Deck 7: Reaching Global Markets

Question 1

All of the following are reasons Dell changed its telephone and online ordering process in India except that:

A)customers in India prefer to see and touch products.
B)customers in India don't know the Dell brand.
C)customers in India prefer to try a computer before purchasing.
D)customers in India are responsive to door-to-door sales.

Answer 1

B

Question 2

World trade flows to and from Canada for goods and services among nations and industries reflect _ .

A)demand and supply interdependencies
B)positive and negative synergistic trade
C)holistic trade
D)a negative currency exchange

Answer 2

A

Question 3

The phenomenon in which a country's imports affect its exports and its exports affect its imports is referred to as

A)Product exchange loop
B)Trade feedback effect
C)Balance of trade
D)Trade equity

Answer 3

B

Question 4

By 2040, it is estimated that all of the following will be part of Canada's top 10 export markets except:

A)Mexico.
B)South Korea.
C)Nigeria.
D)Brazil.

Question 5

Which of the factors below has played a key role in Dell's advertising campaign, "Take Your Own Path," in India?

A)featuring local, real-life entrepreneurs.
B)using a consistent global communication message.
C)running the campaign on social media.
D)translating the message to local languages.

Question 6

The importance of e-commerce in global markets is increasing significantly. One of the major reasons is because, online e-commerce offers:

A)the access to significant numbers of buyers
B)the inability to offer warranties
C)the inability to sue companies in foreign countries
D)the ability to hedge currency exchange rates

Question 7

The Malaysian government exchanged 20,000 tonnes of rice for an equivalent amount of Philippine corn. This international exchange is an example of:

A)cross-cultural exchange.
B)economic adaptation.
C)predatory pricing.
D)countertrade.

Question 8

Not only are global markets substantial in size, but many global markets are:

A)experiencing stagnant growth.
B)growing faster than the Canadian market.
C)willing to buy more foreign goods.
D)facing political turmoil.

Question 9

By providing start-up microfinancing loans to individuals in India, Lever addressed which problem in their 4Ps strategy for the Indian market?

A)product
B)pricing
C)place
D)promotion

Question 10

For Canada, the monetary value of all goods and services produced during one year was recently valued at $1.75 trillion. This is referred to as Canada's

A)balance of payments (BOP)
B)transfer payment options (TPO)
C)gross domestic product (GDP)
D)international indebtedness (IID)

Question 11

Volvo of North America delivered automobiles to the Siberian police force when Siberia had no cash to pay for them. It accepted payment in oil, which it then sold for cash to pay for media advertising. This international exchange is an example of:

A)economic adaptation.
B)a countertrade.
C)predatory pricing.
D)cross-cultural exchange.

Question 12

Global businesses, such as Motorola have recognized the importance of offering products to the 'bottom of the pyramid' socio-economic group. All of the following are features of a cell phone that Motorola offers to this group except:

A)standby time of a couple of weeks
B)extra-long battery life
C)controls in English to encourage learning the language
D)extra-loud volume

Question 13

The trade feedback effect is one argument for:

A)increased tariffs and quotas.
B)decreasing a nation's imports.
C)international trade associations.
D)free trade agreements.

Question 14

Dell's 2007 global growth initiative has paid off. Today the company is successful in countries like China and India. In fact, they now post annual sales of in India.

A)$2.8 billion
B)$2.5 billion
C)$9.25 million
D)$1.5 billion

Question 15

Which of the following statements about Canadian gross domestic product (GDP)is NOT true?

A)Canada exports over 35% of GDP, making it an important trading nation.
B)The three largest importers of Canadian goods and services are the United States, Japan and the European Union (EU).
C)Canada's gross domestic product is valued at over $1.75 trillion.
D)Canada exports over 50% of GDP, making it an important trading nation.

Question 16

Dell's retail strategy in India includes developing a such as Croma and eZone. in Indian chain retailers

A)shop-in-a-shop
B)pop-up store
C)point of purchase display
D)dedicated Dell ordering terminal

Question 17

All of the following are true aspects about the 'bottom of the pyramid' except

A)this socio-economic group is a focus for global businesses
B)individuals live on less than $2 a day
C)this socio-economic group is not a concern to global businesses
D)the population of this socio-economic group is approximately 4 billion

Question 18

Some global firms have recognized that if individuals in developing countries are provided small amounts of collateral-free capital, they can, in turn, grow successful local businesses, which may include selling products of the donating firm. These
Global firms have recognized which important concept?

