Deck 19: The Global Marketplace

Question 1

Foreign businesses in China appear to receive unusually close scrutiny and harsh treatment from Chinese authorities, aimed at boosting the fortunes of local competitors. This is an example of a(n) ________.

A) nontariff trade barrier
B) tariff
C) boycott
D) exchange control
E) quota

Answer 1

A

Question 2

The ________ was established to replace GATT in 1995 and now oversees the original GATT provisions.

A) WTO
B) EU
C) NAFTA
D) CAFTA
E) NATO

Answer 2

A

Question 3

Bias against bids made by American companies is an example of a(n) ________.

A) quota
B) tariff
C) boycott
D) nontariff trade barrier
E) exchange control

Answer 3

D

Question 4

Firms that stay at home to play it safe ________.

A) protect themselves from competition at home
B) gain a competitive edge against imports in their home markets
C) successfully shield themselves from foreign competition
D) risk losing their home markets
E) increase their chances of entering other markets

Question 5

Which of the following terms refers to a tax levied by a foreign government against certain imported products?

A) embargo
B) tariff
C) excise
D) exchange control
E) quota

Question 6

Which of the following is most likely to be the consequence of increase in growth of global trade?

A) Home markets become richer in opportunities.
B) Foreign firms expand aggressively into new international markets.
C) Global competition is curbed.
D) Industries become safe from foreign competition.
E) Domestic companies increase their chances to dominate their home markets.

Question 7

According to the text, what location does Coca-Cola consider a "promising long-term growth opportunity"?

A) Russia
B) Brazil
C) China
D) Africa
E) India

Question 8

Which of the following is a risk associated with international trade?

A) technological obsolescence
B) highly unstable governments
C) market monopolization
D) lack of trade barriers
E) currency stagnation

Question 9

Which of the following is a nontariff trade barrier?

A) strike
B) quota
C) boycott
D) exchange premium
E) restrictive product standards

Question 10

Growing Green, a U.S. company that markets organic and environmentally friendly gardening and landscaping supplies and equipment, wants to expand the business internationally. Growing Green managers are currently examining the rules imposed by the WTO and the agreements made by NAFTA and the EU. In which stage of the international marketing process is Growing Green?

A) deciding on the global pricing strategies
B) deciding which markets to enter
C) deciding how to enter the market
D) deciding on the global marketing program
E) looking at the global marketing environment

Question 11

Which of the following characterizes U.S. companies in the past?

A) They paid significant attention to international trade.
B) Their biggest markets were in other countries.
C) The home market was much safer than the foreign market.
D) They disregarded political and legal risks overseas.
E) They adapted products to foreign customer needs.

Question 12

A ________ firm is one that, by operating in more than one country, gains marketing, production, research and development, and financial advantages that are not available to purely domestic competitors.

A) global
B) domestic
C) federally chartered
D) direct investment
E) free trade zone

Question 13

Which of the following was a result of the Uruguay Round of global WTO trade talks?

A) It increased the world's remaining merchandise tariffs by 30 percent.
B) It minimized the international protection of copyrights, patents, and trademarks.
C) It extended the WTO to cover trade in agriculture and a wide range of services.
D) It established the NATO for purposes of collective security.
E) It established the EU to reduce trade barriers and increase cooperation among its members.

Question 14

Immediately after deciding which markets to enter, the company should determine ________.

A) the most suitable global communication program
B) how to price its products in different markets
C) the global marketing organization
D) the global marketing program
E) how to enter the market

Question 15

A(n) ________ is a limit on the amount of goods that an importing country will accept in certain product categories.

A) embargo
B) tariff
C) benchmark
D) quota
E) exchange control

Question 16

Which of the following was designed to help foster trade between nations?

A) tariffs
B) GATT
C) exchange controls
D) quotas
E) nontariff trade barriers

Question 17

Which question should most likely be answered by all companies due to the rapid move toward globalization?

A) How should we eliminate domestic competition?
B) Should we diversify in a new business area in the home country?
C) Where should we produce or source our products?
D) How should we fulfill our environmental obligations?
E) Which medium of advertising should we use in our home country?

Question 18

The ________, established in 1947 and modified in 1994, was designed to promote world trade by reducing tariffs and other international trade barriers.

A) OPEC
B) GATT
C) EU
D) ASEAN
E) NAFTA

Question 19

Which of the following major decisions should be taken by a company immediately after it decides to operate internationally?

A) deciding which markets to enter
B) deciding how to enter the market
C) deciding on the global marketing organization
D) deciding on the global marketing program
E) deciding on the global communication program

Question 20

A(n) ________ serves to limit the amount of foreign exchange and the exchange rate against other currencies.

