Question 1

Write a note on cultural distance.

Accepted Answer

Cultural distance refers to differences

Question 2

Which of the following statements is true about multidomestic strategy?

Accepted Answer

A)  It tailors products and operations to individual markets. 
B)  It prefers to standardize products to achieve economies of scale. 
C)  It does not allow regional managers to make decisions on their own. 
D)  It enables firms to easily develop a worldwide competitive advantage. 
A)  It tailors products and operations to individual markets. 
B)  It prefers to standardize products to achieve economies of scale. 
C)  It does not allow regional managers to make decisions on their own. 
D)  It enables firms to easily develop a worldwide competitive advantage.

Question 3

Although there are a number of alternative treatments available across the globe, herbal products produced in Brazil are sold at a premium.The ancient Brazilian recipes for wellness are considered the main reason for the premium price.This is an example of a(n) _____ arbitrage.

Accepted Answer

A)  economic 
B)  cultural 
C)  administrative 
D)  capital 
A)  economic 
B)  cultural 
C)  administrative 
D)  capital

Question 4

Which of the following is a disadvantage of exporting as a mode for entering a foreign market?

Accepted Answer

A)  It increases the cost of selling in the foreign market. 
B)  It does not work when the product adaptation required is minimal. 
C)  It cannot work with distribution networks in the foreign market. 
D)  It involves heavy investment in the foreign country. 
A)  It increases the cost of selling in the foreign market. 
B)  It does not work when the product adaptation required is minimal. 
C)  It cannot work with distribution networks in the foreign market. 
D)  It involves heavy investment in the foreign country.

Question 5

Which of the following statements is true of alliances as a means of entering international markets?

Accepted Answer

A)  It is a favored way to enter markets that are close to the home market. 
B)  It allows the alliance to be perceived by both government and consumers as local. 
C)  It avoids sharing resources, risks, and rewards. 
D)  It offers the least amount of control of all the various modes of entry. 
A)  It is a favored way to enter markets that are close to the home market. 
B)  It allows the alliance to be perceived by both government and consumers as local. 
C)  It avoids sharing resources, risks, and rewards. 
D)  It offers the least amount of control of all the various modes of entry.

Question 6

Neferent Inc., a finance company, incorporates itself in the Notre Islands because of low corporate tax rates there.In this case, the strategy adopted by Neferent is to gain a(n) _____.

Accepted Answer

A)  economic arbitrage 
B)  cultural arbitrage 
C)  administrative arbitrage 
D)  capital arbitrage 
A)  economic arbitrage 
B)  cultural arbitrage 
C)  administrative arbitrage 
D)  capital arbitrage

Question 7

In the context of modes of international market entry, which of the following statements is true of licensing and franchising?

Accepted Answer

A)  It offers the highest amount of control of all the various modes of entry. 
B)  It is easy to extract knowledge for use in other locations through this mode. 
C)  It can increase the cost of selling in a foreign market. 
D)  It involves the risk of a local firm in alliance to become a competitor. 
A)  It offers the highest amount of control of all the various modes of entry. 
B)  It is easy to extract knowledge for use in other locations through this mode. 
C)  It can increase the cost of selling in a foreign market. 
D)  It involves the risk of a local firm in alliance to become a competitor.

Question 8

Trosome Petroleum Corp.opens new plants in Sopintry.In order to gain economies of scale, it centralizes its products and operations.Decisions regarding operations in Sopintry are made at the central headquarters.Which of the following primary strategies is used by the company to do business internationally?

Accepted Answer

A)  A multidomestic strategy 
B)  A global strategy 
C)  An arbitrage strategy 
D)  A local responsiveness strategy 
A)  A multidomestic strategy 
B)  A global strategy 
C)  An arbitrage strategy 
D)  A local responsiveness strategy

Question 9

Tokef Inc., a U.S.-based firm, adopts a multidomestic strategy to enter the Japanese market.Which of the following is likely to be true in this case?

Accepted Answer

A)  It is likely to focus on local responsiveness over standardization. 
B)  It is likely to focus on economies of scale over local responsiveness. 
C)  It is likely to focus on global standardization over local responsiveness. 
D)  It is likely to focus on standardization over mass customization. 
A)  It is likely to focus on local responsiveness over standardization. 
B)  It is likely to focus on economies of scale over local responsiveness. 
C)  It is likely to focus on global standardization over local responsiveness. 
D)  It is likely to focus on standardization over mass customization.

Question 10

Score Ink Corp., a publishing firm, decides to enter a new market.It changes its strategy from standardization to local responsiveness in order to meet the needs of the new market.However, in order to execute this strategy, it had to increase production and distribution expenses.Which of the following is adopted by Score Ink?

Accepted Answer

A)  A multidomestic strategy 
B)  A global strategy 
C)  An arbitrage strategy 
D)  A standardization strategy 
A)  A multidomestic strategy 
B)  A global strategy 
C)  An arbitrage strategy 
D)  A standardization strategy

Question 11

Which of the following is true of costs in terms of how firms compete internationally?