A)micro-loan
B)women-driven entrepreneurship
C)micro-entrepreneurship
D)microfinancing

Question 19

In a world where 70 percent of all countries do not have convertible currencies or where government-owned enterprises lack sufficient cash or credit for imports, other means of payment are used. An estimated 15 to 20 percent of world trade involves , the practice of using barter rather than money for making global sales.

A)cross-cultural exchange
B)predatory pricing
C)economic adaptation
D)a countertrade

Question 20

One of the primary reasons that Canada will experience a shift in global trading partners and the type of Canadian exports by 2040 will be:

A)growing role of emerging markets in the global economy
B)decreased political instability
C)decreasing reliance on natural resources
D)currency stabilization

Question 21

Coca-Cola has adopted a short-message communication tool, similar to Twitter that is more prominent in South East Asia, to disseminate and market their soft-drink products. All of the following are likely reasons that Coca-Cola is using this local communication tool, except

A)Twitter is not well adopted in South East Asia
B)the local communication tool has more followers
C)more local soft drink brands use this communication tool
D)the local communication tool has a small, but loyal following

Question 22

The Dutch lead the world in the cut-flower industry because of their research in flower cultivation, packaging, and shipping-not because of their weather. This is an example of in their competitive advantage as a nation.

A)demand conditions
B)factor conditions
C)socio-cultural conditions
D)structural conditions

Question 23

Why might an upstart firm developing a new type of landing gear want to locate in Quebec's advanced aerospace cluster, home to firms such as Boeing, Bombardier, Pratt & Whitney, and Rolls Royce?

A)demand conditions
B)company structure, strategy, and rivalry
C)factor conditions
D)related and supporting industries

Question 24

Austria has been described as "the very heartland of European coffee culture." Austrians drink 21.5 litres of coffee per person annually. Starbucks wanted to open coffeehouses in Austria and sell Starbucks coffee there. For Starbucks, the Austrian level of coffee sophistication would be an example of:

A)demand conditions.
B)structural conditions.
C)competitive conditions.
D)socio-cultural conditions.

Question 25

The German leadership in scientific and industrial instrumentation relates directly to the cluster of supporting German precision engineering suppliers. This is an example of in their competitive advantage as a nation.

A)competitive conditions
B)structural conditions
C)related and supporting industries
D)demand conditions

Question 26

Which of the following is an example of related and supporting industries?

A)existence of supplier clusters
B)media exposure of products
C)intensity of competition
D)sophistication of consumers

Question 27

Which of the following statements best describes the recent relationship between the imports into Canada and the exports from Canada?

A)Exports have exceeded imports, indicating a continuing trade surplus.
B)Imports into Canada and exports have been about equal, indicating balanced trade.
C)The volume of imports and exports has consistently decreased.
D)No accurate data has been available on trade imports and exports.

Question 28

Michael Porter has identified four key elements to explain why some companies and industries succeed globally while others fail. These four elements collectively are called:

A)industrial diversity.
B)trade feedback effect.
C)the "diamond" of national competitive advantage.
D)balance of trade.

Question 29

A graphical representation of Michael Porter's elements which create a nation's competitive advantage looks like a:

A)diamond.
B)circle or loop.
C)continuum.
D)pyramid.

Question 30

To become leaders in the world market, countries need related and supporting industries because:

A)clusters of strong suppliers can accelerate innovation.
B)they want to eliminate the need to import materials from other countries.
C)suppliers can generate revenue for further investment.
D)most countries still believe strongly in protectionism.

Question 31

The Italian shoe industry has become a world leader because of intense domestic competition among such firms as MAB, Bruno Magli, and Rossimoda, which has made shoes for Christian Dior and Anne Klein Couture. This is an example of ________ in their competitive advantage as a nation.

A)company strategy, structure, and rivalry
B)competitive conditions
C)demand conditions
D)related and supporting industries

Question 32

Which of the following is an example of a demand condition?

