Question 1

A(n) __________ motive is to seize market opportunities in foreign countries through trade or investment.
A) defensive
B) offensive
C) forward
D) backward

Accepted Answer

An offensive motive in international business is about actively seeking and seizing market opportunities in foreign countries through trade or investment. This can involve entering new markets, launching new products or services, or acquiring local businesses or assets to gain market share. On the other hand, a defensive motive is about protecting existing market positions or defending against foreign competitors, while forward and backward motives refer to the location of value-added activities in the global value chain.

Question 2

Joan is highly concerned about the unpredictability of environmental or organizational conditions that affect her firm's performance. This is an example of
A) risk.
B) uncertainty.
C) hedging.
D) none of the above

Accepted Answer

Joan's concern about unpredictability indicates a lack of information or knowledge about the future events that could affect the performance of her firm. This type of situation is called uncertainty, which is different from risk because risk implies some knowledge or data about the probability of events occurring. Hedging refers to strategies or actions taken to reduce the impact of risks or uncertainties, but it is not applicable in this scenario.

Question 3

Harry is planning to expand abroad. Harry is concerned about the unpredictability of operational and financial outcomes. This is an example of
A) risk.
B) uncertainty.
C) hedging.
D) none of the above

Accepted Answer

Harry is concerned about the unpredictability of operational and financial outcomes, which is an example of risk.

Question 4

A firm that has directly invested abroad and has at least one working affiliate in a foreign country (e.g., a factory, a branch office) over which it maintains effective control, is defined as a
A) multinational enterprise.
B) domestic enterprise.
C) foreign enterprise.
D) none of the above.

Accepted Answer

A firm that has directly invested abroad and has at least one working affiliate in a foreign country is known as a multinational enterprise. This is because it operates in more than one country, with control over its foreign affiliates. A domestic enterprise operates only in its home country, while a foreign enterprise is a company that is based in a foreign country and does not necessarily have operations in its home country.

Question 5

_______________ occurs when the company invests resources in business activities outside its home country.
A) International trade
B) International investment
C) International services
D) Exchange of goods

Accepted Answer

International investment occurs when a company decides to invest its resources in business activities outside its home country. This can include investing in foreign countries, such as purchasing real estate or stocks, or establishing subsidiaries or branches in other countries to expand its business operations.

Question 6

_______________ include technology and innovation, organizational and managerial skills, and intellectual property rights such as copyrights, trademarks, and brand names.
A) Knowledge and skills
B) Goods
C) Services
D) All of the above

Accepted Answer

The options listed in the question, technology and innovation, organizational and managerial skills, and intellectual property rights, are all elements of knowledge and skills, which are essential for business success. Goods and services are more tangible elements of business, whereas knowledge and skills are intangible assets that contribute to a company's overall value.

Question 7

Example of services transferred internationally are
A) accounting and management.
B) legal counsel and insurance.
C) banking.
D) all of the above.

Accepted Answer

All of the above options are services that can be transferred internationally. Accounting and management can be outsourced to firms in other countries, legal counsel can be hired from international law firms, and banking services can be accessed through international banks or online platforms.

Question 8

____________ refers to business activities that involve the transfer of resources, goods, services, knowledge, skills, or information across national boundaries.
A) International business
B) Local Business
C) Domestic Business
D) None of the above

Accepted Answer

International business involves conducting business activities across national boundaries, which can include the transfer of resources, goods, services, knowledge, skills, or information. Domestic business refers to conducting business activities within the boundaries of a single country, while local business typically refers to conducting business within a specific geographic area, such as a city or region. None of the above is not correct as international business is the best choice for this definition.

Question 9

Globalization infrastructure is the institutional framework and market efficiency that supports fair and transparent transactions of products and services and streamline flows of commodities, ________, labor, knowledge, and information.
A) economy
B) society
C) culture
D) environment

Accepted Answer

Culture is one of the key components that globalization infrastructure supports, facilitating the exchange and integration of cultural elements across borders.

