Deck 16: Marketing in the Global Environment Global Marketing

Question 1

Promoting international monetary cooperation and facilitating the expansion and growth of international trade, is the primary purpose of the:

A)General Agreement on Tariffs and Trade.
B)European Union.
C)World Bank Group.
D)International Monetary Fund.
E)World Trade Organization.

Answer 1

D

Question 2

The policies of a country aimed at encouraging global trade and marketing are referred to as:

A)protectionist policies.
B)trade sanctions.
C)trade liberalization policies.
D)tariffs.
E)import quotas.

Answer 2

C

Question 3

Which of the following, when levied on imported goods, artificially raises their price thereby lowering their demand in the local markets?

A)tariffs
B)boycotts
C)quotas
D)embargo
E)exchange rates

Answer 3

A

Question 4

The United States restricts its allies from trading with Libya.This type of restriction imposed by the government is known as:

A)a tariff.
B)a quota.
C)a duty.
D)an embargo.
E)exchange control.

Question 5

Which of the following designates the maximum quantity of a product that may be brought into a country during a specified time period?

A)tariff
B)embargo
C)duty
D)exchange rate
E)quota

Question 6

The procurement of goods and services by manufacturers from around the globe to take advantage of national differences in the cost and quality of various factors of production is referred to as:

A)homeshoring.
B)inshoring.
C)offshoring.
D)outsourcing.
E)restructuring.

Question 7

Which of the following is a method used by countries to avoid an unfavourable exchange rate?

A)franchising
B)licensing
C)exporting
D)countertrade
E)unique bid auction

Question 8

The policies of a country aimed at restricting trade and global marketing are called policies.

A)trade liberalization
B)free trade
C)protectionist
D)pricing
E)fair trade

Question 9

The penalties or restrictions imposed by one country over another country for importing and exporting of goods, services, and investments are called:

A)trade liberalization policies.
B)trade sanctions.
C)free trade policies.
D)pricing policies.
E)fair trade policies.

Question 10

A tax levied by the government on a good imported into a country is called a(n):

A)quota.
B)trade agreement.
C)embargo.
D)exchange rate.
E)tariff.

Question 11

The employees of a firm refusing to continue employment with a foreign firm or buy products from the firm on account of conflicts between the union and the employer is an example of a(n):

A)tariff on the goods.
B)embargo imposed by the government.
C)boycott called by the union.
D)method of avoiding an unfavourable exchange rate.
E)quota used to minimize foreign goods.

Question 12

Which of the following provides loans, policy advice, technical assistance, and knowledge- sharing services to low- and middle-income countries in an attempt to reduce poverty?

A)World Trade Organization
B)International Monetary Fund
C)World Bank Group
D)General Agreement on Tariffs and Trade
E)North American Free Trade Agreement

Question 13

Which of the following is a measure of how much one currency is worth in relation to another?

A)embargo
B)exchange rate
C)tariff
D)exchange control
E)quota

Question 14

A form of trade sanction that prohibits trading with a certain country or trading in specific goods by the signatory countries is called a(n):

A)tariff.
B)quota.
C)embargo.
D)trade agreement.
E)duty.

Question 15

Local retailers refusing to buy goods from a foreign textile firm in response to the firm's violation of labour laws is an example of a(n):

A)exchange control.
B)boycott.
C)tariff.
D)duty.
E)countertrade.

Question 16

The tax levied by the government on imported goods to make them more expensive and less competitive with domestic products is known as a(n):

A)quota.
B)tariff.
C)embargo.
D)trade agreement.
E)boycott.

Question 17

Which of the following was established to lower trade barriers, such as high tariffs on imported goods and restrictions on the number and types of imported products that inhibited the free flow of goods across borders?

A)GATT
B)NAFTA
C)CAFTA
D)WTO
E)ASEAN

Question 18

Which of the following can benefit domestically made products by reducing the availability of imported merchandise?

