Deck 4: Managing in a Global Environment

Question 1

 Virtually all U.S. industrial exports into Canada and Mexico are now duty-free due to the North American Free Trade Agreement (NAFTA).

Answer 1

True

Question 2

 With exporting, the company transfers its products for sale and maintains its production facilities in foreign countries.

Answer 2

False

Question 3

 There are three components to cultural intelligence: cognitive, emotional, and physical.

Answer 3

True

Question 4

 Exporting is cheaper than outsourcing and partnerships as a way for organizations to do business internationally.

Question 5

 An increasing number of large international corporations are located in the United States.

Question 6

 An example of global outsourcing is seen when Gap Inc. uses low-cost Caribbean labor to cheaply produce its clothing, and then finishes off and sells its clothing in the United States.

Question 7

 Business, just like crime, has become a unified, global field.

Question 8

 Since 2005, the number of Global 500 companies in the Americas and Europe has declined.

Question 9

 China is the industry leader in information technology outsourcing.

Question 10

 A global mind-set requires skills, understanding, and competencies in three dimensions: technological, psychological, and social.

Question 11

 China has the fastest-growing middle class in history.

Question 12

 One result of globalization is that countries, businesses, and people become increasingly independent.

Question 13

 Whereas China is strong in software design, services, and precision engineering, India is strong in manufacturing.

Question 14

 Government officials and the general public are often suspicious of foreign companies' impact on economic independence and political sovereignty.

Question 15

 The basic management functions of planning, organizing, leading, and controlling are the same whether a company operates domestically or internationally.

Question 16

 The goal of the European Union is to create a powerful single-market system for Europe's millions of consumers.

Question 17

 The term top of the pyramid refers to the more than 4 billion people who make up the lowest level of the world's economic "pyramid," as defined by per capita income.

Question 18

 Ethnocentrism refers to a person's ability to use reasoning and observation skills to interpret unfamiliar gestures and situations and devise appropriate behavioral responses.

Question 19

 A natural tendency of people to regard their own culture as superior and to downgrade or dismiss other cultural values reflects an attitude called geocentrism.

Question 20

 Licensing means engaging in the international division of labor so that work activities can be done in countries with the cheapest sources of labor and supplies.

Question 21

 Social values greatly influence organizational functioning and management styles.

Question 22

 Learning by doing means cultivating relationships with people across cultural and national boundaries.

Question 23

 Collectivism means a preference for a tightly knit social framework in which individuals look after one another and organizations protect their members' interests.

Question 24

 Implicit communication refers to spoken words when talking with others.

Question 25

 Many managers fail to realize that the values and behaviors that typically govern how business is done in their own country don't always translate to the rest of the world.

Question 26

 A low-context culture is a culture in which communication is used primarily to build personal social relationships.

Question 27

 Geocentric companies are truly world-oriented and favor no specific country.

Question 28

 The primary emphasis of polycentric companies is on their home countries.

Question 29

 A high performance orientation means that a society encourages toughness, assertiveness, and competitiveness.

Question 30

 Partnerships represent a lower level of involvement in international trade than does exporting and outsourcing.

Question 31

 High power distance means that people expect equality in power among institutions, organizations, and people.

Question 32

 Market risk is defined as the risk of loss of assets, earning power, or managerial control due to politically based events or actions by host governments.

Question 33

 A multinational corporation is managed as an integrated worldwide business system.

Question 34

 According to the GLOBE Project value dimensions, Japan and Russia both have very high performance orientation.

Question 35

 The European Union (EU) was established by the Uruguay Round in 1995.

Question 36

 According to the GLOBE Project, gender differentiation refers to the extent to which a society maximizes gender role differences.

Question 37

 The social value of uncertainty avoidance is evident in countries like Japan which support beliefs that promises certainty and conformity among its citizenry.

Question 38

 A multinational corporation typically receives more than 25 percent of its total sales revenues from operations inside the parent's home country.

Question 39

 According to the GLOBE Project, a society with a high performance orientation places great emphasis on performance and rewards people for performance improvements and excellence.

Question 40

 Cultural intelligence refers to a person's ability to use reasoning and observation skills to interpret unfamiliar gestures and situations and devise appropriate behavioral responses.

Question 41

 Exporting and partnerships are called __________ strategies because they represent alternative ways to sell products and services in foreign markets.

