Deck 8: International Strategy

Question 1

Douglas and Wind (1987) challenge the view held by Levitt that a global approach is necessary. Which of the following constitute part of Douglas and Wind's argument? Please select all that apply.

A) Economies of scale are not so necessary anymore because of improved technology and greater potential for flexibility.
B) Consumer tastes are not as homogeneous as Levitt suggested.
C) Cost reduction is becoming more and more necessary.
D) The standard of living is increasing in most parts of the world.

Answer 1

A, B

Question 2

Hofstede (1991) agrees with Levitt that world tastes are converging.

Answer 2

False

Question 3

A firm exploits the differences in costs and resources that a particular country may possess. This is known as ___________________.

Answer 3

Locational advantage

Question 4

What environmental factors could motivate organizations to pursue a strategy of international diversification? Please select all that apply

A) Unsolicited proposals
B) Firm greater production capacities
C) The 'bandwagon' effect
D) Attractiveness of the host country

Question 5

According to Ghosal (1987), one of the sources of competitive advantage is scope economies. Scope economies are where the unit cost of each unit gets lower as production increases.

Question 6

The strategic objectives for a multinational corporation to adopt globalization strategy include: Please select all that apply.

A) Achieving efficiency
B) Innovation, learning, and adaptation
C) Managing risks
D) Recovery of the costs of expensive R&D more quickly

Question 7

Auto manufacturers use common platforms when making different types of cars. This allows them to achieve smaller production runs at a relatively low cost through economies of scope.

Question 8

Some of the benefits of a global strategy include: Please select all that apply.

A) Being locally responsive to differing consumer tastes.
B) Maximization of any available economies of scale.
C) Homogenization of tastes.
D) Recovery of the costs of expensive R&D more quickly.

Question 9

An international firm in the packaged convenience food industry should follow which generic international strategy?

A) Global
B) Transnational
C) Multidomestic
D) Universal

Question 10

Truly global strategies rarely exist in practice.

Question 11

Bartlett and Ghoshal argued that the unidimensional decision balancing efficiency and _______________ is no longer appropriate.

Question 12

Four generic international strategies have been identified to deal with the various challenges of internationalization. These strategies are known as global, multi-domestic, international, and _________________.

Question 13

An automobile firm uses the same engine in all of its car models across the world. It adapts some cosmetic features of the car to suit local tastes. It is following a locally responsive strategy.

Question 14

A firm exploits its core competences to expand into international markets. The centre retains autonomy. What type of strategy is this firm following?

A) Transnational
B) International
C) Multi-domestic
D) Global

Question 15

According to Bartlett and Ghoshal, a ________ recognizes the benefits of efficiency that derive from the global company, the response to local needs of the multidomestic firm, and the transfer of knowledge and capabilities across countries by the international firm.

Question 16

In selecting an appropriate entry mode into a foreign country, two questions need to be answered. These are: Please select all that apply.

A) What level of resource commitment is the firm prepared to make?
B) What level of control is required?
C) What will the entry mode cost?
D) How does the entry mode exploit core competences?

Question 17

Miller (1992) suggests that international risk consists of different elements. These are: Please select all that apply.

A) The general environment
B) Cultural
C) Industry
D) Firm specific

Question 18

Which of the following entry modes can be considered as having the lowest risk and the lowest amount of ownership and control?

A) Wholly owned subsidiary
B) Strategic alliance
C) Exporting
D) Franchising

Question 19

Which type of international strategy did Levitt (1983) believe to be most appropriate for the international business context at that time?

A) Global
B) Multi-domestic
C) Transnational
D) International

Question 20

Many international companies such as McDonald's, Benetton, and Pizza Hut adopted franchising as their entry-mode strategy to enter international markets.

Question 21

A useful alliance will be beneficiary for both organizations as: Please select all that apply

A) It involves complementary resources and capabilities
B) It allows both organizations to grow and develop according to their strategic objectives
C) Both learn from their partners
D) Managerial differences exist

Question 22

FDI is the abbreviation for _____________________.

Question 23

Worker skills that have developed in a particular country are (in terms of Porter's Diamond):

A) Related and supporting industry condition
B) Firm structure, strategy and rivalry condition
C) Demand condition
D) Factor condition

Question 24

According to Porter's Five Forces framework, national competitive factors include factor condition, demand conditions, related and supporting industries, and firm strategy, structure, and rivalry.

Question 25

The geographic grouping known as the triad consists of:

A) Japan, China, and Russia
B) Japan, Europe, and USA
C) China, Europe, and USA
D) India, Russia, and China

Question 26

Rugman and D'Cruz (1991) suggest a _____________________ to more fully take account of the determinants of international competitiveness. For example, Canada's international competitiveness is determined by conditions in neighbouring USA as well as Canada.

Question 27

Ghemawat (2005) argues that globalization is more accurately described as:

A) Multi-localization.
B) Cultural imperialism.
C) Globalization.
D) Regionalization.

Question 28

Internationalization in services is different to internationalization of products.

Question 29

Continuing economic liberalization and information technology are the backdrop to the changes facing the traditional multinational corporation to evolve into a globally integrated enterprise.

Question 30

Globalization faces lots of challenges, such as: Please select all that apply

A) A key challenge in the global economy is how to prevent piracy of intellectual property rights without sacrificing collaboration.
B) How do firms maintain trust when their business models are dispersed globally?
C) Some of the changes that global corporate integration brings will require that capital markets and investors adjust their habits from short-term rewards to longer-term growth.
D) Developing countries experience increased employment and prosperity as their workers become more integrated into global production systems.