Deck 6: Global Competitors

Question 1

For many years,European governments allowed their firms to engage in cartel behavior outlawed in the United States.

Answer 1

True

Question 2

Business groups are typically publicly owned companies and have a presence in one or two related industries.

Answer 2

False

Question 3

Due to the horizontal keiretsus system,most industries in Japan only have one or two major competitors.

Answer 3

False

Question 4

Many business groups in developing countries are actively seeking foreign multinational corporations to be joint venture partners.

Question 5

Business groups are evolving by restructuring around their strongest businesses and expanding into foreign markets.

Question 6

Multinational companies have a better understanding of local culture and are more effective in addressing consumer needs than local competitors.

Question 7

An investigation by Mexico's competition commission found Cemex guilty of monopolistic behavior.

Question 8

General Motors was forced to operate divisions as separate firms to guarantee fairness among competitors.

Question 9

Business groups in developing countries are currently going through a process of privatization.

Question 10

A dodger strategy focuses on developing new marketing and product strategies to stay ahead of competition.

Question 11

The keiretsus system forced member companies to be highly efficient and profitable,and loss-making companies were closed down.

Question 12

When BIC attacked Scripto in the United States,Scripto rapidly counterparried in France.

Question 13

State owned enterprises were established to generate large profits to fund government operations.

Question 14

In the Japanese horizontal keiretsus system,the keiretsu bank helps out members in times of trouble.

Question 15

Mexico's Cemex adopted a cross-country subsidization strategy and used its monopolistic position in Mexico to subsidize overseas operations.

Question 16

Counterparry refers to defending against a competitive attack in one country by counterattacking in another county.

Question 17

Identifying actual and potential global competitors and selecting an overall posture towards those competitors is called a globally coordinated counterparry.

Question 18

India is one country where privatization has gone quickly and proceeded smoothly.

Question 19

An extender strategy focuses on expanding into foreign markets similar to a firm's domestic market.

Question 20

Business groups are evolving by restructuring around their core competencies.

Question 21

Aerospace is an example of a global industry.

Question 22

A local firm often enjoys which advantage over a multinational corporation?

A)Larger size
B)Global brands
C)Better knowledge of local markets
D)Easier access to credit

Question 23

Fuji Film versus Kodak is an example of

A)global firm versus global firm.
B)multidomestic firm versus domestic firm.
C)global firm versus local firm.
D)local firm versus local firm.

Question 24

Cross-country subsidization refers to

A)using profits in one country to subsidize prices in another.
B)subsidiaries operating independently of each other.
C)national governments providing subsidies to local companies.
D)national governments providing subsidies to foreign investors.

Question 25

The United States established anti-trust laws to

A)encourage monopolies.
B)drive competitors out of the markets.
C)create large corporations.
D)discourage monopolies and encourage competition.

Question 26

Consumer ethnocentrism refers to the belief that foreign-made products are usually lower quality than domestically produced products.

Question 27

A global product rollout is an example of a

A)cross-country subsidization.
B)multidomestic strategy.
C)globally coordinated move.
D)counterparry.

Question 28

When many European e-tailers chose to sell out to U.S.competition,they could be said to following a ____ strategy.

A)takeover
B)dodger
C)defender
D)counterparry

Question 29

Carpets from Iran enjoy a positive country-of-origin effect.

Question 30

Country of origin denotes the country with which a firm is associated-typically its home country.

Question 31

A multinational corporation usually enjoys which advantage over a local firm?

A)Ability to utilize cross-country subsidization.
B)Easier access to credit
C)Larger size
D)All of the above

Question 32

A contender strategy is one in which

A)a company expands into similar foreign markets.
B)a company focuses on leveraging local assets.
C)companies seek out niches under-served by their competitors
D)companies avoid competition by finding a way to cooperate with competition.

Question 33

Local competitors possess an advantage over global competitors because they

A)have a better access to sources of finance.
B)have greater worldwide experience in product development.
C)understand the local culture and have established relationships with local distributors.
D)All of the above.

Question 34

A country-of-origin bias is only observed among buyers of consumer goods and not among buyers of industrial goods.

Question 35

Top Indian retailers upgraded their operations to world-class standards in response to

A)privatization.
B)socialization.
C)nationalization.
D)the threat of Wal-Mart entering the Indian market.

Question 36

Which market do Coke and Pepsi consider to be a major growth market?

A)India
B)China
C)Russia
D)All of the above

Question 37

Strong global brands can easily overcome a negative country-of-origin bias.