A) globalized
B) expansion
C) retrenchment
D) market-entry
E) concentrated business

Question 42

 Succeeding on a global level requires that managers and organizations develop a(n):

A) global mind-set.
B) ethnocentric attitude.
C) boundary mind-set.
D) customer centric strategy.
E) long-term orientation.

Question 43

 Many companies first get involved internationally by using which of the following approaches?

A) Exporting
B) Offshoring
C) Joint venture
D) Acquisition
E) Outsourcing

Question 44

 Today's companies compete in a:

A) growingly domestic environment.
B) low-context culture.
C) high-context culture.
D) corrupt world.
E) borderless world.

Question 45

 The extent to which trade and investments, information, social and cultural ideas, and political cooperation flow between countries is called:

A) standardization.
B) industrialization.
C) globalization.
D) internationalism.
E) multinationalism.

Question 46

 Which of the following are the three components of cultural intelligence?

A) Physical, cognitive, and psychological
B) Cognitive, analytical, and physical
C) Emotional, technological, and psychological
D) Analytical, psychological, and cognitive
E) Cognitive, emotional, and physical

Question 47

 Most managers aren't equally strong in all three areas of cultural intelligence.

Question 48

 As a first step into international business, which two countries are most companies going to today?

A) Russia and Japan
B) Sweden and Germany
C) China and India
D) Brazil and the Philippines
E) Indonesia and Brazil

Question 49

 A high-context interaction requires more time because a relationship has to be developed, and trust and friendship must be established.

Question 50

 Which of the following is an entry strategy in which the company maintains its production facilities within its home nation and transfers its products for sale in foreign countries?

A) Offshoring
B) Contracting
C) Exporting
D) Outsourcing
E) Joint venture

Question 51

 The __________ concept proposes that corporations can alleviate poverty and other social ills, as well as make significant profits, by selling to the world's poorest people.

A) cream of the crop
B) skimming the barrel
C) bottom of the pyramid
D) top of the peak
E) base hierarchy

Question 52

 The maquiladora industry along the Texas-Mexico border on the Mexico side uses cheap labor for assembling products. This lowers the price for U.S. consumers and is an example of:

A) contracting.
B) a joint venture.
C) outsourcing.
D) exporting.
E) none of these.

Question 53

 __________ companies place an emphasis on a worldwide perspective.

A) Polycentric
B) Geocentric
C) Ethnocentric
D) Regiocentric
E) Domestic

Question 54

 A global mind-set requires skills, understanding, and competencies in which of the following three dimensions?

A) Cognitive, behavioral, and social
B) Behavioral, psychological, and social
C) Emotional, psychological, and cognitive
D) Cognitive, psychological, and social
E) Social, psychological, and technological

Question 55

 Ethnocentrism refers to a natural tendency of people to regard their own culture as inferior to other cultures.

Question 56

 Digitec Company has recently decided to design and manufacture a laptop that retails for under $50, in an effort to make information technology available to people in places like rural Africa and rural India. This is known as what type of strategy?

A) Bottom of the pyramid
B) Skimming the barrel
C) Cream of the crop
D) Top of the peak
E) Base hierarchy

Question 57

 German, Swiss, and North American cultures are considered to be high-context cultures.

Question 58

 Go RVing, a U.S. company, is looking to enter the market in Europe. The cheapest way for Go RVing to do so would be:

A) offshoring.
B) exporting.
C) a joint venture.
D) outsourcing.
E) contracting.

Question 59

 Which of the following refers to engaging in the international division of labor so that work activities can be done in countries with the cheapest sources of labor and supplies?

A) Exporting
B) Joint ventures
C) Contracting
D) Outsourcing
E) None of these

Question 60

 Learning by thinking requires:

A) a genuine curiosity about other people and cultures.
B) an interest in and study of international business.
C) the ability to open your mind.
D) appreciating different viewpoints.
E) all of these.

Question 61

 Which of the following management functions changes when a business operates internationally?

A) Planning
B) Organizing
C) Controlling
D) Leading
E) None of these

Question 62

 Which of the following statements about India is not true?

A) India is the world's largest exporter of generic drugs.
B) India has the fastest-growing middle class in history.
C) India is the industry leader in information technology outsourcing. 
D) One of the fastest-growing industries in India is pharmaceuticals.
E) India has a large English-speaking population.

Question 63

 Kimberly values the relationships she has with her coworkers, and prefers working and making decisions in groups rather than by herself. According to Hofstede's value dimensions, Kimberly scores __________ in __________.