Accepted Answer

A)  Adapting operations to fit local circumstances is cheap. 
B)  The more tailored a product is, the higher the cost. 
C)  Higher costs ensure risks are lowered or negated. 
D)  Firms achieve economies of scale by avoiding standardization. 
A)  Adapting operations to fit local circumstances is cheap. 
B)  The more tailored a product is, the higher the cost. 
C)  Higher costs ensure risks are lowered or negated. 
D)  Firms achieve economies of scale by avoiding standardization.

Question 12

A healthcare company deals with significant management challenges.The production units are based in various geographic locations, which results in cultural and linguistic barriers.Operations require relying on a local firm to adapt the products to meet the needs of the local market.In this case, the company is likely to be engaging in _____.

Accepted Answer

A)  Exporting 
B)  Importing 
C)  Offshoring 
D)  Alliances 
A)  Exporting 
B)  Importing 
C)  Offshoring 
D)  Alliances

Question 13

Hats Corp., a firm headquartered in Boston, enters India through a wholly owned subsidiary.It has already franchised a few units to Nepal and China.Which of the following is likely to be true in this case?

Accepted Answer

A)  Hats faces lesser risk through the wholly owned subsidiary than the franchises it holds in Nepal. 
B)  Hats invests lesser in the wholly owned subsidiary in India than the franchise it holds in China. 
C)  Hats appears more local through a wholly owned subsidiary than a franchise. 
D)  Hats overcomes trade and transportation barriers better through a franchise than a wholly owned subsidiary. 
A)  Hats faces lesser risk through the wholly owned subsidiary than the franchises it holds in Nepal. 
B)  Hats invests lesser in the wholly owned subsidiary in India than the franchise it holds in China. 
C)  Hats appears more local through a wholly owned subsidiary than a franchise. 
D)  Hats overcomes trade and transportation barriers better through a franchise than a wholly owned subsidiary.

Question 14

Two marketing students, Fiona and Sayid, discuss the strategies of Star Seven Inc., a leading firm in the United States.Fiona believes that Star Seven entered a foreign market for the sake of efficiency, while Sayid argues that it entered for the purpose of expanding knowledge.Which of the following weakens Fiona's argument?

Accepted Answer

A)  Star Seven aims to spread the costs of investments in plant and equipment across more sales in the new market. 
B)  Star Seven aims to serve multiple types of customers in the new market to gain new insights about its products. 
C)  Star Seven aims to sell products produced in excess at lower prices in the new market. 
D)  Star Seven aims to outsource some of its functions to reduce the labor and production costs. 
A)  Star Seven aims to spread the costs of investments in plant and equipment across more sales in the new market. 
B)  Star Seven aims to serve multiple types of customers in the new market to gain new insights about its products. 
C)  Star Seven aims to sell products produced in excess at lower prices in the new market. 
D)  Star Seven aims to outsource some of its functions to reduce the labor and production costs.

Question 15

Slate-E Corp., an industrial equipment manufacturer, engages in design adaptability in order to manage the costs of variations.Which of the following is likely to be true in this case?

Accepted Answer

A)  Slate-E's is likely to mass produce machinery that are standard across the globe. 
B)  Slate-E's cranes are likely to have the exact same external features in every market. 
C)  Slate-E's factory machines are likely to have standard core components across the globe. 
D)  Slate-E's is likely to create highly customized equipment from scratch for every individual customer. 
A)  Slate-E's is likely to mass produce machinery that are standard across the globe. 
B)  Slate-E's cranes are likely to have the exact same external features in every market. 
C)  Slate-E's factory machines are likely to have standard core components across the globe. 
D)  Slate-E's is likely to create highly customized equipment from scratch for every individual customer.

Question 16

Maria and Sasha, researchers at Gem Corp., discuss the best method for their firm to enter a foreign market with wholly owned subsidiaries.Maria believes that greenfield investments would be more suitable, while Sasha believes that acquiring a local firm is a better option.Which of the following weakens Maria's argument?

Accepted Answer

A)  Gem requires high level of control right from production to marketing in the new market. 
B)  Gem has the capabilities and resources required to set up a unit from scratch. 
C)  Gem finds integration to be very difficult because of the cultural differences with the host country. 
D)  Gem needs to enter the new market at the earliest to gain advantage of the product cycle. 
A)  Gem requires high level of control right from production to marketing in the new market. 
B)  Gem has the capabilities and resources required to set up a unit from scratch. 
C)  Gem finds integration to be very difficult because of the cultural differences with the host country. 
D)  Gem needs to enter the new market at the earliest to gain advantage of the product cycle.

Question 17

In which of the following circumstances can a firm best achieve economies of scale?

Accepted Answer

A)  When the firm is able to spread the costs of investments in plant across many sales 
B)  When the firm creates better quality products due to higher quality equipment 
C)  When the firm is able to reap the benefit of investing in research through higher customer satisfaction 
D)  When the firm creates highly customized products for a niche audience in the market 
A)  When the firm is able to spread the costs of investments in plant across many sales 
B)  When the firm creates better quality products due to higher quality equipment 
C)  When the firm is able to reap the benefit of investing in research through higher customer satisfaction 
D)  When the firm creates highly customized products for a niche audience in the market

Question 18

Jade Inc., an automobile company, manages the costs of localization by mass producing standard core components such as the engine.However, it makes these components in such a way that they can be adapted to modified external components that are customized to specific local markets.This ensures a certain extent of economies of scale.Which of the following is exemplified in this case?

