the United States.

Question 5

Which of the following is a European country in which union membership is growing?

A)Australia
B)Austria
C)France
D)Italy
E)Sweden

Question 6

In an industry that is,or is rapidly becoming global,the riskiest possible posture is to

A)become a global competitor.
B)remain a domestic competitor.
C)remain a global competitor.
D)expand beyond the role of domestic competitor.
E)none of the above

Question 7

The ________ competitive opportunities and threats that face a multinational corporation are almost limitless.

A)social
B)cultural
C)environmental
D)political
E)all of the above

Question 8

List some of the diverse and unique risks that face multinational corporations (MNCs).

Question 9

Discuss some things firms can do to diminish the risk of doing business internationally.

Question 10

The strategic-management process for multinational firms is ________ for purely domestic firms,but the process is ________ for the purely domestic firms.

A)conceptually the same as;more complex
B)conceptually the same as;more simple
C)conceptually different than;more simple
D)conceptually different than;more complex
E)conceptually the same;less important

Question 11

In Nordic countries Denmark,Sweden,and Finland,about 70 percent of all employees are in unions.

Question 12

Multinational corporations face unique and diverse risks,which include all of the following EXCEPT

A)favorable foreign court interpretations of contracts and agreements.
B)currency losses through exchange rate fluctuations.
C)social/political disturbances.
D)import/export restrictions.
E)tariffs.

Question 13

Translations to and from most mainstream languages such as English,Spanish,French,German,and Chinese can be done with online programs but still not done easily.

Question 14

The average level of union membership across the whole of the European Union,weighted by the numbers employed in the different member states,is close to 25 percent.

Question 15

Mass communication and high technology have ________ in diverse cultures worldwide.

A)created similar patterns of consumption
B)resulted in highly individualized patterns of consumption
C)rendered patterns of consumption identical
D)had little to no effect on patterns of consumption
E)ignored patterns of consumption

Question 16

In today's global climate,many companies may find it difficult to survive by relying solely on domestic markets.

Question 17

Communication between domestic headquarters and overseas operations is often made difficult by

A)geographic distance.
B)cultural differences.
C)variations in business practices.
D)national differences.
E)all of the above

Question 18

A global strategy means considering individual countries distinctly when designing,producing,and marketing products.

Question 19

Organizations that conduct business operations across national borders are called

A)protectionists.
B)national firms.
C)multinational corporations.
D)domestic companies.
E)all of the above

Question 20

The average level of union membership across the whole of the European Union,weighted by the numbers employed in the different member states,is ________ percent compared to about ________ percent in the United States.

A)11;23
B)15;44
C)23;11
D)51;26
E)70;30

Question 21

Mass communication and high technology have led to highly individualized and distinct patterns of consumption in diverse cultures worldwide.

Question 22

Organizations that conduct business operations across national borders are called international firms or multinational corporations.

Question 23

It is an exaggeration to say that in an industry that is global,the riskiest possible posture is to remain a domestic competitor.

Question 24

________ can enable firms to learn the technology,culture,and business practices of other people and to make contacts with potential customers,suppliers,creditors,and distributors in foreign countries.

A)Economies of scale
B)Joint ventures
C)Low-cost production facilities
D)Reduced tariffs
E)Domestic operations

Question 25

The strategic-management process is more complex for international firms due to more variables and relationships.

Question 26

One of the dangers of remaining a local competitor is that more aggressive companies will use their global growth to capture economies of scale and learning.

Question 27

Strengths of competitors in foreign lands are often ________,and weaknesses are often ________.

A)overestimated;overestimated
B)overestimated;underestimated
C)underestimated;underestimated
D)underestimated;overestimated
E)none of the above

Question 28

All of the following are potential advantages to initiating,continuing,and/or expanding international operations EXCEPT

A)firms can gain new customers for their products.
B)foreign operations can absorb excess capacity,reduce unit costs,and spread economic risks over a wider number of markets.
C)foreign operations can allow firms to establish low-cost production facilities in locations close to raw materials and/or cheap labor.
D)foreign operations could be seized by nationalistic factions.
E)foreign operations may result in reduced tariffs,lower taxes,and favorable political treatment.

