Question 1

An international strategy may not be viable in the long term, but companies that can pursue it need to shift toward a global standardization strategy to survive.

Accepted Answer

A) True 
 B)False

Question 2

Factor endowments, the cost and quality of factors of production, are a prime determinant of the competitive advantage that certain countries have in certain industries.

Accepted Answer

A) True 
 B)False

Question 3

Aries Travels is a company that offers holiday and travel packages. The company realizes that customer preferences vary and thus extensively customizes its packages. As there are not many competitors in the market in which Aries Travels operates, there are minimal pressures to reduce costs. Aries Travels is most likely to have adopted a _____ strategy.

Accepted Answer

A)   global standardization
B)   international
C)   localization
D)   transnational
E)   harvest

Question 4

Which entry mode gives a multinational the tightest control over foreign operations?

Accepted Answer

A)   Exporting from the home country and letting a foreign agent organize local marketing
B)   Licensing
C)   Franchising
D)   Entering into a joint venture with a foreign company to set up overseas operations
E)   Setting up a wholly owned subsidiary

Question 5

Cost reduction pressures can be particularly intense in industries producing:

Accepted Answer

A)   commodity-type products.
B)   highly differential products.
C)   highly customized services.
D)   goods that have no close substitutes.
E)   goods that need minimal advertising.

Question 6

Companies should form strategic alliances with firms that have a reputation for being opportunistic.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following statements is true about localization strategy?

Accepted Answer

A)   It focuses on marketing a standardized product worldwide to achieve cost reductions.
B)   It makes most sense when cost pressures are extremely intense.
C)   It is most appropriate when there are similarities across nations with regard to consumer tastes and preferences.
D)   It involves some duplication of functions and smaller production runs.
E)   It usually relieves companies of the task of closely monitoring their costs.

Question 8

The Achilles heel of international strategy is that:

Accepted Answer

A)   economies of scale cannot be achieved.
B)   customization of products makes the company lose its credibility.
C)   competitors inevitably emerge.
D)   non-price differences among products hold little importance.
E)   customer preferences eventually become identical.

Question 9

Which of the following factors increases pressures for cost reductions?

Accepted Answer

A)   Meaningful differentiation between products
B)   Reduced international competition
C)   Competitors that are based in high-cost locations
D)   High switching costs
E)   Persistent excess capacity

Question 10

Starbucks, Sony, and Coca-Cola conduct business in two or more countries. These companies can be referred to as multinational companies.

Accepted Answer

A) True 
 B)False

Question 11

Strategic alliances can be designed to make it difficult (if not impossible) to transfer technology that is not meant to be transferred.

Accepted Answer

A) True 
 B)False

Question 12

Despite the globalization of production and markets, many of the most successful companies in certain industries are still clustered in a small number of countries.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is not a risk of exporting?

Accepted Answer

A)   Tariff barriers
B)   Transportation costs
C)   Location diseconomies
D)   High manufacturing costs
E)   Delegation of marketing activities to a local agent

Question 14

A company, Pluto Inc., employs the franchising strategy to enter a new national market. Which of the following statements is more likely to be true of Pluto?

Accepted Answer

A)   It is more likely to be a service company.
B)   It is more likely to have a greater control over the quality the products manufactured in the foreign country.
C)   It is less likely to impose strict rules regarding how a franchisee does business.
D)   It is less likely to receive royalty payment from the franchisee.
E)   It is more likely to bear the development costs associated with opening a foreign market on its own.

Question 15

List and briefly describe each of the four basic global strategies.

Accepted Answer

Companies that pursue a global standardi...

Question 16

What are the potential benefits and risks of global strategic alliances? What actions can a firm take to minimize the risks and maximize the benefits?

Accepted Answer

Global strategic alliances share the ris...

Question 17

Which of the following is not an attribute of a national or country-specific environment that has an impact on global competitiveness of companies located in that nation?

Accepted Answer

A)   Factor endowments
B)   Local demand conditions
C)   Related and supporting industries
D)   Strategy, structure, and rivalry of firms within the nation
E)   Advertising expenses

Question 18

Most manufacturing companies begin their global expansion by exporting.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is an advantage of franchising?

Accepted Answer

A)   It ensures tight control over quality.
B)   It enables companies to engage in global strategic coordination.
C)   It involves low development costs and risks.
D)   It enables the company to collect all the profits made by the franchisees.
E)   It frees companies from the task of monitoring and assisting operations at franchisees.

Question 20

The globalization of production has caused firms to:

Accepted Answer

A)   lower their market share.
B)   lower their cost structure.
C)   centralize their production process.
D)   curb international competition.
E)   limit the number of market segments.

