Question 1

Some transformative MNEs go beyond commercial relationships with their consumers and offer their products and services to those who most desperately need them,regardless of their ability to pay.

Accepted Answer

A) True 
 B)False  True

Question 2

Progress in reducing global poverty has been observed to be more closely associated with investments by MNEs than it has with the foreign aid efforts of national governments and non-governmental organizations that have historically demonstrated a lack of business experience.

Accepted Answer

A) True 
 B)False  True

Question 3

Which of the following are not characteristic of the attitudes of transactional MNEs in the context of their relationships with stakeholders

Accepted Answer

A)   obeys local laws and regulations but uses country differences to gain competitive advantage
B)   makes product adaptations if they are economically viable and can increase market share
C)   defers responsibility for its social or environmental impact
D)   focuses on shareholder returns. C

Question 4

Which,if any,of the following business activities are likely to be acceptable to business ethicists:

Accepted Answer

A)   following local custom and paying bribes to local government officials to secure legal concessions and subsidies.
B)   negotiating aggressively with suppliers to secure low input costs.
C)   relentlessly pursuing low-cost labor by investing in countries with weaker labor regulations and standards.
D)   seeking market expansion, regardless of the likely resulting economic, social or cultural damage.

Question 5

You are employed by a large national chemical manufacturing firm that is considering its first investment in an emerging market.Your boss is concerned - while she senses an unprecedented opportunity to grow the firm,she is also mindful of the demonstrations surrounding a recent gathering of world leaders in which activists voiced a wide range of concerns over the perils of globalization.She appreciates the need to position the chemical manufacturing firm in the eyes of prospective stakeholders,but is unsure where to target. In the hopes of establishing a position that is neither overly exploitative,nor overly transformative,your boss has asked you for a report detailing the two most extreme positions that the chemical manufacturing firm could occupy.Compare and contrast these two characterizations of the MNE-stakeholder relationship in emerging markets,providing examples you think will illustrate your position.

Accepted Answer

The answer of You are employed by a large national...

Question 6

In the 1970s,Nobel economist Milton Friedman advocated all of the following behaviours by MNEs,except:

Accepted Answer

A)   focusing only on the interests of shareholders.
B)   avoiding pollution.
C)   maximizing profits.
D)   leveraging cross-country differences in wages.

Question 7

Which of the following four adjectives are not typically used to describe the manner in which MNEs might respond to developing world needs:

Accepted Answer

A)   transformative.
B)   transactional.
C)   exploitative.
D)   compensatory.

Question 8

The Global Compact is a legislated and enforceable code that provides a way for MNEs to have a more responsive and constructive role in the developing world.

Accepted Answer

A) True 
 B)False

Question 9

While the two extreme characterizations of the MNE-stakeholder relationship (exploitative and transformative)tend to garner the most media attention,it is the more moderate perspectives of the MNE-stakeholder relationship (transactional and responsive)that tend to predominate in the context of FDI in emerging markets.However,given that these two perspectives represent the middle ground along the spectrum between exploitative and transformative,the distinctions between transactional and responsive characterizations of the MNE-stakeholder relationship in emerging markets are occasionally blurred.Clarify the differences between the transactional and responsive perspectives by comparing and contrasting the two characterizations,using examples that you think illustrate your position.

Accepted Answer

The answer of While the two extreme characterizations of the...

Question 10

Responsive MNEs act in a way that is sensitive and responsive to the needs of all its immediate stakeholders.

Accepted Answer

A) True 
 B)False

Question 11

The relationship between transactional MNEs and non-governmental organizations (NGOs)is frequently characterized by confrontation and accusation.

Accepted Answer

A) True 
 B)False

Question 12

As the geographic (country)manager for a rapidly expanding multinational industrial manufacturer,you are responsible for managing the manufacturing operations in a developing economy.Business is fantastic.Pursuing the mandate given to you by your boss ("your job is to win at any cost"),your annual bonus alone has grown at a compounded annual rate of 50% over the past three years.Yet,your conscience has also been growing heavy.You have come under increasing local pressure as a consequence of an indigenous newspaper reporter's efforts to investigate the following incidents associated with your operations: (i)the high incidence of infant mortality experienced in households situated adjacent to a lake into which your plant is discharging effluents; (ii)the recent attempted suicide of two employees who were told that they would lose their jobs if they did not agree to extend their workday by four hours,despite already working eleven hours per day during a six day work week; and,(iii) the allegation that your domestic managers regularly secure expedited customs clearance for the raw materials needed at your manufacturing plant by taking local officials on jaunts to a nearby casino.A telephone conversation with a trusted mentor-professor from the college where you earned your business degree leads to the professor urging you to consider either leaving the company or,initiating an appeal to headquarters to change its exploitative ways in favour of becoming more responsive in its foreign business dealings.You choose to accept the challenge of appealing to headquarters and decide to write a memo to initiate your efforts.However,you are cognizant that while you are familiar with the distinction between exploitative and responsive approaches adopted by MNEs,headquarters may dismiss these terms as "academic mumbo jumbo." What should you say in your memo to headquarters?