A)sophistication of consumers
B)intensity of competition
C)existence of supplier clusters
D)natural resources

Question 33

Every day, in a third-class carriage of the express train that rolls between Bombay and Ahmedabad, plainly dressed couriers carry precious cargo: diamonds. Rough gems are imported to Bombay from dealers in London, Antwerp, Tel Aviv, and New York, taken by these couriers to cutting and polishing centers in Gujarat state, and then
Carried back to Bombay to be reexported to the world. This system, based on trust,
Secrecy, and skilled low-cost labour, has been working for half a century. It has helped make India the world's premier center for diamond cutting and polishing. Nine out of every 10 stones sold in the world pass through India, making diamonds that country's
Largest export at $6.6 billion a year. This ability to use its skilled labour as a resource is an example of what Michael Porter would term:

A)demand conditions.
B)structural conditions.
C)factor conditions.
D)socio-cultural conditions.

Question 34

Michael Porter has identified four key elements in a nation's competitive advantage. They are factor conditions, related and supporting industries; and company strategy, structure, and rivalry; and:

A)industrial diversity.
B)governmental regulation.
C)consumer behaviour.
D)demand conditions.

Question 35

Researchers concluded that all of the below are effective axioms to include social media in a global marketing strategy except

A)In the age of social media, general issues seldom remain general; that is, macro issues tend to be re-interpreted locally.
B)Social media is most useful as a "one-size-fits-all" approach, as it is too difficult to target each culture and their norms and perceptions effectively.
C)In the age of social media, local events seldom remain local.
D)Social media is a function of the technology, culture, and government of a particular country.

Question 36

According to Michael Porter's diamond of national competitive advantage, both the number and sophistication of domestic customers for an industry's product are examples of:

A)structural conditions.
B)socio-cultural conditions.
C)demand conditions.
D)competitive conditions.

Question 37

A nation's ability to turn its natural resources, education, and infrastructure into a competitive advantage is reflected in:

A)structural conditions.
B)socio-cultural conditions.
C)competitive conditions.
D)factor conditions.

Question 38

Japan's sophisticated consumers expect quality in their TVs and radios, thereby making Japan's producers, such as Sony, Sanyo, Matsushita, and Hitachi, some of the world leaders in the electronics industry. This is an example of in their competitive advantage as a nation.

A)socio-cultural conditions
B)competitive conditions
C)structural conditions
D)demand conditions

Question 39

World trade is so important to the global economy because more than total world merchandise is traded among the top 10 exporters and importers.

A)40%
B)90%
C)50%
D)60%

Question 40

Michael Porter has identified four key elements in a nation's competitive advantage. They are demand conditions; related and supporting industries; and company strategy, structure, and rivalry; and:

A)industrial diversity.
B)consumer behaviour.
C)governmental regulation.
D)factor conditions.

Question 41

The European Union (EU)bans the importation of hormone-fed U.S. beef and bioengineered corn and soybeans on safety grounds although Americans eat this food every day. This ban encourages consumers in the EU to buy domestic beef and products made from domestically produced corn and soybeans. This ban is an example of:

A)the rule of protective domain.
B)ethnocentrism.
C)protectionism.
D)domestic imperialism.

Question 42

Those in favour of protectionism would never say that protectionism:

A)discourages economic dependency on foreign countries.
B)helps reduce tariffs and quotas.
C)encourages the development of domestic industries.
D)protects a nation's political security.

Question 43

Nine out of every 10 diamonds sold in the world pass through India, making diamonds that country's largest export at $6.6 billion a year. One of the reasons for its success is the nation's 2,500 trading firms, its banks, airlines, customers' offices, and courier services that make sure the diamonds are safely delivered. Most of these are members of the diamond trading bourse in Bombay. According to Michael Porter's theory about national competitive advantage, India's success in the diamond industry is due in part to its:

A)factor conditions.
B)absence of competition.
C)related and supporting industries.
D)company strategy, structure, and rivalry.

Question 44

Huge international opportunities await Canadian businesses in emerging markets. The reason for this is that emerging markets are facing

A)population, transportation, and energy
B)energy, water, and food
C)population, water, and food
D)population, education, and transportation

Question 45

In April 2001, the Japanese government, under pressure from its farm lobby, slapped government taxes on mushrooms, leeks, and the reeds used in tatami mats that were being imported from China. Japan levied:

A)tariffs.
B)quotas.
C)GATT taxes.
D)foreign excise taxes.

Question 46

Which of the following statements reflects Michael Porter's theory regarding national competitive advantage?

A)The first goal of a global marketer is to actively educate a nation's domestic customers.
B)A country's natural resources, education, and infrastructure often pose obstacles that cannot be overcome.
C)Clusters of strong suppliers can interfere with entry into a global market.
D)A firm that succeeds in global markets often has first succeeded in intense domestic competition.

