Question 1

Refer to the scenario below to answer the following questions.
Sharp & Trimmer, a maker of men's and women's razors and electric hair trimmers, had little reason to become involved in the global arena. But after acquiring Wei Man Enterprises, whose largest division engages in a licensing agreement with a Chinese firm to produce women's hosiery, managers at Sharp & Trimmer wondered just whether a company-wide global focus would be more profitable after all.
Managers at Sharp & Trimmer studied Wei Man's licensing agreement in great detail. Though seeing first-hand the benefits Wei Man found with the licensing agreement, managers decided that Sharp & Trimmer would target the Asian market merely via exporting.
With the assistance of a domestic export department, the Sharp & Trimmer razors and hair trimmers entered France. For six months, sales were mediocre. But after that, sales suffered. Opinions varied among numerous managers as to the cause of the failure. "Who knows the local market better than people who live there?" was a comment heard throughout Sharp & Trimmer. "Maybe we needed an alliance with an Asian firm, or a licensing agreement, before racing to get there."
-Based on the passage,Sharp & Trimmer entered the Asian market to gain which of the following benefits of global trade?
A) access to new consumer markets
B) access to less expensive labor
C) access to less expensive materials
D) access to foreign investment incentives
E) the ability to offset domestic economic cycles

Accepted Answer

Sharp & Trimmer entered the Asian market to target new consumer markets. The passage states that managers at Sharp & Trimmer decided to target the Asian market via exporting after acquiring a company with a licensing agreement in China. Additionally, the passage mentions that managers studied Wei Man's licensing agreement in great detail and saw the benefits it provided.

Question 2

Members of management at Growing Green,a company that markets organic and environmentally friendly gardening and landscaping supplies and equipment,are evaluating the benefits and disadvantages of indirect exporting,direct exporting,and licensing.In which stage of the international marketing process is Growing Green?
A) deciding whether to go global
B) deciding which markets to enter
C) deciding how to enter the market
D) deciding on the global marketing program
E) deciding on the global marketing organization

Accepted Answer

Growing Green is in the stage of deciding how to enter the market, which includes evaluating the different methods of market entry such as indirect exporting, direct exporting, and licensing.

Question 3

Which of the following would a defender of globalization most likely use as an example to argue that concerns of Americanization are overblown and that globalization is indeed a two-way street?
A) the view of McDonald's as a domestic brand in China
B) the growing popularity of coffee in China since the introduction of Starbucks
C) the growing number of IKEA furniture stores in the United States
D) the initial failure of Disneyland Paris
E) the anti-globalization protests aimed at KFC

Accepted Answer

The answer of Which of the following would a defender...

Question 4

A Chinese New Year television ad features a dragon in a holiday parade,adorned with red Coke cans.The spot concludes,"For many centuries,the color red has been the color for good luck and prosperity.Who are we to argue with ancient wisdom?" This is an example of ________.
A) communication adaptation
B) joint venturing
C) product invention
D) straight product extension
E) product adaptation

Accepted Answer

The ad is an example of communication adaptation because it uses cultural symbols and meanings (the color red and the dragon) to connect with the local audience, adapting the marketing message to fit cultural preferences and traditions.

Question 5

Think Ink is a growing company that sells a variety of inks for home and business printers.Management at Think Ink has decided to open a sales branch overseas to handle sales and distribution abroad.Think Ink is engaging in ________.
A) indirect exporting
B) direct exporting
C) licensing
D) joint ownership
E) management contracting

Accepted Answer

Direct exporting refers to a situation in which a company sells its products directly to customers in a foreign market. In this case, Think Ink is opening a sales branch overseas to handle sales and distribution abroad, which fits the definition of direct exporting.

Question 6

Heineken beer is sold successfully in about the same form around the world.This is an example of which product strategy?
A) product adaptation
B) straight product extension
C) product invention
D) dual adaptation
E) communication adaptation

Accepted Answer

Heineken's global success with almost the same form of their beer suggests that they have employed a straight product extension strategy. This means that they have kept their product the same across all markets, without any significant adaptations or changes based on cultural or regional differences.

Question 7

Which of the following is true regarding economic communities?
A) Trade barriers have increased between the United States and Mexico since NAFTA was created.
B) Tariffs are typically lower or nonexistent between countries in the community than between countries not in the community.
C) CAFTA represents the world's single largest market.
D) Converting numerous currencies into the euro has been a failure.
E) NAFTA was modeled after CAFTA.

Accepted Answer

Economic communities, such as the EU or NAFTA, aim to reduce trade barriers between member countries. This often includes lowering or eliminating tariffs between member countries, which is why choice B is true. Choices A, C, D, and E are all incorrect.

Question 8

Vidal Sassoon shampoos contain different amounts of scent according to what country they are sold in.This is an example of ________.
A) straight product extension
B) product invention
C) product adaptation
D) communication adaptation
E) standardized global marketing

Accepted Answer

The fact that Vidal Sassoon shampoos contain different amounts of scent based on the country they are sold in shows that the company has adapted their product to meet the preferences of different markets. This is an example of product adaptation.