Question 29

As long as the price and quality of a firm's products and services are competitive on a local basis,it has nothing to worry about.

Question 30

With the rise in world commerce,government regulatory bodies are no longer able to closely monitor foreign business practices.

Question 31

The strategic-management process is conceptually different for multinational firms than for purely domestic firms.

Question 32

More time and effort are required to identify and evaluate external trends and events in domestic corporations than in multinational corporations.

Question 33

The social,cultural,demographic,environmental,political,governmental,legal,technological,and competitive opportunities and threats that face a multinational corporation are almost limitless.

Question 34

Which of the following is a potential advantage of conducting international operations?

A)Competitors in foreign markets may not exist,or competition may be less intense than in domestic markets.
B)Dealing with two or more monetary systems can complicate international business operations.
C)Differing language,culture,and value systems can make communication difficult.
D)Gaining an understanding of regional organizations is difficult but is often required in doing business internationally.
E)All of the above

Question 35

All of the following are potential disadvantages to initiating,continuing,or expanding business across national borders EXCEPT

A)firms confront different social,cultural,and political forces when doing business internationally,which can make communication in the firm difficult.
B)keeping informed about the number and nature of competitors is more difficult when doing business internationally.
C)foreign operations can absorb excess capacity,reduce unit costs,and spread economic risks over a wider number of markets.
D)dealing with two or more monetary systems can complicate international business operations.
E)foreign operations could be seized by nationalistic forces.

Question 36

Geographic distance and cultural differences are two of the factors that can make communication between domestic headquarters and overseas operations difficult.

Question 37

A firm's power and prestige in domestic markets may be significantly enhanced if it competes globally

A)which can translate into improved negotiating power among important groups.
B)though this rarely results in a practical advantage.
C)but this can hurt its bargaining power with suppliers and distributors.
D)yet this does nothing to improve its position with creditors.
E)which can alienate the firm from its domestic creditors,suppliers,and distributors.

Question 38

While multinational corporations face almost limitless social,cultural,demographic,environmental,political,governmental,legal,technological,and competitive opportunities and threats,the number and complexity of these factors do not dramatically increase with the number of products produced and the number of geographic areas served.

Question 39

Before entering international markets,firms should do research to try and diminish the risk of doing business in new markets.

Question 40

Trade barriers are one of the unique and diverse risks that face multinational corporations.

Question 41

Which of the following statements is NOT true?

A)America's economy is becoming much less American.
B)A world economy and monetary system are emerging.
C)Corporations in every corner of the globe are taking advantage of the opportunity to obtain customers globally.
D)Markets are shifting slowly and in many cases diverging in tastes,trends,and prices.
E)Innovative transport systems are accelerating the transfer of technology.

Question 42

Potential advantages to initiating,continuing,or expanding international operations is that foreign operations can absorb excess capacity,reduce unit costs,and spread economic risks over a wider number of markets.

Question 43

U.S.firms doing business internationally face the complications of having to deal with two or more monetary systems.

Question 44

Language,culture,and value systems differ among countries,which can create barriers to communication and problems managing people.

Question 45

Strategists in multinational corporations are often confronted with the need to be globally competitive and nationally responsive at the same time.

Question 46

In which of the following industries is the United States NOT yet greatly challenged by foreign competitors?

A)Auto industry
B)Electronics
C)Manufacturing
D)Retailing
E)None of the above

Question 47

What percent of the world's population lives outside the United States?

A)55
B)65
C)75
D)85
E)95

Question 48

Although growth in revenues and profits is a common expectation of shareholders,it is not a measure of organizational success.

Question 49

Perhaps the greatest advantage of international operations to a firm is the ability to gain new customers for its products and services,thus increasing revenues.

Question 50

Keeping informed about the number and the nature of competitors is easier when doing business internationally.

Question 51

The availability,depth,and reliability of economic and marketing information in different countries vary extensively.

Question 52

It is possible to obtain insurance from the U.S.Government's OPIC to eliminate all risks associated with doing business internationally.

Question 53

Foreign revenue as a percentage of total company revenues ________ in hundreds of U.S.firms,including ExxonMobil,Gillette,Dow Chemical,and Citicorp.