Question 47

Although there are many factors contributing to the success of major global marketers, a common theme seems to be that they:

A)first succeeded in intense domestic competition.
B)employed a multi-cultural or multi-national staff.
C)specialized in services rather than consumer goods.
D)first became involved with a formalized trade organization (such as the EU, NAFTA, etc.).

Question 48

Which industry in India represents an excellent opportunity for Canadian companies seeking to export their product?

A)Entertainment
B)Natural Gas
C)Food
D)Telecommunications

Question 49

Reference: 07-01
Figure 7-2

According to Michael Porter's diamond in Figure 7-2, quadrant "B" represents

A)demand conditions.
B)factor conditions.
C)company strategy, structure, and rivalry.
D)related and supporting industries.

Question 50

Which of the following is NOT an element of company strategy, structure, and rivalry?

A)existence of supplier clusters
B)public ownership
C)private ownership
D)number of companies in an industry

Question 51

Reference: 07-01
Figure 7-2

According to Michael Porter's diamond in Figure 7-2, quadrant "A" represents

A)managerial conditions.
B)factor conditions.
C)related and supporting industries.
D)demand conditions.

Question 52

Reference: 07-01
Figure 7-2

According to Michael Porter's diamond in Figure 7-2, quadrant "D" represents

A)related and supporting industries.
B)managerial conditions.
C)demand conditions.
D)factor conditions.

Question 53

Canada's fastest growing exports are services and expertise. This is creating an opportunity for Canada to export services from a variety of resource and
Manufacturing sectors.

A)political
B)academic
C)trade
D)consulting

Question 54

Reference: 07-01
Figure 7-2

According to Michael Porter's diamond in Figure 7-2, quadrant "C" represents

A)factor conditions.
B)managerial conditions.
C)demand conditions.
D)related and supporting industries.

Question 55

When Bell, Telus, and Rogers, lobby and petition the Canada government to change the regulation rules with regards to foreign ownership of telecom companies. Bell, Telus, and Rogers are trying to create a veil of _.

A)ethnocentrism
B)the rule of protective domain
C)protectionism
D)domestic imperialism

Question 56

Canada's trade agreements create business opportunities in global markets. They are only the beginning however. Companies have to:

A)do their homework and adapt their products to the needs of each market.
B)withhold goods and services to global markets without trade agreements.
C)sell the products and services that are most desired.
D)wait for global governments to remove further trade barriers.

Question 57

According to Michael Porter, in most cases a firm that succeeds in global markets has first succeeded in competition.

A)intense domestic
B)moderate domestic
C)moderate international
D)intense international

Question 58

Canada's major export market is the U.S.A. and while this has been an established relationship for a long time, growing competition is coming from _.

A)China
B)Korea
C)India
D)Brazil

Question 59

Deregulation in which industry in Mexico represents an excellent opportunity for Canadian companies seeking to export their product?

A)Telecommunications
B)Entertainment
C)Food
D)Natural Gas

Question 60

According to economists, protectionism does each of the following except:

A)discourages economic dependency on foreign countries.
B)encourages the development of domestic industries.
C)encourages increased imports in protected industries.
D)protects a nation's political security.

Question 61

If you wanted to set up a business importing amber from Denmark to Canada, you would have to plan on paying Canada Customs roughly 20 percent of the value of the product as a:

A)bribe.
B)tariff.
C)revenue.
D)subsidy fee.

Question 62

All of the following would be reasons against using a social media service such as 'Vine' in India except

A)residents of India generally are considered first adopters of new social media tools
B)political restrictions may hinder the marketing message that could be shared on the social network
C)an advanced/recent social media network may not have been adopted yet
D)the social media site may not meet local customs/norms

Question 63

The EU has benefited its member nations by providing each of the following EXCEPT:

A)a common currency, the euro, adopted by all 28 members.
B)abundant marketing opportunities because it is no longer necessary to market products and services on a nation-by-nation basis.
C)European-wide distribution from fewer locations, given open borders.
D)the free flow of goods, services, capital, and labour across borders within the EU.

Question 64

An international treaty intended to limit trade barriers and promote world trade through the reduction of tariffs is known as the

A)North American Free Trade Agreement (NAFTA).
B)Restraint of Trade Treaty (ROTT).
C)North Atlantic Treaty Organization (NATO).
D)General Agreement on Tariffs and Trade (GATT).

