Question 1

The criterion traditionally used to classify countries as developed or developing is per capita income.

Accepted Answer

Per capita income is one of the most commonly used criteria to categorize countries as developed or developing, along with factors such as human development, education, healthcare, and industrialization. However, some critics argue that this classification oversimplifies the complex socio-economic realities of different countries and can lead to stigmatization or discrimination.

Question 2

Some economic environments of business include resource and product markets,language,religion,and per capita income.

Accepted Answer

False

Question 3

Because of cheap labor,most international business firms are headquartered in the less developed countries of Asia and South America.

Accepted Answer

This statement is not necessarily true. While some international business firms may choose to establish headquarters in less developed countries for access to cheap labor, there are also many factors to consider such as infrastructure, government stability, and market demand. Additionally, many international business firms are still headquartered in developed countries such as the United States and European countries.

Question 4

Countertrade is the barter of products for products rather than the sale of products for currency.

Accepted Answer

Countertrade involves exchanging goods instead of using currency for payment.

Question 5

With exporting,the corporation transfers its products for sale and its production facilities in foreign countries.

Accepted Answer

With exporting, the corporation only transfers its products for sale to foreign countries, it does not transfer its production facilities.

Question 6

When Harbor Trades,a Korean-based company,makes resources including technology,managerial skills,and patent and trademark rights available to Nano Technologies,a Russian company whereby allowing Nano to make products similar to CBA,it is engaging in a countertrade agreement.

Accepted Answer

This is not a countertrade agreement. It is simply a partnership or agreement for Harbor Trades to provide resources to Nano Technologies. Countertrade agreements involve the exchange of goods or services of equal value, often between countries with different currencies or trade restrictions.

Question 7

A country's physical facilities that support economic activities make up its infrastructure.

Accepted Answer

Infrastructure includes things like roads, bridges, ports, airports, telecommunications networks, water and sewage systems, and energy networks, among others, all of which support economic activities.

Question 8

Seeking cheaper sources of materials or labor offshore is called offshoring.

Accepted Answer

Offshoring is the practice of seeking cheaper sources of materials or labor offshore.

Question 9

The countries experiencing political stability face the greatest threat of violence.

Accepted Answer

The statement is false. Countries experiencing political instability usually face a greater threat of violence, as there can be conflicts between different groups vying for power or resources, and a breakdown of law and order.

Question 10

Infrastructure management is the management of business operations conducted in more than one country.

Accepted Answer

Infrastructure management refers to the management of physical or digital infrastructure, such as buildings, roads, IT systems, and networks. It is not specifically related to operations conducted in multiple countries, although it could certainly apply in that context. However, the definition given in the question is overly broad and does not accurately reflect what infrastructure management entails.

Question 11

In today's world,every manager needs to think locally.

Accepted Answer

The answer of In today's world,every manager needs to think...

Question 12

Business has become a unified,global field as trade barriers fall,communication becomes faster and cheaper,and consumer tastes converge.

Accepted Answer

As globalization continues to accelerate, business has indeed become a unified, global field. Trade agreements and technological advancements have reduced trade barriers and improved communication, while the increasing interconnectedness of cultures has led to convergence in consumer preferences.

Question 13

An example of global outsourcing is seen when Gap,Inc.uses low-cost Caribbean labor to cheaply produce its clothing,and then finishes off and sells its clothing in the United States.

Accepted Answer

This statement accurately describes an example of global outsourcing where a company, Gap, Inc., utilizes low-cost labor in the Caribbean to produce clothing and then sells the finished products in a higher-cost market, the United States.

Question 14

An estimated 55 percent of world trade is countertrade.

Accepted Answer

According to the International Chamber of Commerce, countertrade represents less than 10% of world trade.

Question 15

LDCs are less developed countries and tend to be found in the Southern Hemisphere including Africa,Asia and South America.

Accepted Answer

LDCs are indeed less developed countries found in the Southern Hemisphere including Africa, Asia, and South America.

Question 16

The sub-divisions of the international environment are the economic,the sociocultural,and the legal-political environments.

Accepted Answer

The sub-divisions of the international environment are indeed the economic, sociocultural, and legal-political environments.

Question 17

Market risk is defined as the risk of loss of assets,earning power,or managerial control due to politically based events or actions by host governments.

Accepted Answer

Market risk is defined as the risk of loss due to changes in market conditions, economic factors, or other non-governmental factors. Political risk refers specifically to the risk of loss due to government actions or events.

Question 18

Outsourcing is perhaps the most widespread approach to international involvement in China and India.

Accepted Answer

Outsourcing is a common strategy adopted by companies from all over the world to establish their presence in China and India, taking advantage of the lower costs of production and labor. This has made China and India the two fastest-growing economies in the world.

Question 19

The basic management functions of planning,organizing,leading,and controlling are the same whether a company operates domestically or internationally.

Accepted Answer

The basic management functions of planning, organizing, leading, and controlling are universal and apply to all types of organizations regardless of whether they operate domestically or internationally. However, there are additional challenges and considerations that arise when operating in an international context, such as dealing with cultural differences, navigating different legal and regulatory frameworks, and managing global supply chains.

Question 20

The second stage in the process of globalization is the international stage,where the company usually adopts a multidomestic approach.

Accepted Answer

In the international stage of globalization, companies typically adopt a multidomestic approach, where they customize their products and services to meet the specific needs of each local market. This is different from the previous stage, which is the domestic stage, where companies focus solely on their home market.

Quiz 3: Managing in a Global Environment