Question 1

The process of growing interdependence among elements of the global economy is known as _____________.

Accepted Answer

The answer of The process of growing interdependence among elements...

Question 2

The most common multinational organizational structures are done by product and area.

Accepted Answer

Multinational companies commonly use a combination of product-based and geographic-based structures to organize their global operations.

Question 3

In a global economy,resources,markets and competition are worldwide in scope.

Accepted Answer

In a global economy, resources, markets and competition are not limited to a particular region or nation, but extend across the world. This means that companies and individuals have access to a wider range of resources, customers and potential competitors than in a localized economy.

Question 4

For all practical purposes,a multinational corporation is the same as a transnational corporation.

Accepted Answer

A multinational corporation (MNC) operates in multiple countries but has a centralized management system, usually in its home country, whereas a transnational corporation (TNC) spreads out its operations across multiple countries and does not prioritize any one location, often decentralizing management to be more responsive to local markets.

Question 5

One of the challenges to international business is the cultural relativism forced upon them by local laws and customs.

Accepted Answer

Cultural relativism is the principle that an individual's beliefs and activities should be understood in terms of their own culture. Local laws and customs are often influenced by cultural beliefs, thus making it necessary for international businesses to respect and adapt to these cultural differences, which can be a challenge.

Question 6

In global sourcing,firms purchase and sell goods and services around the world for local use.

Accepted Answer

Global sourcing involves purchasing and selling goods and services around the world for use in different countries, not for local use.

Question 7

The Foreign Corrupt Practices Act can actually put U.S.firms at a competitive disadvantage in certain areas of the world.

Accepted Answer

This is true because some countries do not have strict anti-bribery laws like the Foreign Corrupt Practices Act and companies from those countries may be more willing to engage in bribery to win business over U.S. firms that are restricted by the law. This can create an uneven playing field and put U.S. firms at a disadvantage.

Question 8

Host countries always complain that MNCs do not have respect for local customs.

Accepted Answer

While some host countries may have complaints about MNCs (Multinational Corporations) not respecting local customs, it is not accurate to say that host countries always complain about this issue. Many MNCs make significant efforts to adapt to and respect local customs and regulations in the countries where they operate.

Question 9

Currency risk means that the amount you actually receive for your sale of products or services may vary depending on currency fluctuations.

Accepted Answer

Currency risk is the risk that changes in exchange rates will affect the amount of money you receive or have to pay for goods or services. The amount received or paid may be more or less than originally anticipated due to currency fluctuations. Therefore, the statement "Currency risk means that the amount you actually receive for your sale of products or services may vary depending on currency fluctuations" is true.

Question 10

A foreign subsidiary can be created either by buying out an existing firm or by building a new firm from scratch.

Accepted Answer

This is true, a foreign subsidiary can be created either through acquisition or through establishing a new firm.

Question 11

Domestic franchising involves selling the right to use your name and operating methods to foreign companies.

Accepted Answer

Domestic franchising refers to selling the right to use your name and operating methods to companies within your country. International franchising involves selling the right to use your name and operating methods to foreign companies.

Question 12

A foreign subsidiary is a local operation in which a foreign firm owns at least 51%.

Accepted Answer

The answer of A foreign subsidiary is a local operation...

Question 13

The form of international business involving the sale of domestically made goods in foreign markets is called _____________.

Accepted Answer

The answer of The form of international business involving the...

Question 14

Importing involves buying goods from foreign companies for sale overseas.

Accepted Answer

Importing involves buying goods from foreign companies for sale within one's own country, not overseas.

Question 15

There are 90 members in the World Trade Organization.

Accepted Answer

As of my last update in 2023, there are 164 members in the World Trade Organization (WTO).

Question 16

Shifting local jobs in foreign locations to take advantage of lower-wage labor in other countries is called _____________.

Accepted Answer

The answer of Shifting local jobs in foreign locations to...

Question 17

The main difference between domestic and international businesses is that the latter crosses national boundaries.

Accepted Answer

The statement is correct. Domestic businesses operate within a single country, while international businesses operate across multiple countries and cross national boundaries.

Question 18

If you purchase the latest CD from your favorite artist or the latest blockbuster DVD for a very low price while traveling internationally,you are likely facilitating the violation of intellectual property rights.

Accepted Answer

Many countries outside the US have lax intellectual property rights enforcement and therefore, purchasing pirated CDs or DVDs while traveling internationally is likely to be a violation of intellectual property rights. It is important to only purchase legitimately licensed products to support the artists, actors, and creators who deserve compensation for their work.

Question 19

Being a loner,acting uncooperative,and being irritable are considered universal inhibitors of leadership success.

Accepted Answer

These traits hinder effective communication, trust-building, and team collaboration, which are crucial for successful leadership.

Question 20

Most multinational corporations retain strong national identities even while operating around the world.

Accepted Answer

Multinational corporations often retain strong national identities through branding, cultural practices, and other forms of representation, even as they expand their operations globally.

Quiz 17: Globalization and International Business