A) exchange premium
B) free trade zone
C) quota
D) exchange control
E) tariff trade barrier

Question 21

In a(n) ________, the vast majority of people engage in simple agriculture and consume most of their output.

A) raw material economy
B) subsistence economy
C) industrializing economy
D) emerging economy
E) industrial economy

Question 22

Which of the following is an example of a raw material exporting economy?

A) Sweden
B) Russia
C) the United Kingdom
D) Chile
E) Brazil

Question 23

In 1994, ________ established a free trade zone among the United States, Canada, and Mexico.

A) GATT
B) WTO
C) NAFTA
D) EU
E) CAFTA

Question 24

Economic communities are also known as ________.

A) global firms
B) free trade zones
C) management communities
D) production communities
E) open channels

Question 25

Trusted Wholesalers is a company that currently purchases products made in Mexico and sells them to companies based in the United States and Canada. Trusted Wholesalers is considering whether to also purchase products produced in Costa Rica and the Dominican Republic. To make their decision, members of management at Trusted Wholesalers will most likely evaluate the agreements made by ________.

A) the EU
B) NAFTA
C) CAFTA-DR
D) MCAN
E) UNASUR

Question 26

In a(n) ________ economy, fast growth in manufacturing results in rapid overall economic growth.

A) industrial
B) industrializing
C) materials exporting
D) subsistence
E) agrarian

Question 27

Which of the following is a threat posed by the EU?

A) Europe could heap favors on firms from EU countries but hinder outsiders by imposing obstacles.
B) European companies have become less competitive.
C) European companies have begun to monopolize international markets.
D) The EU has toughened the international protection of copyrights, patents, and trademarks.
E) The EU has reduced Europe's remaining merchandise tariffs by 30 percent.

Question 28

Coffee, tea, cotton, and tobacco are the main exports of Uganda. It is most likely that Uganda has a(n) ________ economy.

A) subsistence
B) marketing
C) merchandise exporting
D) raw material exporting
E) industrializing

Question 29

Which of the following industrial structures presents the fewest market opportunities?

A) subsistence economies
B) raw material exporting economies
C) industrializing economies
D) emerging economies
E) industrial economies

Question 30

Trusted Wholesalers is a company that purchases products produced in Mexico and sells them to companies based in the United States and Canada. Management at Trusted Wholesalers would most likely be interested in becoming experts in the policies developed by the ________.

A) EU
B) NAFTA
C) CAFTA-DR
D) APTA
E) BRIC

Question 31

Formed in 1957, the ________ set out to create a single European market by reducing barriers to the free flow of products, services, finances, and labor among member countries and developing policies on trade with nonmember nations.

A) Uruguay Round
B) European Union
C) European Organization
D) European Central Bank
E) CAFTA

Question 32

A(n) ________ economy is rich in one or more natural resources but poor in other ways and much of its revenue comes from exporting its natural resources.

A) industrial
B) industrializing
C) raw material exporting
D) subsistence
E) agrarian

Question 33

In 2005, the ________ established a free trade zone between the United States and Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua.

A) CAFTA-DR
B) FTAA
C) CAN
D) NAFTA
E) EU

Question 34

The EU helped unify Europe by adopting the ________ as a common currency.

A) Eurodollar
B) euro
C) franc
D) Deutsche Mark
E) peseta

Question 35

A(n) ________ community is a group of nations organized to work toward common goals in the regulation of international trade.

A) joint venture
B) strategic marketing
C) economic
D) joint-stock
E) multilateral

Question 36

A country's ________ shapes its product and service needs, income levels, and employment levels.

A) international trade system
B) income distribution
C) industrial structure
D) political structure
E) foreign exchange system

Question 37

Which of the following is an example of an economic community?

A) NATO
B) BRIC
C) NAFTA
D) GATT
E) WTO

Question 38

The two key economic factors reflecting a country's attractiveness as a market are its industrial structure and its ________.

A) communication adaptation
B) nontariff trade barriers
C) exchange controls
D) income distribution
E) transportation systems

Question 39

Formed in 2004 and formalized in 2008, ________ makes up the largest trading block after NAFTA and the European Union.

A) CAFTA-DR
B) FTAA
C) UNASUR
D) MCAN
E) GATT

Question 40

Which of the following is a type of industrial structure?

A) marketing economies
B) subsistence economies
C) laissez-faire economies
D) capitalistic economies
E) socialistic economies

Question 41

________ are major exporters of manufactured goods, services, and investment funds.

A) Raw material exporting economies
B) Subsistent economies
C) Industrializing economies
D) Industrial economies
E) Emerging economies

Question 42

Which of the following is a geographic factor that a company should consider before deciding to enter into a new country?