A)duties
B)tariffs
C)quotas
D)embargo
E)boycotts

Question 19

The primary purpose of IMF is to:

A)provide technical assistance and knowledge sharing services to low- and middle-income countries in an attempt to reduce poverty.
B)concentrate on poverty reduction through low-interest loans and other programs.
C)provide interest free loans based on sovereign guarantees.
D)promote international monetary cooperation and facilitate the expansion and growth of international trade.
E)provide insurance against political risks.

Question 20

The WTO differs from GATT in that GATT:

A)is an established institution based in Geneva that oversees the functioning of global markets.
B)is an organization that deals with global rules of trade among nations.
C)was established to assist developing countries with their trade policy issues through technical assistance and training.
D)is a forum for trade negotiations, settling trade disputes and reviewing trade policies.
E)was established to lower trade barriers that inhibited the flow of goods across borders.

Question 21

Which of the following is limited to trade-related issues among Canada, Mexico, and United States?

A)EU
B)NAFTA
C)CAFTA
D)ASEAN
E)FTAA

Question 22

Which of the following occurs when a country imports more goods than it exports?

A)currency crisis
B)trade deficit
C)countertrade
D)trade surplus
E)trade sanctions

Question 23

Which of the following is made up of countries that have signed a particular trade agreement?

A)trade sanction
B)embargo
C)trading bloc
D)trade union
E)fair trade area

Question 24

Firms prefer to manufacture in countries that have , as it provides an opportunity to export to more markets.

A)trade surplus
B)trade sanctions
C)trade deficit
D)import quotas
E)export duties

Question 25

Which of the following trade agreements represents the highest level of integration across individual nations?

A)NAFTA
B)CAFTA
C)EU
D)GATT
E)ASEAN

Question 26

Which of the following was created by the Mercosur member nations, primarily in response to NAFTA?

A)FTAA
B)CAFTA
C)ASEAN
D)GATT
E)EU

Question 27

Costa Rica and the Dominican Republic are members of:

A)NAFTA.
B)CAFTA.
C)FTAA.
D)ASEAN.
E)Mercosur.

Question 28

The trade agreement among Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and the United States is called:

A)NAFTA.
B)FTAA.
C)EU.
D)CAFTA.
E)ASEAN.

Question 29

The group of members who have signed a major agreement like the European Union can be called a(n):

A)trading bloc.
B)labour council.
C)embargo.
D)trade union.
E)labour union.

Question 30

Which of the following trading blocs is responsible for stimulating economies in its Southeast Asian member countries by lowering trade barriers and allowing higher levels of foreign investment?

A)FTAA
B)CAFTA
C)ASEAN
D)GATT
E)EU

Question 31

Which of the following countries is a member of the European Union?

A)Denmark
B)Argentina
C)Brazil
D)Norway
E)Croatia

Question 32

France decides to offer its finished clothing in exchange for packaged drinking water from the Belgium.This is an example of:

A)exporting.
B)direct investment.
C)licensing.
D)franchising.
E)countertrade.

Question 33

Which of the following is defined as the market value of goods and services produced by a country in a year?

A)human development index
B)gross national product
C)purchasing power parity
D)gross national happiness
E)gross domestic product

Question 34

Argentina, Brazil, Paraguay, Uruguay, and Venezuela are members of the trading bloc.

A)NAFTA
B)CAFTA
C)EU
D)ASEAN
E)Mercosur

Question 35

Which of the following trading blocs was originally formed to promote security in Southeast Asia during the Vietnam War?

A)NAFTA
B)CAFTA
C)EU
D)ASEAN
E)Mercosur

Question 36

The trade between two countries where goods are traded for other goods and not for hard currency is known as:

A)exporting.
B)countertrade.
C)licensing.
D)franchising.
E)greenfield venturing.

Question 37

Brazil exchanged coffee for aircraft parts with a British aircraft manufacturer instead of cash.This is an example of:

A)joint venture.
B)franchising.
C)countertrade.
D)licensing.
E)direct investment.