Question 10

Another complaint against globalization is that it comes at the expense of the ______________.
A) economy
B) society
C) culture
D) environment

Accepted Answer

Globalization can have negative impacts on the environment, such as pollution, deforestation, and climate change.

Question 11

Coca Cola's slogan, which is a good international business rule to follow, is
A) think locally and act globally.
B) think regionally and act locally.
C) think globally and act locally.
D) think globally and act globally.

Accepted Answer

Thinking globally allows a business to consider international trends, culture, and preferences, while acting locally shows respect for and understanding of the specific needs of each market. Coca Cola has been successful in many countries by tailoring its marketing and product offerings to fit local tastes and customs while retaining a consistent brand image worldwide.

Question 12

Piggybacking is a term used to describe a strategic move for firmsto follow the company's major customers abroad.

Accepted Answer

Piggybacking is indeed a term used to describe firms strategically following their major customers abroad.

Question 13

International business is the outgrowth of domestic business.

Accepted Answer

International business is the expansion of domestic business operations across different countries and regions. Therefore, it is a natural outgrowth of domestic business.

Question 14

One measure of globalization across various industries involves the industry's international linkages.

Accepted Answer

Globalization involves the integration and interdependence of economies and societies worldwide, which is often reflected in the international linkages of industries. This can include cross-border trade, foreign investment, and global supply chains, among other forms of international integration.

Question 15

Motorola has made it clear that it will not pursue the development, design, manufacturing and sales facilities in multiple countries.

Accepted Answer

Motorola has pursued development, design, manufacturing, and sales facilities in multiple countries over its history, adapting to global market demands and technological advancements.

Question 16

Variations in international currency exchange usually don't affect the costs of operation or profitability of international firms.

Accepted Answer

Variations in international currency exchange can affect the costs of operation and profitability of international firms, as changes in exchange rates can affect the prices of inputs, revenues from sales, and the value of assets and liabilities.

Question 17

International transactions are manifested mainly in international trade and investment.

Accepted Answer

International transactions mostly occur in the form of international trade and investment, involving the exchange of goods, services, and financial assets between countries. Other examples include tourism, foreign aid, and remittances sent by migrants.

Question 18

The principles that steer management of corporations are the same worldwide.

Accepted Answer

Although there may be commonalities in management principles across different countries, cultural, legal and economic factors often influence the way corporations are managed in different contexts. Therefore, variations in management practices across different countries are expected.

Question 19

Firm activities and exchanges that involve the crossing of national boundaries are called international transactions.

Accepted Answer

International transactions refer to economic interactions between businesses or individuals in different countries.

Question 20

International business is particularly attractive since the business environment with regard to currency, inflation, interest, accounting, culture, laws, and governmental regulation is very predictable.

Accepted Answer

The statement is false. The business environment in international business can be very unpredictable and can vary greatly between different countries and regions. Factors such as political instability, corruption, and changes in regulations can have a significant impact on the business environment. Additionally, cultural differences can also create challenges for businesses operating internationally.

Quiz 1: International Business in an Age of Globalization

A(n) __________ motive is to seize market opportunities in foreign countries through trade or investment.

Joan is highly concerned about the unpredictability of environmental or organizational conditions that affect her firm's performance. This is an example of

Harry is planning to expand abroad. Harry is concerned about the unpredictability of operational and financial outcomes. This is an example of

A firm that has directly invested abroad and has at least one working affiliate in a foreign country (e.g., a factory, a branch office) over which it maintains effective control, is defined as a

_______________ occurs when the company invests resources in business activities outside its home country.

_______________ include technology and innovation, organizational and managerial skills, and intellectual property rights such as copyrights, trademarks, and brand names.

Example of services transferred internationally are

____________ refers to business activities that involve the transfer of resources, goods, services, knowledge, skills, or information across national boundaries.

Globalization infrastructure is the institutional framework and market efficiency that supports fair and transparent transactions of products and services and streamline flows of commodities, ________, labor, knowledge, and information.

Another complaint against globalization is that it comes at the expense of the ______________.

Coca Cola's slogan, which is a good international business rule to follow, is