A) climate
B) population size
C) GDP size and growth
D) government bureaucracy
E) business norms and approaches

Question 43

If Azerbaijan imported wheat from Romania in exchange for crude oil, and Vietnam exchanged rice for Philippine fertilizer and coconuts then these scenarios would be examples of ________.

A) cash transaction
B) compensation
C) buyback
D) blocked currency
E) barter

Question 44

Which of the following is a demographic factor that a company should consider before deciding to enter into a new country?

A) transportation structure
B) natural resources
C) political stability
D) languages
E) education

Question 45

Foreign businesses in China appear to receive unusually close scrutiny and harsh treatment from Chinese authorities, aimed at boosting the fortunes of local competitors. This includes trade tariffs, quotas, restrictions, etc. This reflects that a country's ________ should be carefully considered before doing business in that country.

A) political-legal environment
B) industrial structure
C) cultural norms
D) natural resources
E) income distribution

Question 46

Which of the following is an example of an industrial economy?

A) Japan
B) China
C) Vietnam
D) India
E) North Korea

Question 47

The United States and Norway are examples of ________ economies.

A) subsistence
B) industrializing
C) emerging
D) industrial
E) raw material exporting

Question 48

Which of the following is the LEAST critical decision a company should make before going abroad?

A) Can the company learn to understand buyer behavior of consumers in other countries?
B) Can the company offer competitively attractive products?
C) Can the company adapt to other countries' business cultures?
D) How many foreign nationals should the company employ?
E) Do the company's managers have the necessary international experience?

Question 49

Demographic characteristics, geographic characteristics, economic factors, sociocultural factors, and political and legal factors all help a company ________.

A) determine a market's potential
B) determine a country's degree of globalization
C) evaluate its marketing objectives
D) evaluate its value delivery network
E) determine a country's income distribution

Question 50

Which of the following involves the direct exchange of goods and services?

A) cash transaction
B) compensation
C) buyback
D) blocked currency
E) barter

Question 51

Countries with ________ economies consist mostly of households with very low family incomes.

A) industrial
B) industrializing
C) raw material exporting
D) emerging
E) subsistence

Question 52

Which of the following is a sociocultural factor that a company should consider before deciding to enter into a new country?

A) political stability
B) population density (urban vs. rural)
C) education
D) income distribution
E) consumer lifestyles, beliefs, and values

Question 53

Nike inadvertently offended Chinese officials when it ran an ad featuring LeBron James crushing a number of revered Chinese figures in a kung fu-themed television ad. As a result, Nike has to release a formal apology. This is an example of the impact of ________ on marketing strategy.

A) culture
B) political stability
C) level of industrialization
D) income distribution
E) monetary regulations

Question 54

Sellers might accept a(n) ________, one whose removal from the country is restricted by the buyer's government, if they can buy other goods in that country that they need themselves or can sell elsewhere for a needed currency.

A) blocked currency
B) countervailing duty
C) custom duty
D) anti-dumping duty
E) tariff

Question 55

Industrializing economies are also known as ________ economies.

A) emerging
B) raw material exporting
C) totalitarian
D) subsistence
E) capitalist

Question 56

BRIC countries are examples of ________ economies.

A) raw material exporting
B) industrializing
C) subsistence
D) industrial
E) totalitarian

Question 57

Which of the following characterizes emerging economies?

A) Industrialization typically creates a new rich class and a growing middle class, both demanding new types of imported goods.
B) They trade goods among themselves and also export them to other types of economies for raw materials and semifinished goods.
C) Most African countries fall into this category.
D) They consume most of their output and barter the rest for simple goods and services.
E) These countries are the best markets for large equipment, tools and supplies, and trucks.

Question 58

Which of the following would a defender of globalization most likely use as an example to argue that concerns of Americanization are overblown and that globalization is indeed a two-way street?

A) the view of McDonald's being a domestic brand in China
B) the growing popularity of coffee in China since the introduction of Starbucks
C) the growing number of IKEA furniture stores in the United States
D) the initial failure of Disneyland Paris
E) the anti-globalization protests aimed at KFC

Question 59

India needs more imports of raw materials such as textiles, steel, and heavy machinery and fewer imports of finished textiles, paper products, and automobiles. In the context of industrial structures, India is most likely a(n) ________ economy.

A) subsistence
B) totalitarian
C) raw material exporting
D) agrarian
E) industrializing

Question 60

The BRIC countries are ________.

A) Bolivia, the Republic of Haiti, Israel, and Chile
B) Britain, the Republic of the Marshall Islands, Ireland, and the Commonwealth of Australia
C) Brazil, Russia, India, and China
D) Burundi, Rwanda, Ivory Coast, and Congo
E) Belarus, Romania, Iceland, and Czech Republic

Question 61

Which of the following is true of contract manufacturing?