A) high; individualism
B) high; femininity
C) low; power distance
D) low; collectivism
E) high; uncertainty avoidance

Question 64

 One result of globalization is that countries, businesses, and people have become:

A) less ethical.
B) increasingly independent.
C) decreasingly technological savvy.
D) increasingly interdependent.
E) more ethical.

Question 65

 The psychological dimension of a global mind-set includes all of the following except:

A) the ability to behave in ways that build trusting relationships with people who are different from oneself.
B) a liking for diverse ways of thinking and acting.
C) the energy to deal with the unpredictable and uncertain.
D) a willingness to take risks.
E) the self-confidence to deal with the unpredictable and uncertain.

Question 66

 Timothy, a student at Rhodes College, is interested in expanding his global mind-set. Which of the following activities would help Timothy?

A) Learn a foreign language
B) Study abroad
C) Travel overseas
D) None of these
E) All of these

Question 67

 According to a report by PricewaterhouseCoopers, India's __________ industry will likely be a global leader by 2020.

A) consumer electronics
B) oil and gas
C) manufacturing
D) pharmaceuticals
E) automotive

Question 68

 The term bottom of the pyramid refers to the more than 4 billion people who earn less than US__________ a year.

A) $1,500
B) $2,500
C) $3,500
D) $5,000
E) $10,000

Question 69

 Sarah works at a U.S.-based company that gets most of its sales from Europe, more than half of the company's managers are non-American, and its employees work in five different countries. Based on this information, Sarah works at a(n):

A) joint venture.
B) bossless corporation.
C) ethnocentric company.
D) multinational corporation.
E) transglobal corporation.

Question 70

 The __________ is the largest regional agreement in history.

A) North American Free Trade Agreement
B) European Union
C) General Agreement on Tariffs and Trade
D) European Free Trade Area
E) Trans-Pacific Partnership

Question 71

 Which of the following individuals would most likely prefer lower context communication?

A) Kyung, a Korean female
B) Lisa, a white female
C) Shawn, a white male
D) Ahanu, a Native American male
E) Jermaine, an African-American male

Question 72

 The management of business operations conducted in more than one country is called:

A) global management.
B) international management.
C) multinational management.
D) domestic management.
E) none of these.

Question 73

 Which of the following statements regarding the three strategies for entering business internationally is true?

A) Global outsourcing has a higher cost to enter foreign operations than does partnerships.
B) Exporting has more risk involved than does global outsourcing and partnerships.
C) Global outsourcing has the lowest level of ownership of foreign operations.
D) Partnerships have the highest level of ownership of foreign operations.
E) Partnerships have the lowest cost to enter foreign operations.

Question 74

 Which of the following individuals would more likely be able to develop a global mind-set more easily?

A) Mathias, who is fluent in four different languages
B) Will, who has never traveled outside the United States
C) Mariana, who speaks English as a second language
D) Savannah, who attends a women's college
E) Vera, whose parents were born in Germany

Question 75

 Whereas China is strong in __________, India is a rising power in __________.

A) electronics; manufacturing
B) manufacturing; food processing
C) services; manufacturing
D) manufacturing; software design
E) services; software design

Question 76

 Riots, revolutions, civil disorders, and frequent changes in government are all examples of:

A) political risk.
B) political chaos.
C) political instability.
D) events that typically occur in low-context cultures.
E) none of these.

Question 77

 The __________ dimension of a global mind-set means knowing about the global environment and global business, mentally understanding how cultures differ, and having the ability to interpret complex global changes.

A) emotional
B) psychological
C) cognitive
D) social
E) analytical

Question 78

 Starbucks has used __________ to expand in China and India.

A) offshoring
B) joint ventures
C) exporting
D) outsourcing
E) all of these

Question 79

 Your company is interested in producing and marketing a line of coffee that will penetrate the Chinese market. This is the first time your company has gotten involved internationally, so you are being cautious and would initially like to spend the least amount of money as possible to get involved. What type of strategy are you going to use?

A) Contracting
B) Outsourcing
C) Exporting
D) Partnership
E) Offshoring

Question 80

 Angela works at a company that emphasizes competitiveness between its employees. Angela works at a company __________ in __________.

A) high; humane orientation
B) high; assertiveness
C) low; performance orientation
D) high; gender differentiation
E) low; future orientation