Question 1

The U.S.government limits the amount of sugar cane that is imported into the country.This is an example of a quota.

Accepted Answer

A quota is a limit on the amount of goods that can be imported into a country. The U.S. government does indeed place a quota on the amount of sugar cane that can be imported.

Question 2

Multinational companies typically begin the development of their global business with direct investment and continue using this strategy throughout the company's life span.

Accepted Answer

Multinational companies typically go through at least three stages in the development of their global business.High-tech businesses typically have four stages of development.

Question 3

The U.S.government prohibits the importation of Havana cigars because of political differences with Cuba.This is an example of an import exchange control.

Accepted Answer

This is an example of a boycott.

Question 4

Global marketing standardization assumes markets throughout the world are becoming more alike.

Accepted Answer

Global marketing standardization is based on the assumption that customers' needs and preferences are becoming more similar worldwide due to the influences of globalization, technology, and cultural exchanges. Companies adopting a standardized approach to marketing can benefit from economies of scale, increased brand recognition, and lower costs, but they also face some risks of ignoring local differences, cultural barriers, and regulatory requirements.

Question 5

Global trade has reached about $11 trillion a year.

Accepted Answer

According to the World Trade Organization (WTO), global trade was valued at $18.89 trillion in 2019.

Question 6

Vast differences in natural resources created international dependence and huge shifts of wealth.

Accepted Answer

Natural resources such as oil, diamonds, and minerals have greatly influenced international trade and created dependencies between nations, leading to disparities in wealth distribution. Some countries are rich in resources and have benefited greatly from exports, while others have had to rely on importing these resources, leading to economic imbalances.

Question 7

About 85 percent of U.S.companies export their products to other countries on a regular basis.

Accepted Answer

About 85 percent of all U.S.exports of manufactured goods are shipped by less than 10 percent of all manufacturing businesses.

Question 8

The same environmental factors that operate in the domestic market also exist internationally.These factors (culture,economic development,political and legal structure,demographics,and natural resources)should be examined regardless of the country.

Accepted Answer

The same environmental factors exist internationally and should be examined regardless of the country.

Question 9

To protect its local vodka industry,Russia allows foreign manufacturers to have only one percent of the Russian vodka market.This is an example of using tariffs to control foreign competition.

Accepted Answer

This is an example of using quotas to control foreign competition.

Question 10

Having a global vision means management recognizes and reacts to international marketing opportunities,is aware of threats from foreign competitors in all markets.

Accepted Answer

Having a global vision means being aware of and reacting to opportunities and threats in the global market, including those from foreign competitors in all markets.

Question 11

Even though it is not actively involved in global marketing,Hennessey Enterprises,a U.S.-based business,agreed to sell two thousand of its stress-reducing products to a distribution company in Norway.This would be an example of direct investment.

Accepted Answer

This is an example of exporting.

Question 12

The major disadvantage of licensing agreements is that international companies cannot maintain control over their licensees.

Accepted Answer

Two common ways of maintaining effective control over licensees are shipping one or more critical components from the United States or locally registering patents and trademarks to the U.S.firm.

Question 13

According to research done by the World Bank,countries with the greatest amount of business regulation foster the strongest economies.

Accepted Answer

Those with the least amount of business regulation foster the strongest economies.

Question 14

Licensing agreements reduce the risk for manufacturers and sometimes even remove the requirement for a manufacturer to produce its own product.

Accepted Answer

Licensing agreements allow manufacturers to license the rights to produce and sell a particular product from another company, thereby reducing the risk and cost of developing the product themselves. In some cases, a licensing agreement may completely eliminate the need for a manufacturer to produce its own product.

Question 15

The falling U.S.dollar makes the possibility of manufacturing in the United States more attractive than in the past.

Accepted Answer

When the U.S. dollar falls in value compared to other currencies, it becomes cheaper for foreign companies to manufacture and make investments in the United States. This increased affordability can make manufacturing in the United States a more attractive option, potentially leading to increased investment and job creation.

Question 16

GATT,NAFTA,and the EU are all examples of market groupings.

Accepted Answer

GATT and NAFTA are trade agreements,and the EU is a market grouping.

Question 17

The Uruguay Round of trade negotiations dramatically increased trade barriers worldwide.

Accepted Answer

It lowered trade barriers.

Question 18

NAFTA is the New American Foreign Trade Amendment,which allows for balanced trade with the European Union (EU).

Accepted Answer

NAFTA is the North American Free Trade Agreement,which creates a free-trade zone among Canada,the United States,and Mexico.

Question 19

Even if all parties to a global business transaction are fluent in a common language,other cultural factors could interfere with the communication process.

Accepted Answer

Cultural factors such as differences in communication styles, values, and behavior can affect the communication process even if a common language is used.

Question 20

While some countries have elements of both capitalism and socialism,most nations are at one political extreme or the other.

Accepted Answer

Rarely will a political environment be at one extreme or the other.Rather,elements of many systems are often present.

Quiz 5: Developing a Global Vision