Question 38

A defender strategy is one in which

A)a company expands into similar foreign markets.
B)a company focuses on leveraging local assets in market segments where MNCs are weak.
C)companies seek out niches under-served by their competitors.
D)a firm avoids competition by finding a way to cooperate with competition.

Question 39

Consumer animosity is usually short lived and results in little business disruption after a few months.

Question 40

Televisa's decision to enter foreign markets and target Spanish speaking audiences is an example of a(n)____ strategy.

A)contender
B)dodger
C)defender
D)extender

Question 41

Steel is an industry that requires heavy financial investment and enjoys substantial economies of scale.Which strategy might be appropriate for an Indian steel producer?

A)Contender
B)Defender
C)Subsidizer
D)Extender

Question 42

Heinz's ABC brand of soy sauce in Indonesia lost market share to the local Bango brand because

A)of consumer animosity.
B)of consumer ethnocentrism.
C)Bango better understood the local market.
D)Unilever bought the Bango brand.

Question 43

Privatization occurs when

A)governments acquire privately held firms.
B)privately held firms go public.
C)SOEs are sold to private-sector firms.
D)None of the above.

Question 44

State-owned enterprises may enjoy certain advantages over private-sector firms in developing countries including

A)privatization.
B)ancillary agendas.
C)protection against bankruptcy.
D)freedom from government interference.

Question 45

Pharmaceuticals is an industry with high R&D costs and relatively similar consumer needs worldwide.Which strategy might be appropriate for an Indonesian pharmaceutical firm?

A)Extender
B)Dodger
C)Defender
D)Coordinator

Question 46

Horizontal keirestus are common phenomena in which country?

A)China
B)Vietnam
C)Mexico
D)Japan

Question 47

Business groups emerged as the major local competitors in

A)the United States.
B)Europe.
C)Japan.
D)developing countries.

Question 48

Which of the following refers to biases concerning the quality of foreign products?

A)Consumer ethnocentrism
B)Stable animosity
C)Situational animosity
D)None of the above

Question 49

In Europe,anti-trust laws are established primarily to

A)protect consumers.
B)guarantee fairness among competitors.
C)lower prices and keep competitors out.
D)All of the above.

Question 50

Consumer animosity refers to the belief that

A)foreign made products are usually lower quality than domestically produced products.
B)foreign made products are always lower quality than domestically produced products.
C)foreign products should not be purchased because doing so takes jobs away from locals.
D)None of the above

Question 51

In response to the MNC threat,business groups are

A)restructuring around their strongest business and expanding into foreign markets.
B)expanding horizontally.
C)lobbying governments to provide them with more subsidies.
D)None of the above.

Question 52

When consumers are biased against foreign products because they believe that buying imported goods results in job loss locally,this is called

A)consumer animosity
B)situational animosity
C)consumer ethnocentrism
D)social protection reflex

Question 53

Business groups are characterized by their

A)monopolistic position.
B)financial core.
C)global presence.
D)public ownership.

Question 54

Similar to ____,business groups have a financial core.

A)Japanese keiretsus
B)SOEs
C)multinational corporations
D)start-ups

Question 55

Pharmaceuticals is an industry with high R&D costs and relatively similar consumer needs worldwide.Which strategy might be appropriate for a Greek pharmaceutical firm?

A)Dodger
B)Defender
C)Extender
D)All of the above

Question 56

Identify the business group from the following list of companies:

A)Pepsi
B)General Motors
C)Xerox
D)Tata

Question 57

Which of the following would enjoy a positive country-of-origin effect?

A)Wine from France
B)Automobiles from Mexico
C)Perfume from Korea
D)Vodka from England

Question 58

As a nation,France is renown for

A)carpets.
B)perfumes.
C)design.
D)engineering quality.

Question 59

In developing countries,governments may limit competition by

A)market liberalization.
B)licensing local production.
C)anti-trust laws.
D)All of the above.

Question 60

Steel is an industry that requires heavy financial investment and enjoys substantial economies of scale.Which strategy might be appropriate for a South Korean steel producer?

A)Extender
B)Defender
C)Indicator
D)Dodger

Question 61

A distributor of Indian films is planning to export to the United States and will be targeting Indians living in America.The firm is pursuing a(n)

A)ethnic dodger strategy.
B)ethnic contender strategy.
C)defender strategy.
D)extender strategy.

Question 62

Indimart,a chain of supermarkets,is a member of an Indian business group.Which other business is the group most likely to be involved in?

A)Computers
B)Packaged foods
C)Airlines
D)It is impossible to tell.