Exam 8: Strategy in the Global Environment

List and briefly describe each of the four basic global strategies.

Correct Answer
verified
Companies that pursue a global standardi...
View Answer

The globalization of production has caused firms to:

Correct Answer
verified

Cost reduction pressures can be particularly intense in industries producing:

Correct Answer
verified

Which of the following is not a risk of exporting?

Correct Answer
verified

What are the potential benefits and risks of global strategic alliances? What actions can a firm take to minimize the risks and maximize the benefits?

Correct Answer
verified
Global strategic alliances share the ris...
View Answer

An international strategy may not be viable in the long term, but companies that can pursue it need to shift toward a global standardization strategy to survive.

Correct Answer
verified

Which entry mode gives a multinational the tightest control over foreign operations?

Correct Answer
verified

Which of the following statements is true about localization strategy?

Correct Answer
verified

Factor endowments, the cost and quality of factors of production, are a prime determinant of the competitive advantage that certain countries have in certain industries.

Correct Answer
verified

Which of the following is an advantage of franchising?

Correct Answer
verified

Companies should form strategic alliances with firms that have a reputation for being opportunistic.

Correct Answer
verified

Strategic alliances can be designed to make it difficult (if not impossible) to transfer technology that is not meant to be transferred.

Correct Answer
verified

The Achilles heel of international strategy is that:

Correct Answer
verified

Starbucks, Sony, and Coca-Cola conduct business in two or more countries. These companies can be referred to as multinational companies.

Correct Answer
verified

Despite the globalization of production and markets, many of the most successful companies in certain industries are still clustered in a small number of countries.

Correct Answer
verified

Correct Answer
verified

Which of the following is not an attribute of a national or country-specific environment that has an impact on global competitiveness of companies located in that nation?

Correct Answer
verified

Most manufacturing companies begin their global expansion by exporting.

Correct Answer
verified

Which of the following factors increases pressures for cost reductions?

Correct Answer
verified

A company, Pluto Inc., employs the franchising strategy to enter a new national market. Which of the following statements is more likely to be true of Pluto?

Correct Answer
verified

Exam 8: Strategy in the Global Environment

List and briefly describe each of the four basic global strategies.

Correct AnswerverifiedCompanies that pursue a global standardi...View AnswerShow Answer

The globalization of production has caused firms to:

Correct AnswerverifiedShow Answer

Cost reduction pressures can be particularly intense in industries producing:

Correct AnswerverifiedShow Answer

Which of the following is not a risk of exporting?

Correct AnswerverifiedShow Answer

What are the potential benefits and risks of global strategic alliances? What actions can a firm take to minimize the risks and maximize the benefits?

Correct AnswerverifiedGlobal strategic alliances share the ris...View AnswerShow Answer

An international strategy may not be viable in the long term, but companies that can pursue it need to shift toward a global standardization strategy to survive.

Correct AnswerverifiedShow Answer

Which entry mode gives a multinational the tightest control over foreign operations?

Correct AnswerverifiedShow Answer

Which of the following statements is true about localization strategy?

Correct AnswerverifiedShow Answer

Factor endowments, the cost and quality of factors of production, are a prime determinant of the competitive advantage that certain countries have in certain industries.

Correct AnswerverifiedShow Answer

Which of the following is an advantage of franchising?

Correct AnswerverifiedShow Answer

Companies should form strategic alliances with firms that have a reputation for being opportunistic.

Correct AnswerverifiedShow Answer

Strategic alliances can be designed to make it difficult (if not impossible) to transfer technology that is not meant to be transferred.

Correct AnswerverifiedShow Answer

The Achilles heel of international strategy is that:

Correct AnswerverifiedShow Answer

Starbucks, Sony, and Coca-Cola conduct business in two or more countries. These companies can be referred to as multinational companies.

Correct AnswerverifiedShow Answer

Despite the globalization of production and markets, many of the most successful companies in certain industries are still clustered in a small number of countries.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is not an attribute of a national or country-specific environment that has an impact on global competitiveness of companies located in that nation?

Correct AnswerverifiedShow Answer

Most manufacturing companies begin their global expansion by exporting.

Correct AnswerverifiedShow Answer

Which of the following factors increases pressures for cost reductions?

Correct AnswerverifiedShow Answer

A company, Pluto Inc., employs the franchising strategy to enter a new national market. Which of the following statements is more likely to be true of Pluto?

Correct AnswerverifiedShow Answer

Correct Answer
verified
Companies that pursue a global standardi...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Global strategic alliances share the ris...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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