Question 38

Which of the following results when a country exports more goods than it imports?

A)trade deficit
B)trade sanctions
C)trade gap
D)trade surplus
E)countertrade

Question 39

Canada is a member of:

A)the European Union.
B)the North American Free Trade Agreement.
C)the Central America Free Trade Agreement.
D)the Association of Southeast Asian Nations.
E)Mercosur.

Question 40

Which of the following is an intergovernmental agreement designed to manage and promote trade activities for specific regions?

A)countertrade
B)exchange control
C)embargo
D)trade agreement
E)GATT

Question 41

Which of the following is a composite measure of life expectancy at birth, educational attainment, and whether the average incomes are sufficient to meet basic needs of life in a country?

A)GDP
B)GNP
C)HDI
D)GNH
E)PPP

Question 42

The dimension of culture that refers to the extent to which the dominant values in a society are male-oriented is called:

A)power distance.
B)individualism.
C)time-orientation.
D)uncertainty avoidance.
E)masculinity.

Question 43

A clothing company wants to explore new markets to increase sales of its clothing line.It has identified Kenya as a potential new market but wants to initially look at a low-risk, low-return option to assess the market.Which of the following entry strategies is the most suitable for the firm?

A)strategic alliance
B)franchising
C)joint venture
D)direct investment
E)exporting

Question 44

Which of the following market entry strategies requires the least financial risk but also allows for only a limited return to the firm?

A)strategic alliance
B)direct investment
C)joint venture
D)exporting
E)franchising

Question 45

Which of the following is a market entry strategy in which the parent company allows a host country firm to use its name and format and to operate its business in their market?

A)exporting
B)franchising
C)strategic alliance
D)joint venture
E)direct investment

Question 46

According to Geert Hofstede, the dimension of power distance refers to:

A)the extent to which society relies on formalized procedures to address situations that arise in daily life.
B)the perceived obligation to and dependence on groups.
C)short-term versus long-term orientation.
D)the extent to which dominant values are male-oriented.
E)the willingness to accept social inequality as natural.

Question 47

The Economist's Big Mac Index is a measure that employs to assess the relative economic buying power among nations.

A)GDP
B)GNP
C)HDI
D)GNH
E)PPP

Question 48

Which of the following factors of Geert Hofstede's cultural dimensions concept have to be considered by firms when they conduct a socio-cultural analysis of a country's market?

A)exchange control
B)distribution channels
C)population growth
D)power distance
E)transportation

Question 49

Which of the following is defined as the basic facilities, services, and installations needed for a community or society to function?

A)commerce
B)technology
C)infrastructure
D)power distance
E)development

Question 50

According to Geert Hofstede, the dimension of individualism refers to:

A)the extent to which society relies on formalized procedures to address situations that arise in daily life.
B)the perceived obligation to and dependence on groups.
C)short-term versus long-term orientation.
D)the extent to which dominant values are male-oriented.
E)willingness to accept social inequality as natural.

Question 51

The market entry strategy in which a firm entering a new market pools its resources with those of a local firm to form a new company in which ownership, control, and profits are shared is called:

A)licensing.
B)a joint venture.
C)a strategic alliance.
D)direct investment.
E)a franchising agreement.

Question 52

CREDAI serves a group of member hospitals that are located in many countries.The partnering members do not invest in each other's institutions, but CREDAI coordinates with members on mutual interests, helping them create value through collaboration.This is an example of:

A)exporting.
B)franchising.
C)a joint venture.
D)a strategic alliance.
E)direct investment.

Question 53

Which of the following approaches involves producing goods in one country and selling them in another?

A)franchising
B)exporting
C)strategic alliance
D)direct investment
E)joint venture

Question 54

Which of the following is the extent to which the society relies on orderliness, consistency, structure, and formalized procedures to address situations that arise in daily life?