A) It provides a chance to start faster but with more risks.
B) It involves decreased control over the manufacturing process.
C) It leads to an increase in potential profits on manufacturing.
D) It is the simplest way to enter a foreign market.
E) It involves entering a foreign market by exporting the surplus products.

Question 62

Sears opened up department stores in Mexico and Spain, where it found qualified local manufacturers to produce many of the products it sells. This type of joint venture is known as ________.

A) joint ownership
B) licensing
C) management contracting
D) indirect exporting
E) contract manufacturing

Question 63

Which of the following is a type of joint venturing?

A) trade embargo
B) licensing
C) direct investment
D) direct exporting
E) indirect exporting

Question 64

In Japan, Budweiser beer flows from Kirin breweries, and Moringa Milk Company produces Sunkist fruit juice. These are examples of ________.

A) contract manufacturing
B) management contracting
C) licensing
D) joint venturing
E) directly investment

Question 65

The simplest way to enter a foreign market is through ________.

A) joint venturing
B) direct investment
C) exporting
D) joint ownership
E) contract manufacturing

Question 66

Think Ink is a growing company that sells a variety of inks for home and business printers. Management at Think Ink has decided to open a sales branch overseas to handle sales and distribution abroad. Think Ink is engaging in ________.

A) indirect exporting
B) direct exporting
C) licensing
D) joint ownership
E) management contracting

Question 67

Which of the following is an economic factor that a company should consider before deciding to enter into a new country?

A) population size and growth
B) natural resources
C) cultural and social norms
D) political stability
E) climate

Question 68

Which of the following is a political and legal factor that a company should consider before deciding to enter into a new country?

A) monetary and trade regulations
B) transportation structure
C) population size and growth
D) industrial infrastructure
E) business norms and approaches

Question 69

In the case of ________ exporting, sellers handle their own exports.

A) direct
B) licensed
C) indirect
D) countervailing
E) multilateral

Question 70

When entering a foreign market, companies typically start with ________, working through independent intermediaries to sell products produced in the home country.

A) direct exporting
B) embargo
C) product adaptation
D) indirect exporting
E) licensing

Question 71

Members of management at Growing Green, a company that markets organic and environmentally friendly gardening and landscaping supplies and equipment, are evaluating the benefits and disadvantages of indirect exporting, direct exporting, and licensing. In which stage of the international marketing process is Growing Green?

A) deciding on the global advertising strategy
B) deciding which markets to enter
C) deciding how to enter the market
D) deciding on the global marketing program
E) deciding on the global marketing organization

Question 72

Hilton helps others run their hotels by providing the management know-how. This type of joint venture is known as ________.

A) contract manufacturing
B) licensing
C) management contracting
D) joint ownership
E) direct investment

Question 73

Campbell Soup recently joined forces with Hong Kong-based Swire Pacific to form an entity called Campbell Swire-to better distribute the company's soups in China. This is an example of ________.

A) licensing
B) contract manufacturing
C) management contracting
D) joint ownership
E) indirect exporting

Question 74

________ involves entering a foreign market by developing foreign-based assembly or manufacturing facilities.

A) Indirect exporting
B) Direct investment
C) Joint venturing
D) Contract manufacturing
E) Direct exporting

Question 75

________ means adjusting the marketing strategy and mix elements to each international target market.

A) Standardized global marketing
B) Ambush marketing
C) Adapted global marketing
D) Mass marketing
E) Whole channel viewing

Question 76

Through ________, an organization in the foreign market buys the right to use a company's manufacturing process, trademark, patent, trade secret, or other item of value.

A) indirect exporting
B) licensing
C) contract manufacturing
D) management contracting
E) joint ownership

Question 77

________ involves essentially using the same marketing strategy approaches and marketing mix worldwide

A) Adapted global marketing
B) Ambush marketing
C) Standardized global marketing
D) Export marketing
E) Niche marketing

Question 78

Which of the following characterizes indirect exporting?

A) It requires more investment than joint venturing.
B) It requires an overseas marketing organization or network.
C) It involves less risk and investment than other entry methods.
D) The potential returns are greater than direct exporting.
E) It involves joining with foreign companies to produce or market products or services.

Question 79

________ ventures consist of one company joining forces with foreign investors to create a local business in which they share ownership and control.

A) Joint ownership
B) Licensing
C) Contract manufacturing
D) Management contracting
E) Indirect exporting

Question 80

Lower costs in the form of cheaper labor or raw materials, foreign government investment incentives, freight savings, and the opportunity to improve the company image are the factors that would most likely lead a company to enter a foreign market using the market entry strategy of ________.

A) direct exporting
B) licensing
C) management contracting
D) indirect exporting
E) direct investment