Question 9

A company could conduct direct exporting in all of the following ways EXCEPT which one?
A) It can set up a domestic export department.
B) It can set up an overseas sales branch.
C) It can send home-based sales people abroad to find more business.
D) It can work through independent international marketing intermediaries.
E) It can hire foreign-based agents who sell goods on its behalf.

Accepted Answer

Direct exporting involves the company selling directly to the customer in the foreign market, whereas working through independent international marketing intermediaries involves indirect exporting.

Question 10

Nike faced a situation in a Muslim country with the stylized "Air" logo on its shoes.Muslims were offended because Nike's "Air" resembled "Allah" in Arabic script.This is an example of ________.
A) the impact of culture on marketing strategy
B) communication adaptation
C) product adaptation
D) adapted global marketing
E) product invention

Accepted Answer

This situation highlights the impact of culture on marketing strategy, specifically how cultural differences and nuances can affect consumer perception and reactions. It showcases the importance of understanding and adapting to cultural sensitivities in global marketing efforts.

Question 11

To make Oreo cookies sell well in China,Kraft completely altered the popular all-American classic to a long,thin,four-layered,chocolate-covered wafer.This is an example of ________.
A) product invention
B) straight product extension
C) product adaptation
D) dual adaptation
E) communication adaptation

Accepted Answer

The alteration of the Oreo cookie to a long, thin, four-layered, chocolate-covered wafer was a product adaptation, in which the product was changed to better suit the preferences and tastes of the Chinese market. This is different from a straight product extension, in which the same product is simply offered in a new market with no changes, and from product invention, in which an entirely new product is created. Dual adaptation and communication adaptation are not relevant to this scenario.

Question 12

At Comfort Homes,a manufacturer of furniture and home accessories,the global operating units report directly to the chief executive instead of a head of an international division.The company recruits management from many countries and buys components and supplies where they cost the least.Comfort Homes is most accurately classified as a(n)________.
A) direct exporter
B) geographical organization
C) international subsidiary
D) global organization
E) world product group

Accepted Answer

Comfort Homes' structure of direct reporting to the chief executive and global recruitment and sourcing indicate that it is a global organization, with a focus on worldwide operations and integration.

Question 13

Trusted Wholesalers is a company that currently purchases products produced in Mexico and sells them to companies based in the United States and Canada.Trusted Wholesalers is considering whether to also purchase products produced in Costa Rica and the Dominican Republic.To make their decision,members of management at Trusted Wholesalers will most likely closely evaluate the agreements made by ________.
A) the EU
B) NAFTA
C) CAFTA
D) MCAN
E) UNASUR

Accepted Answer

CAFTA stands for Central America Free Trade Agreement and includes Costa Rica and the Dominican Republic. Since Trusted Wholesalers is considering purchasing products from these two countries, it would make sense to closely evaluate the agreements made by CAFTA to better understand the trade regulations and potential benefits. The other options listed (EU, NAFTA, MCAN, UNASUR) do not include these two countries and would not provide relevant information for management's decision-making process in this scenario.

Question 14

Trusted Wholesalers is a company that purchases products produced in Mexico and sells them to companies based in the United States and Canada.Management at Trusted Wholesalers would most likely be interested in becoming experts in the agreements made by ________.
A) the EU
B) NAFTA
C) CAFTA
D) FTC
E) UNASUR

Accepted Answer

NAFTA stands for the North American Free Trade Agreement and is a trade agreement between the United States, Canada, and Mexico. As Trusted Wholesalers is purchasing products produced in Mexico and selling them to companies based in the United States and Canada, management would most likely be interested in becoming experts in the agreements made by NAFTA.

Question 15

Hershey recently linked with Indian-based Godrej Beverages and Foods to make and distribute its chocolates in that country.When it comes to selling chocolate in India,Hershey will need all the help it can from its new local partner.This is an example of which joint venture?
A) licensing
B) contract manufacturing
C) management contracting
D) joint ownership
E) indirect exporting

Accepted Answer

This scenario describes a joint ownership venture, where Hershey collaborates with Godrej Beverages and Foods to produce and distribute chocolates in India, sharing ownership and control.

Question 16

To maximize the toothpaste market in China,Crest needs to convince more of the Chinese population to brush their teeth.Which of the following would Crest be most likely to use to accomplish this?
A) product adaptation
B) straight product extension
C) communication adaptation
D) standardized global marketing
E) product invention

Accepted Answer

Communication adaptation would be the most effective way for Crest to persuade more of the Chinese population to brush their teeth, as it would allow them to tailor their marketing message to the cultural and linguistic nuances of the Chinese market. Product adaptation and invention may also be necessary to create toothpastes that meet the specific needs and preferences of Chinese consumers, but these changes would likely be secondary to the need for effective communication strategies. Straight product extension and standardized global marketing are unlikely to be effective in a market as diverse as China.

Question 17

The global name for Microsoft's operating system,Vista,turns out to be a disparaging term for a frumpy old woman in Latvia.Microsoft must adjust the name.This is an example of the need for ________.
A) communication adaptation
B) standardized global marketing
C) straight product extension
D) product adaptation
E) communication extension

Accepted Answer

Communication adaptation is needed to ensure that marketing messages are appropriate and effective in different cultural contexts, avoiding negative connotations.