Accepted Answer

The answer of As the geographic (country)manager for a rapidly...

Question 13

MNEs that internationalize in developing countries have encountered all of the following differences pertaining to the labor force,except:

Accepted Answer

A)   lower wages and fewer restrictions on living standards.
B)   greater number of hours worked per week.
C)   higher standards with respect to working conditions.
D)   lower standards for human rights.

Question 14

The primary difference between transactional MNEs and exploitative MNEs is that the former employs an approach that tends to be legally compliant and non-oppressive in its emerging market dealings.

Accepted Answer

A) True 
 B)False

Question 15

A short-term challenge for MNEs is to determine whether they are willing to take a leadership role in dealing with the problems that are the underlying causes of the anti-globalization movement.

Accepted Answer

A) True 
 B)False

Question 16

The World Bank estimates that approximately one-tenth of the world's population subsides on less than $2 per day.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following principles are not consistent with the behavioral standards advocated by the United Nations' Global Compact

Accepted Answer

A)   businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining.
B)   businesses should support a precautionary approach to environmental challenges.
C)   businesses should work against all forms of corruption, including bribery and extortion.
D)   businesses should comply with their legal duty to act in the best interests of their shareholders and maximize profitability.

Question 18

Responsive MNEs contribute to the development of the poorest nations by engaging in all of the following activities,except:

Accepted Answer

A)   creating jobs and wealth.
B)   focusing on maximizing profitability.
C)   catering underserved customers.
D)   investing in developing markets.

Question 19

MNEs have successfully insulated themselves from the accusations associated with entering regulatory environments that permit sweatshops by outsourcing manufacturing to arm's-length suppliers.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following characteristics are not typically associated with transactional MNEs

Accepted Answer

A)   they are generally sensitive not to promote socially or economically unsuitable products towards emerging market consumers.
B)   they tend to conform to labor laws and workplace regulations but avoid sweatshop-like conditions.
C)   they strive to employ non-exploitative attitudes towards the local communities in which they operate.
D)   they acknowledge the need to restrain their profit-maximizing behaviour when engaged in negotiations with indigenous suppliers.

Exam 8: The Future of the Transnational: An Evolving Global Role

Some transformative MNEs go beyond commercial relationships with their consumers and offer their products and services to those who most desperately need them,regardless of their ability to pay.

Progress in reducing global poverty has been observed to be more closely associated with investments by MNEs than it has with the foreign aid efforts of national governments and non-governmental organizations that have historically demonstrated a lack of business experience.

Which of the following are not characteristic of the attitudes of transactional MNEs in the context of their relationships with stakeholders

Which,if any,of the following business activities are likely to be acceptable to business ethicists:

In the 1970s,Nobel economist Milton Friedman advocated all of the following behaviours by MNEs,except:

Which of the following four adjectives are not typically used to describe the manner in which MNEs might respond to developing world needs:

The Global Compact is a legislated and enforceable code that provides a way for MNEs to have a more responsive and constructive role in the developing world.

Responsive MNEs act in a way that is sensitive and responsive to the needs of all its immediate stakeholders.

The relationship between transactional MNEs and non-governmental organizations (NGOs)is frequently characterized by confrontation and accusation.

MNEs that internationalize in developing countries have encountered all of the following differences pertaining to the labor force,except:

The primary difference between transactional MNEs and exploitative MNEs is that the former employs an approach that tends to be legally compliant and non-oppressive in its emerging market dealings.

A short-term challenge for MNEs is to determine whether they are willing to take a leadership role in dealing with the problems that are the underlying causes of the anti-globalization movement.

The World Bank estimates that approximately one-tenth of the world's population subsides on less than $2 per day.

Which of the following principles are not consistent with the behavioral standards advocated by the United Nations' Global Compact

Responsive MNEs contribute to the development of the poorest nations by engaging in all of the following activities,except:

MNEs have successfully insulated themselves from the accusations associated with entering regulatory environments that permit sweatshops by outsourcing manufacturing to arm's-length suppliers.

Which of the following characteristics are not typically associated with transactional MNEs