Question 63

Ato Corporation,a member of a Japanese horizontal keiretsu,has been experiencing poor sales and no profits for three years.What can it expect?

A)Ato will survive because the Japanese market is relatively uncompetitive.
B)The keiretsu bank will restrict credit to Ato.
C)Japan will allow it to cartel with competitors.
D)None of the above

Question 64

A producer of traditional Lebanese foods is planning to export to the United States and will be targeting Lebanese and other Arabs living in America.The firm is pursuing a(n)

A)defender strategy.
B)extender strategy.
C)contender strategy.
D)ethnic acquisition strategy.

Question 65

Taberet is a family-owned company in Germany.As such it is

A)unusual.
B)allowed to participate in cartels.
C)forced to think short-term.
D)None of the above

Question 66

A producer of Chinese herbal medicines is planning to export to the United States and will be targeting Chinese living in America.The firm is pursuing a(n)

A)extender strategy.
B)defender strategy.
C)contender strategy.
D)ethnic dodger strategy.

Question 67

A privately owned Brazilian steel firm is planning a contender strategy.Its owners should

A)identify MNCs that might want to buy their company.
B)identify foreign countries with many Brazilian immigrants.
C)identify foreign countries with many South American immigrants.
D)consider taking the company public to raise funds.

Question 68

A privately owned Thai chemical firm is planning a contender strategy.Its owners should

A)consider taking the company public to raise funds.
B)identify foreign countries with many Thai immigrants.
C)identify foreign countries with many Asian immigrants.
D)identify MNCs that might want to buy their company.

Question 69

Indopharm is a state-owned pharmaceutical firm in Indonesia.Indonesia has lifted quotas that previously protected its domestic pharmaceutical market.Indopharm must now compete in a climate of

A)privatization.
B)market liberalization.
C)national trade coordination.
D)global trade coordination.

Question 70

Afritelecom is a state-owned enterprise in a sub-Saharan African country.Forty-nine percent of Afritelecom has recently been sold to a local business group.This is an example of

A)a cartel arrangement.
B)expropriation.
C)privatization.
D)a private extension policy.

Question 71

Cathay Corporation produces packaged foods and is a member of a Thai business group.Which other business is the group most likely to be involved in?

A)Grocery stores
B)Steel
C)Software design
D)It is impossible to tell.

Question 72

Taberet is a family-owned company in Germany.As such it is

A)required to join a cartel.
B)not forced to think short-term.
C)unusual.
D)All of the above

Question 73

A major U.S.-based pharmaceutical MNC is planning a merger with a major German-based pharmaceutical MNC.The takeover is likely to be more difficult legally in

A)the USA.
B)the EU.
C)neither country because laws are similar in both countries.
D)neither country because the target is an MNC.

Question 74

A major European chemical company is planning a merger with a major U.S.-based chemical company.The merger is likely to prove more difficult legally in

A)Japan.
B)USA.
C)EU.
D)There will be no differences among these regions.

Question 75

A privately owned Indian pharmaceutical firm is planning a contender strategy.Its owners should

A)identify foreign countries with many Indian immigrants.
B)identify MNCs that might want to buy their company.
C)consider taking the company public to raise funds.
D)All of the above

Question 76

A privately owned Thai chemical firm is planning a dodger strategy.Its owners should

A)identify MNCs that might want to buy their company.
B)consider taking the company public to raise funds.
C)identify foreign countries with many Thai immigrants.
D)All of the above

Question 77

A producer of Mexican wines is planning to export to the United States and will be targeting Mexicans living in America.The firm is pursuing a(n)

A)defender strategy.
B)extender strategy.
C)contender strategy.
D)dodger strategy.

Question 78

A privately owned Indian pharmaceutical firm is planning a dodger strategy.Its owners should

A)identify MNCs that might want to buy their company.
B)identify foreign countries with many Indian immigrants.
C)consider taking the company public to raise funds.
D)All of the above

Question 79

A privately owned Brazilian steel firm is planning a dodger strategy.Its owners should

A)identify foreign countries with many Brazilian immigrants.
B)identify foreign countries with many south American immigrants.
C)consider taking the company public to raise funds.
D)identify MNCs that might want to buy their company.

Question 80

Ato Corporation,a member of a Japanese horizontal keiretsu,has been experiencing poor sales and no profits for three years.What can it expect?

A)Ato will survive because the Japanese market is relatively uncompetitive.
B)The keiretsu bank will continue to support the ailing firm.
C)Japan will allow Ato to cartel with competitors.
D)A hostile takeover of Ato is likely.