Question 65

Negotiations are currently under way to create a Free Trade Area of the Americas which would include the United States, Canada, Mexico, Latin American countries, and:

A)Greenland.
B)Caribbean countries.
C)the Canary Islands.
D)South America.

Question 66

Tariffs serve primarily to:

A)limit the quantity of goods leaving the domestic market.
B)equalize production capacity.
C)raise prices on imports.
D)encourage foreign trade.

Question 67

One of the reasons why North American automotive manufacturers have been successful, despite the labour costs, has been because of which agreement?

A)the El Paso/Juarez Pact
B)the U.S.-Canada Fair Trade Agreement
C)the North American Free Trade Agreement
D)the Multinational Corporation Accord

Question 68

Every country engages in some form of protectionism. However, protectionism has declined internationally over the past 50 years due in large part to the:

A)International Trade Feedback Act (ITFA).
B)Balance of Trade Agreement (BOTA).
C)General Agreement on Tariffs and Trade (GATT).
D)Gross Domestic Product Agreement (GDPA).

Question 69

The primary function of the General Agreement on Tariffs and Trade (GATT)has been to limit trade barriers and promote world trade through the:

A)explicit assessing of non-tariff trade barriers of services.
B)establishment of an international Board of Commerce.
C)equalization of international quotas on manufactured goods.
D)reduction of tariffs.

Question 70

All of the following are suitable reasons why Target entered Canada except:

A)understanding that numerous Canadians cross-border shop at Target stores
B)large Canadian market potential
C)declining customer satisfaction in the USA
D)adoption of NAFTA by Canada and the USA

Question 71

The restriction on the importing of garments made in Cambodia into the U.S. is lower for those manufacturers that allow their factories to be monitored by the International Labor Organization (ILO). These restrictions are examples of:

A)foreign excise taxes.
B)quotas.
C)blocked currencies.
D)GATT taxes.

Question 72

The world's largest manufacturer of peppermint candy canes was in Albany, Georgia, until it could no longer afford to buy the sugar needed for its operation. It moved its manufacturing business to Mexico where there are no restrictions (as existed in the U.S.)on the amount of sugar that can be brought into the nation. The movement of this
U)S. business to Mexico was caused by a(n)established by the U.S.
Government.

A)excise tax
B)quota
C)tariff
D)blocked currency

Question 73

Former U.S. President Bill Clinton attempted to protect American firms from foreign competition by placing a government tax on Japanese automobiles imported to the United States. President Clinton's goal was to raise the price on Japanese imports, thereby encouraging American consumers to purchase American-made automobiles. The tax the President threatened to impose is an example of a:

A)sanction.
B)tariff.
C)quota.
D)boycott.

Question 74

What is the international agreement which includes Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Laos, Myanmar, and Cambodia?

A)APEC
B)AFTA
C)ASEAN
D)MERCOSU R

Question 75

The United States is facing an ongoing trade dispute with China over the flooding of cheap electronics into the country. This dispute is likely to be resolved by which international organization?

A)League of Nations
B)World Health Organization
C)World Trade Organization
D)International Cooperation Organization

Question 76

There are more than 160 WTO member countries, including Canada, accounting for more than percent of world trade.

A)80
B)70
C)60
D)90

Question 77

To encourage using locally-produced oil from the Gulf of Mexico, the United States government applies tax to Canadian-produced oil as it crosses the border. This tax is referred to a:

A)quota.
B)GATT tax.
C)foreign excise tax.
D)tariff.

Question 78

Which of the following issues raises a question about the ethics of protectionism?

A)Competitive advantage grows out of continuous improvement.
B)Tariffs have declined from an average of 40 percent to less than 5 percent.
C)Small firms succeed in foreign niche markets.
D)Regional trade agreements provide preferential treatment for member nations.

Question 79

There is a limit on imported television sets to the United Kingdom and Japanese motorcycles to Italy. These are examples of:

A)a government tax on goods or services entering a country.
B)the minimum quantity of goods foreign manufacturers must produce in order to keep prices competitive.
C)a government tax on goods or services leaving a country.
D)a restriction placed on the amount of a product allowed to enter or leave a country.

Question 80

According to 'bottom of the pyramid' researchers, approximately how many people live on less than $2 a day?

A)1 billion
B)2 billion
C)3 billion
D)4 billion