A)power distance
B)individualism
C)time-orientation
D)uncertainty avoidance
E)masculinity

Question 55

A popular fast-food chain decides to enter the foreign market by allowing a local food chain to produce and market its products in return for a fee.This type of entry strategy is known as:

A)franchising.
B)exporting.
C)strategic alliance.
D)joint venture.
E)direct investment.

Question 56

Which of the following is an example of direct exporting?

A)a paint manufacturing company allows a local manufacturer to produce its paint products by licensing its technology
B)a lab equipment manufacturer in Korea sells its products through a local retail chain in India
C)a company exporting gems in India sells its gems through a jewellery retailer in Australia
D)a kitchen boutique sells its kitchen appliances in the host country by using its own retail outlets
E)a British company sells its machinery to a Canadian manufacturer who is licensed to
Produce and market goods in that country

Question 57

A collaborative relationship between independent firms in which the partnering firms do not create an equity partnership is called:

A)a strategic alliance.
B)a franchising agreement.
C)a joint venture.
D)direct investment.
E)indirect exporting.

Question 58

A popular ice cream chain enters a new market in another country by allowing local retailers to market its products, including the use of its brand name and format.This form of entry strategy into a new market is known as:

A)strategic alliance.
B)direct investment.
C)joint venture.
D)exporting.
E)franchising.

Question 59

The theory that states that if the exchange rates of two countries are in equilibrium, a product purchased in one will cost the same in the other, expressed in the same currency is referred to as:

A)gross domestic product.
B)human development index.
C)purchasing power parity.
D)gross national product.
E)potential output.

Question 60

Which of the following is an example of indirect exporting?

A)an Australian company allows a local firm in China to use its technical know-how in producing a product
B)an American fast-food chain allows a local chain of restaurants to operate its business in
India
C)a South Korean electronics firm sells its televisions through a local electronics retailer in the host country
D)a British company sells its machinery to a Canadian manufacturer who is licensed to produce and market goods in that country
E)a Korean chemical company allows a Japanese company to reproduce the chemical
Product in the local Japanese market

Question 61

The entry strategy that requires the highest levels of investment and exposes firms to significant risks is:

A)direct investment.
B)joint venture.
C)franchising.
D)licensing.
E)strategic alliance.

Question 62

A food manufacturing firm in Australia develops NutriBars, a snack which is popular in its domestic markets.The firm introduced this product in Japan as part of its globalization strategy.The product had to be transported to various small outlets across Japan to make it available to larger target markets, and this involved additional intermediaries that added cost and led to an increase in the final price of the product.These cost factors influenced the firm's:

A)global advertising strategy.
B)global distribution strategy.
C)global product strategy.
D)global communication strategy.
E)global service strategy.

Question 63

The type of entry strategy chosen by the construction firm is:

A)exporting.
B)franchising.
C)a joint venture.
D)direct investment.
E)a strategic alliance.

Question 64

An American pharmaceutical company produces medicines using a formula and technology from an Indian biotechnology company.The medicines are to be sold in the Indian market.The contract is based on the agreement that the formula for the product will be handled by the Indian firm.This is an example of:

A)management contracting.
B)strategic alliance.
C)contract manufacturing.
D)exporting.
E)direct investment.

Question 65

Why is determining the selling price in the global marketplace an extremely difficult task?

A)Many countries still have rules governing the competitive marketplace, including those that affect pricing.
B)The major challenge is identifying the elements that need to be adapted to be effective in the global marketplace.
C)Distribution can be challenging in some countries if the transportation infrastructure is inadequate.
D)Differences in language, customs, and culture also complicate marketers' ability to communicate with customers in various countries.
E)The number of firms with which the seller needs to deal to get its merchandise to the
Consumer determines the complexity of a channel.

Question 66

A financial services firm enters a new market by combining its resources with a local firm in a foreign country.The firm enters into this alliance because the local firm can provide it with a greater understanding of the market.This entry strategy employed by the firm is called:

A)licensing.
B)a joint venture.
C)a strategic alliance.
D)direct investment.
E)a franchising agreement.

