Question 1

Hofstede's listed cultural variables include: power distance,uncertainty avoidance,individualism,collectivism,masculinity and femininity.

Accepted Answer

Hofstede's cultural variables include power distance, uncertainty avoidance, individualism, collectivism, masculinity, and femininity.

Question 2

Franchising is a form of direct investment.

Accepted Answer

Franchising is not considered a form of direct investment; rather, it is a business strategy for expanding a company where the franchisor licenses its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee. In contrast, direct investment refers to a domestic firm actually investing in and owning a foreign subsidiary or company.

Question 3

A wholly owned foreign affiliate is a foreign subsidiary over which an organisation has complete control.

Accepted Answer

A wholly owned foreign affiliate is a foreign subsidiary in which the parent company has total ownership and control. It is usually established to carry out the parent company's operations in the foreign market.

Question 4

International management refers to the situation whereby business recruits managers from more than one country to help run its business internationally.

Accepted Answer

International management involves managing business operations in more than one country, focusing on strategies, practices, and challenges of operating across national borders, rather than just recruiting managers from different countries.

Question 5

In addition to the dimensions identified by Hofstede,the GLOBE project identifies the following cultural characteristics: assertiveness,future orientation,gender differentiation,performance orientation and human orientation.

Accepted Answer

The answer of In addition to the dimensions identified by...

Question 6

In the __________ stage,an organisation has marketing and production facilities located in many countries,and more than one third of its sales emanates from outside the home country.

Accepted Answer

In the multinational stage, an organization has operations in multiple countries and generates a significant portion of its sales from international markets. This stage is characterized by the presence of marketing and production facilities in many countries, indicating a strong commitment to global operations. The other options - domestic, international, global, and stateless - do not accurately describe this stage of internationalization.

Question 7

The process of globalisation typically passes through all of the following stages except the:

Accepted Answer

The other four stages listed are commonly acknowledged stages of the globalization process, with the domestic stage referring to the initial phase of trade and communication within a country, followed by the international stage which involves cross-border transactions, the multinational stage which involves the establishment of foreign subsidiaries, and finally the global stage which signifies a fully integrated global system of trade and communication. The term "intradomestic" is not commonly used in discussions of globalization and does not represent a recognized stage in the process.

Question 8

When a company builds a new subsidiary in a foreign country it is often called a greenfield venture.

Accepted Answer

A greenfield venture refers to a company building a new subsidiary or facility from scratch in a foreign country.

Question 9

A high-context culture is one where people used communication primarily to exchange facts and information.

Accepted Answer

A high-context culture is actually one where people use communication to convey implicit meanings and rely heavily on nonverbal cues and context. Examples of high-context cultures include those found in many Asian, Middle Eastern, and Latin American countries.

Question 10

The management of business operations conducted in more than one country is called:

Accepted Answer

The term for managing business operations in more than one country is international management. Global management refers to managing a business on a worldwide scale, while outsourcing management focuses on managing the outsourcing of business functions to outside entities. Planning management is a general term for managing the planning process within a business, and domestic management refers to managing operations within a single country.

Question 11

The most risky direct investment,in which a company builds a subsidiary from scratch in a foreign company,is known as a:

Accepted Answer

The risky direct investment, in which a company builds a subsidiary from scratch in a foreign country, is known as a greenfield venture. This type of investment carries the highest risk as it involves building a new operation in an unfamiliar territory with little or no existing infrastructure or goodwill.

Question 12

Croc Sporting Supplies operates in a truly global fashion,making sales and acquiring resources in whatever country offers the best opportunities and lowest cost.What stage of international development is it in?

Accepted Answer

Croc Sporting Supplies is in the Stateless stage because it operates globally without a strong attachment to any one country, seeking the best opportunities and lowest costs worldwide.

Question 13

In the __________ stage,market potential is limited to home country,with all production and marketing facilities located at home.

Accepted Answer

The description given best fits the domestic stage of internationalization, where all production and marketing activities are concentrated in the home country and there is limited market potential beyond it.

Question 14

A company in the international stage often uses an international division to deal with the marketing of products in several countries individually.

Accepted Answer

This is true as an international division is a separate department within a company that focuses solely on managing and marketing products in different countries or regions around the world. It allows the company to have a centralized approach to international business while also adapting to local cultures and market conditions.

Question 15

The stateless stage is also referred to as the __________ stage.

Accepted Answer

The stateless stage is also known as the global stage. This is the stage where organizations operate globally without any specific ties to any particular country. They have a global presence and can operate in any country without any issues related to nationality or borders. This stage is characterized by a high level of integration and standardization.

Question 16

Licensing refers to an entry strategy whereby an organisation in a host country provides license to organisations in other countries to trade in the host country.

Accepted Answer

Licensing typically involves an organization (licensor) granting rights to another organization (licensee) to produce or sell its products, use its technology, or use its brand name, often in the licensee's country, rather than the licensor providing rights to foreign companies to trade in the licensor's own country.

Question 17

In which stage does the company usually adopt a multi-domestic approach?

Accepted Answer

The answer of In which stage does the company usually...

Question 18

The ability to appreciate and influence individuals,groups,organisations and systems that represent different social,cultural,political,institutional,intellectual and psychological characteristics is associated with a:

Accepted Answer

The ability to appreciate and influence diverse individuals, groups, and organizations is indicative of a global mindset, which involves a broad perspective and an understanding of global trends and issues. An international mindset may also focus on cross-cultural interactions, but it may be more limited in scope and may not necessarily encompass a global perspective. A planning mindset may involve setting and achieving goals, but it may not necessarily involve an appreciation for diversity. A domestic mindset would likely be more focused on local issues and may not involve interactions with diverse groups on a global level. An outsourcing mindset would be more specific to business practices and may not necessarily involve cultural or social interactions.

Question 19

A low-context culture emphasises the importance of communication as a way to build personal relationships.

Accepted Answer

A low-context culture emphasizes direct, explicit communication rather than relying on the context to communicate. Building personal relationships is more characteristic of high-context cultures, where understanding the context and non-verbal cues is crucial.

Question 20

An organisation that receives more than 25 per cent of its total sales revenues from operations outside the parent company's home country is called a transnational company.

Accepted Answer

This is the correct definition of a transnational company.

Quiz 4: Managing in a Global Environment