Question 18

A Gucci handbag may sell for $60 in Italy and $240 in the United States.It must add the cost of transportation,tariffs,importer margin,wholesaler margin,and retailer margin to its factory price.Gucci faces a ________ problem.
A) dumping
B) tariff
C) licensing
D) product adaptation
E) price escalation

Accepted Answer

The problem faced by Gucci is price escalation, which refers to the increase in price as a product moves through different stages of the distribution channel. Gucci's handbag sells for a higher price in the United States due to the additional costs associated with transportation, tariffs, importer margin, wholesaler margin, and retailer margin. This results in a price escalation, making the product more expensive in the U.S. than in Italy.

Question 19

Companies such as Quaker Oats and Monsanto are researching the nutrition needs of different countries,creating new foods,and developing advertising campaigns to gain product trial and acceptance.This is an example of ________.
A) straight product extension
B) product invention
C) product adaptation
D) dual adaptation
E) communication adaptation

Accepted Answer

This is an example of product invention, as the companies are creating new foods to meet the specific nutrition needs of different countries.

Question 20

Refer to the scenario below to answer the following questions.
Sharp & Trimmer, a maker of men's and women's razors and electric hair trimmers, had little reason to become involved in the global arena. But after acquiring Wei Man Enterprises, whose largest division engages in a licensing agreement with a Chinese firm to produce women's hosiery, managers at Sharp & Trimmer wondered just whether a company-wide global focus would be more profitable after all.
Managers at Sharp & Trimmer studied Wei Man's licensing agreement in great detail. Though seeing first-hand the benefits Wei Man found with the licensing agreement, managers decided that Sharp & Trimmer would target the Asian market merely via exporting.
With the assistance of a domestic export department, the Sharp & Trimmer razors and hair trimmers entered France. For six months, sales were mediocre. But after that, sales suffered. Opinions varied among numerous managers as to the cause of the failure. "Who knows the local market better than people who live there?" was a comment heard throughout Sharp & Trimmer. "Maybe we needed an alliance with an Asian firm, or a licensing agreement, before racing to get there."
-If Sharp & Trimmer allowed an Asian company to produce and market razors and trimmers carrying the company's brand in exchange for a royalty,Sharp & Trimmer would be using which market entry strategy?
A) exporting
B) franchising
C) licensing
D) contract manufacturing
E) joint ownership

Accepted Answer

Licensing, as described in the scenario, involves a licensing agreement with a foreign firm to produce and market products under the company's brand, in exchange for a royalty. This is the market entry strategy that Sharp & Trimmer would be using if they allowed an Asian company to produce and market their razors and trimmers.

Quiz 19: The Global Marketplace

Which of the following would a defender of globalization most likely use as an example to argue that concerns of Americanization are overblown and that globalization is indeed a two-way street?

A Chinese New Year television ad features a dragon in a holiday parade,adorned with red Coke cans.The spot concludes,"For many centuries,the color red has been the color for good luck and prosperity.Who are we to argue with ancient wisdom?" This is an example of ________.

Think Ink is a growing company that sells a variety of inks for home and business printers.Management at Think Ink has decided to open a sales branch overseas to handle sales and distribution abroad.Think Ink is engaging in ________.

Heineken beer is sold successfully in about the same form around the world.This is an example of which product strategy?

Which of the following is true regarding economic communities?

Vidal Sassoon shampoos contain different amounts of scent according to what country they are sold in.This is an example of ________.

A company could conduct direct exporting in all of the following ways EXCEPT which one?

Nike faced a situation in a Muslim country with the stylized "Air" logo on its shoes.Muslims were offended because Nike's "Air" resembled "Allah" in Arabic script.This is an example of ________.

To make Oreo cookies sell well in China,Kraft completely altered the popular all-American classic to a long,thin,four-layered,chocolate-covered wafer.This is an example of ________.

Trusted Wholesalers is a company that purchases products produced in Mexico and sells them to companies based in the United States and Canada.Management at Trusted Wholesalers would most likely be interested in becoming experts in the agreements made by ________.

Hershey recently linked with Indian-based Godrej Beverages and Foods to make and distribute its chocolates in that country.When it comes to selling chocolate in India,Hershey will need all the help it can from its new local partner.This is an example of which joint venture?

To maximize the toothpaste market in China,Crest needs to convince more of the Chinese population to brush their teeth.Which of the following would Crest be most likely to use to accomplish this?

The global name for Microsoft's operating system,Vista,turns out to be a disparaging term for a frumpy old woman in Latvia.Microsoft must adjust the name.This is an example of the need for ________.

A Gucci handbag may sell for $60 in Italy and $240 in the United States.It must add the cost of transportation,tariffs,importer margin,wholesaler margin,and retailer margin to its factory price.Gucci faces a ________ problem.

Companies such as Quaker Oats and Monsanto are researching the nutrition needs of different countries,creating new foods,and developing advertising campaigns to gain product trial and acceptance.This is an example of ________.