Accepted Answer

A)  Focus adaptations 
B)  Externalize adaptations 
C)  Design adaptability 
D)  Market adaptability 
A)  Focus adaptations 
B)  Externalize adaptations 
C)  Design adaptability 
D)  Market adaptability

Question 19

_____ is the need to tailor an organization's products, marketing, and distribution strategies to the local customers in a foreign country.

Accepted Answer

Local resp

Question 20

Dave is a research analyst at Geo Corp., a U.S.-based firm, specializing in organic farm produce.Since the management is considering entering a foreign market, Dave begins to study the risks associated with this move.After gathering sufficient data regarding the internal factors of the new market, he categorizes the risks based on the type.Which of the following is most likely to be considered a political risk?

Accepted Answer

A)  Marketers of Geo standardizing products based on local market needs 
B)  Distribution costs being higher in the market than that in the United States 
C)  Laws prohibiting foreign ownership of local firms in the new market 
D)  Consumers preferring local goods to foreign products in the new market 
A)  Marketers of Geo standardizing products based on local market needs 
B)  Distribution costs being higher in the market than that in the United States 
C)  Laws prohibiting foreign ownership of local firms in the new market 
D)  Consumers preferring local goods to foreign products in the new market

Write a note on cultural distance.

Which of the following statements is true about multidomestic strategy?

Although there are a number of alternative treatments available across the globe, herbal products produced in Brazil are sold at a premium.The ancient Brazilian recipes for wellness are considered the main reason for the premium price.This is an example of a(n) _____ arbitrage.

Which of the following is a disadvantage of exporting as a mode for entering a foreign market?

Which of the following statements is true of alliances as a means of entering international markets?

Neferent Inc., a finance company, incorporates itself in the Notre Islands because of low corporate tax rates there.In this case, the strategy adopted by Neferent is to gain a(n) _____.

In the context of modes of international market entry, which of the following statements is true of licensing and franchising?

Tokef Inc., a U.S.-based firm, adopts a multidomestic strategy to enter the Japanese market.Which of the following is likely to be true in this case?

Which of the following is true of costs in terms of how firms compete internationally?

Hats Corp., a firm headquartered in Boston, enters India through a wholly owned subsidiary.It has already franchised a few units to Nepal and China.Which of the following is likely to be true in this case?

Slate-E Corp., an industrial equipment manufacturer, engages in design adaptability in order to manage the costs of variations.Which of the following is likely to be true in this case?

In which of the following circumstances can a firm best achieve economies of scale?

_____ is the need to tailor an organization's products, marketing, and distribution strategies to the local customers in a foreign country.

What Is Business Strategy?

Analysis of the External Environment: Opportunities and Threats

Internal Analysis: Strengths, Weaknesses, and Competitive Advantage

Cost Advantage

Differentiation Advantage

Corporate Strategy

Vertical Integration and Outsourcing

Strategic Alliances

Innovative Strategies That Change the Nature of Competition

Competitive Strategy

Implementing Strategy

Corporate Governance and Ethics

Strategy and Society

Filters

Exam 9: International Strategy

Write a note on cultural distance.

Which of the following statements is true about multidomestic strategy?

Although there are a number of alternative treatments available across the globe, herbal products produced in Brazil are sold at a premium.The ancient Brazilian recipes for wellness are considered the main reason for the premium price.This is an example of a(n) _____ arbitrage.

Which of the following is a disadvantage of exporting as a mode for entering a foreign market?

Which of the following statements is true of alliances as a means of entering international markets?

Neferent Inc., a finance company, incorporates itself in the Notre Islands because of low corporate tax rates there.In this case, the strategy adopted by Neferent is to gain a(n) _____.

In the context of modes of international market entry, which of the following statements is true of licensing and franchising?

Tokef Inc., a U.S.-based firm, adopts a multidomestic strategy to enter the Japanese market.Which of the following is likely to be true in this case?

Which of the following is true of costs in terms of how firms compete internationally?

Hats Corp., a firm headquartered in Boston, enters India through a wholly owned subsidiary.It has already franchised a few units to Nepal and China.Which of the following is likely to be true in this case?

Slate-E Corp., an industrial equipment manufacturer, engages in design adaptability in order to manage the costs of variations.Which of the following is likely to be true in this case?

In which of the following circumstances can a firm best achieve economies of scale?

_____ is the need to tailor an organization's products, marketing, and distribution strategies to the local customers in a foreign country.

What Is Business Strategy?

Analysis of the External Environment: Opportunities and Threats

Internal Analysis: Strengths, Weaknesses, and Competitive Advantage

Cost Advantage

Differentiation Advantage

Corporate Strategy

Vertical Integration and Outsourcing

Strategic Alliances

Innovative Strategies That Change the Nature of Competition

Competitive Strategy

Implementing Strategy

Corporate Governance and Ethics

Strategy and Society

Filters