Exam 3: Business in a Global Environment

When communicating with other countries, you should regard cultural _____ as inappropriate and treat businesspeople as _____.

Both manufacturing and nonmanufacturing functions can be _____ to nations with lower _____.

Usually driven by the size and attractiveness of the foreign market, _____ is generally the most expensive commitment that a company can make in an overseas market.

By forming a foreign subsidiary, Cane Productions Ltd. hopes to realize such advantages as _____.

Chic Clothing Inc. has expanded to six locations in four different countries. Having seized the opportunity to make this move two years ago, top managers are now very glad they did (as are shareholders). Business is booming in both the U.S. and foreign markets. Current plans call for opening four new stores every year—two in the United States and two in Europe—for each of the next ten years. Chic’s managers are well aware that they’ll have to put a great deal of effort into learning new languages, traditions, customs, exchange rates, religions, and political practices. -Chic managers must appreciate the system of shared beliefs, values, customs, and behaviors-called "norms" or the "national normalcy scheme"-of each country in which they want to do business.

If the U.S. dollar goes down relative to a foreign currency, buyers using that currency pay ____ for American goods and services.

The West European buyers who purchase and resell Entrée Specialités' food products in their home countries are in the _____ business.

An absolute quota (as opposed to a quota) puts a(n) _____ on the quantity of a good that can be imported during a given period of time.

Among other things, many MNCs (multinational corporations) have increased their sensitivity to local market conditions by _____.

An absolute quota (as opposed to a quota) puts an upper limit on the quantity of a good that can be imported during a given period of time.

Ben Franklin's adage "Time is money" is now a universally accepted principle.

A common method of protecting domestic goods and trade is to boycott offending nations at home and abroad.

How does an international franchise work?

When nations continue to run large and ever-growing trade deficits over extended periods of time, creditor nations will eventually stop taking IOUs and trade will cease.

Cajun Chicken, a growing franchise chain based in Lafayette, Louisiana, has expanded to 185 locations in the United States. Because they realize that domestic growth is limited, the owners are contemplating expansion to selected foreign countries. Thus far, research has shown that the rights to use many of the firm’s recipes can be sold to other restaurants, cafeterias, and food stores. Cajun can also sell prepackaged food products, complete with spices, to other markets. At this point, whether to start by opening company-owned outlets or selling franchises is still a toss up. In any case, the long-term picture looks good. -In granting franchise rights, Cajun would be the _____ and the buyer would be the _____.

The World Bank annually loans approximately $70 billion to poor and developing nations, which can use the money for health, nutrition, and education.

Under a(n) _____, a foreign company pays a royalty fee to manufacture or sell your U.S. company's products, using your name and processes and perhaps your intellectual property.

With a troubled economy and the prospect of devastating economic times ahead, the Central European country of Westphalia should look to the World Bank for a major loan.

By the year 2010, international trade in merchandise and services had topped _____.

Although regional trade agreements exist around the world, we still don't have a solid answer to the question of whether they're moving the world closer to free trade on a global scale.