A)is almost 10 percent
B)approaches 20 percent
C)is 25 percent
D)exceed 50 percent
E)is at least 70 percent

Question 54

A motivation for initiating international operations is that competitors in foreign markets may not exist,or competition may be less intense than in domestic markets.

Question 55

Most economists argue that protectionism ________ the world economy because it ________ trade among countries.

A)helps;inhibits
B)helps;encourages
C)harms;inhibits
D)harms;encourages
E)doesn't impact;doesn't affect

Question 56

The portion of the world's population that lives outside of the United States is growing ________ the U.S.population.

A)30 percent slower than
B)70 percent slower than
C)30 percent faster than
D)70 percent faster than
E)at the same rate as

Question 57

Weaknesses of competitors in foreign lands are often underestimated,and strengths are often overestimated.

Question 58

List at least five potential advantages to initiating,continuing,and/or expanding international operations.

Question 59

Although a firm's power and prestige in domestic markets may be significantly enhanced when the firm competes globally,this rarely translates into improved negotiating power among creditors,suppliers,or distributors.

Question 60

Discuss at least four potential disadvantages to initiating,continuing,and/or expanding international operations.

Question 61

The domestic food industry ________,so Kraft Foods is focusing on foreign acquisitions.

A)is falling 5 percent per year
B)is falling 1 percent per year
C)is stagnant
D)is growing 3 percent per year
E)is growing 7 percent per year

Question 62

________ countries are market leaders in labor-intensive industries and ________ offers abundant natural resources and rapidly developing markets.

A)East Asian;Brazil
B)South American;Germany
C)East Asian;Germany
D)South American;Brazil
E)European;Japan

Question 63

Most economists argue that protectionism harms the world economy because it inhibits trade among countries and invites retaliation.

Question 64

Approximately what percent of the world's population lives in the United States?

A)5
B)10
C)15
D)85
E)95

Question 65

Nearly 70 percent of the world's population lives outside of the United States.

Question 66

Protectionism involves all of the following EXCEPT

A)tariffs against firms outside the country.
B)imposing taxes on firms outside the country.
C)imposing regulations on firms outside the country.
D)liberalizing restrictions on the import of foreign goods.
E)Protectionism involves all of the above.

Question 67

Foreign banks currently operate and compete in most parts of the United States.

Question 68

Joint ventures and partnerships between domestic and foreign firms are

A)falling out of favor.
B)increasingly difficult to engineer.
C)the exception rather than the rule.
D)extremely commonplace.
E)subject to too many regulations to be feasible.

Question 69

Brazil offers skilled labor and technology,while Germany offers abundant natural resources and rapidly developing markets.

Question 70

A primary reason why most domestic firms are engaging in global operations is that growth in demand for goods and services outside the United States is considerably higher than inside.

Question 71

Protectionism refers to countries imposing tariffs,taxes,and regulations on firms outside the country to favor their own companies and people.

Question 72

Joint ventures and partnerships between domestic and foreign firms are becoming the exception rather than the rule.

Question 73

Foreign revenue as a percentage of total company revenues is approaching 20 percent for Colgate-Palmolive.

Question 74

Labor markets have become steadily more international with more and more countries around the world welcoming foreign investment and capital.

Question 75

American firms that seem insulated from foreign competition today may be vulnerable tomorrow.

Question 76

The lowest cost source for precision machinery is

A)Japan.
B)Sri Lanka.
C)Malaysia.
D)Europe.
E)Mexico.

Question 77

Which U.S.industry is already greatly challenged by foreign competitors?

A)Printing
B)Retailing
C)Retail banking
D)Consumer packaged goods
E)None of the above

Question 78

Which of the following U.S.industries is NOT yet greatly challenged by foreign competitors?

A)Aircraft manufacturing
B)Auto manufacturing
C)Heavy equipment manufacturing
D)Tire manufacturing
E)Furniture manufacturing

Question 79

The U.S.furniture manufacturing industry is not yet greatly challenged by foreign competitors.

Question 80

The drive to improve the efficiency of global business operations is leading to lesser functional specialization.