Question 67

Firms consider market size and population growth rate when they analyze:

A)technology and infrastructure capabilities.
B)the economic environment.
C)socio-cultural factors.
D)the political environment.
E)the legal environment.

Question 68

Lanco Infratech bought the Australian mining company Griffin Coal and now runs a 100- percent owned mining entity in Australia.This venture has allowed Lanco complete control over the local market.This strategy is an example of:

A)strategic alliance.
B)exporting.
C)direct investment.
D)franchising.
E)joint venture.

Question 69

A joint venture differs from direct investment in that direct investment:

A)is formed when a domestic firm provides management consulting to a foreign firm.
B)requires a foreign firm to maintain complete ownership of its facilities in the foreign country.
C)is formed when a foreign firm contracts with a local firm in the host market to manufacture a product.
D)is a low-risk method of entering a country's market without setting up operations in the country.
E)generates returns immediately upon execution of the agreement.

Question 70

An entry strategy in which a firm maintains complete ownership of its plants, operational facilities, and offices in a foreign country is called:

A)a strategic alliance.
B)a joint venture.
C)franchising.
D)licensing.
E)direct investment.

Question 71

Global STP is more complicated than domestic STP because firms considering global expansion have difficulty understanding the:

A)political situations in other countries.
B)cultural nuances of other countries.
C)economic environment of foreign countries.
D)technological situations in other countries.
E)population distribution in foreign countries.

Question 72

A cement manufacturing firm decides to invest in China.To gain more profits the company decides to invest independently in the new market by setting up its own plants and distributing its products through its own sales force.This type of entry strategy is known as:

A)strategic alliance.
B)exporting.
C)joint venture.
D)franchising.
E)direct investment.

Question 73

A Canadian firm allows a local firm in Singapore to use its technology to manufacture products and sell them in Singapore.This is an example of:

A)management contracting.
B)a strategic alliance.
C)contract manufacturing.
D)an exporting agreement.
E)direct investment.

Question 74

Michael's Pizza, a popular pizza outlet in Europe is entering the Indian market as part of its globalization program.The firm decides to develop unique Indian flavours to cater to consumers in India.The cultural difference between the two markets is influencing the
Strategy of the firm.

A)product
B)pricing
C)communication
D)distribution
E)promotion

Question 75

The strategy developed by Zest to sell in the new market in the above scenario is a:

A)global promotion strategy.
B)global pricing strategy.
C)global distribution strategy.
D)global product strategy.
E)global communication strategy.

Question 76

By assessing the new market's communication, commerce, and transportation factors, the company analyzed:

A)the political environment.
B)the economic environment.
C)socio-cultural factors.
D)technology and infrastructure capabilities.
E)the legal environment.

Question 77

The entry strategy that offers firms complete control over their operations in a foreign country is:

A)franchising.
B)joint venture.
C)direct investment.
D)exporting.
E)strategic alliance.

Question 78

The type of entry strategy used by Zest is:

A)joint venture.
B)franchising.
C)exporting.
D)direct investment.
E)strategic alliance.

Question 79

A gaming console developed by a U.S.technology firm is priced at $500 in the United States.The firm markets a modified version of the product in the Indian market to decrease its costs and cater to low-income consumers.The factor that is influencing the product strategy of the firm is:

A)economic development.
B)cultural differences.
C)media availability.
D)trade sanctions.
E)currency fluctuations.

Question 80

A shoe manufacturing company in Canada wants to pursue global marketing.As part of its globalization, it decides to diversify its products and add leather bags, belts, and other accessories to its product list while entering the local markets in Brazil.Since it has no experience with these new products and little knowledge of local markets, it forms a contract with a local firm in Brazil to produce its products by providing resources and technology to the firm.This is an example of:

A)a strategic alliance.
B)a joint venture.
C)an exporting arrangement.
D)a franchising agreement.
E)direct investment.