Answer: FALSE Diff: 2 Page Ref: 32 Skill: Concept Objective: 2-1 AACSB: Dynamics of the global economy 3 A firm's decision to internationalize is generally made as a reaction to the phen
Trang 1International Business: The New Realities, 2e (Cavusgil/Knight/Riesenberger)
Chapter 2 Globalization of Markets and the Internationalization of the Firm
1) The initial phase of globalization was triggered in part by the introduction of the railroad Answer: TRUE
Diff: 1 Page Ref: 31
Skill: Concept
Objective: 2-1
AACSB: Dynamics of the global economy
2) The Great Depression marked the beginning of the second phase of globalization
Answer: FALSE
Diff: 2 Page Ref: 32
Skill: Concept
Objective: 2-1
AACSB: Dynamics of the global economy
3) A firm's decision to internationalize is generally made as a reaction to the phenomenon of market globalization
Answer: FALSE
Diff: 1 Page Ref: 34
Skill: Concept
Objective: 2-2
AACSB: Dynamics of the global economy
4) Firms that pursue internationalization as a strategic move tend to approach global competition more aggressively than do firms that internationalize for reactive reasons
Answer: TRUE
Diff: 2 Page Ref: 34
Skill: Concept
Objective: 2-2
AACSB: Dynamics of the global economy
5) In advanced regional economic integration blocs such as the "common market," barriers are removed to the cross-border flow of factors of production
Trang 2AACSB: Dynamics of the global economy
7) One method used by global companies to drive down prices is product standardization Answer: TRUE
Diff: 1 Page Ref: 36
Skill: Concept
Objective: 2-3
AACSB: Dynamics of the global economy
8) One contribution of the World Trade Organization is to help maintain reduced trade barriers throughout the world
Answer: TRUE
Diff: 1 Page Ref: 37
Skill: Concept
Objective: 2-4
AACSB: Dynamics of the global economy
9) The end of the Cold War in 1989 hindered the forces of market liberalization in Eastern Europe
Answer: FALSE
Diff: 2 Page Ref: 37
Skill: Concept
Objective: 2-4
AACSB: Dynamics of the global economy
10) Industrialization implies that emerging market countries are increasing their dependence on low-cost labor
Answer: FALSE
Diff: 1 Page Ref: 37
Skill: Concept
Objective: 2-4
AACSB: Dynamics of the global economy
11) Technological advances have helped make internationalization affordable for all sizes of firms
Trang 312) China's consumer market is generally resistant to purchasing technologically advanced products
Answer: FALSE
Diff: 2 Page Ref: 41
Skill: Concept
Objective: 2-5
AACSB: Dynamics of the global economy; Use of information technology
13) The rate of speed at which nations integrate into the global economy is relatively consistent, regardless of income level
Answer: FALSE
Diff: 3 Page Ref: 44
Skill: Concept
Objective: 2-6
AACSB: Dynamics of the global economy
14) Globalization has led buyers to become more demanding and to shop for the best value worldwide
Answer: TRUE
Diff: 2 Page Ref: 52
Skill: Concept
Objective: 2-7
AACSB: Dynamics of the global economy
15) The first phase of globalization was characterized by which of the following?
A) the rise of steel production
B) the growth of railroads
C) the spread of electricity
D) the rise of SMEs
Answer: B
Diff: 1 Page Ref: 31-32
Skill: Concept
Objective: 2-1
AACSB: Dynamics of the global economy
16) The third phase of globalization was triggered by
A) the end of World War II
B) the invention of electricity
C) the end of World War I
D) economic growth in emerging markets
Trang 4AACSB: Dynamics of the global economy
18) Which of the following reflects the major contribution of GATT to globalization? A) strict controls on international currencies
B) worldwide economic downturn
C) reduction of barriers to international trade
D) advent of new communications technology
Answer: C
Diff: 2 Page Ref: 32
Skill: Concept
Objective: 2-1
AACSB: Dynamics of the global economy
19) The most recent phase of globalization is characterized by which of the following? A) rise of multinational companies from Japan
B) reduction of barriers to trade by Western industrialized countries
C) trade of commodities by trading companies
D) enormous growth of cross-border trade and investment
Answer: D
Diff: 2 Page Ref: 33
Skill: Concept
Objective: 2-1
AACSB: Dynamics of the global economy
20) Over time, the GATT evolved into which of the following?
A) World Bank
B) International Monetary Fund
C) World Trade Organization
Trang 521) In the third phase of globalization, multinational firms originated from all of the following except
AACSB: Dynamics of the global economy
22) Firms that are more successful at global competition display each of the following qualities except
A) identifying foreign market opportunities aggressively
B) approaching internationalization from a reactive standpoint
C) actively pursuing partnerships with foreign firms
D) focusing intensively on building organizational capacities
Answer: B
Diff: 3 Page Ref: 34
Skill: Concept
Objective: 2-2
AACSB: Dynamics of the global economy
23) Value-chain activities are defined as which of the following?
A) the methods through which governments promote economic integration
B) the aggregate activities of internationally active firms
C) the process of designing a product for a global market
D) the sequence of value-adding activities performed by a firm
Answer: D
Diff: 2 Page Ref: 35
Skill: Concept
Objective: 2-3
AACSB: Dynamics of the global economy
24) A regional economic integration bloc is characterized by all of the following except
A) the reduction of investment flows among members
B) the implementation of common business regulations
C) jointly harmonized fiscal and monetary policies
D) the reduction of trade barriers among members
Answer: A
Diff: 2 Page Ref: 36
Skill: Application
Objective: 2-3
Trang 6AACSB: Dynamics of the global economy
26) The free movement of capital around the world is known by which of the following terms? A) bond-based debt financing
B) regional economic integration
C) the globalization of capital
D) common market arrangements
Answer: C
Diff: 1 Page Ref: 36
Skill: Concept
Objective: 2-3
AACSB: Dynamics of the global economy
27) Global firms shift their manufacturing and procurement to foreign locations in order to
A) avoid the pressures of global competition
B) benefit from low labor costs
C) reduce the impact of regional recessions
D) avoid oversight by international agencies
Answer: B
Diff: 2 Page Ref: 36
Skill: Concept
Objective: 2-3
AACSB: Dynamics of the global economy
28) Which of the following is not a driver of market globalization?
Trang 729) Reduction in trade barriers is associated with the emergence of which of the following? A) Japan's transition to a command economy
B) regional economic integration blocs
C) member defection from the WTO
D) violation of GATT provisions
Answer: B
Diff: 2 Page Ref: 37
Skill: Concept
Objective: 2-4
AACSB: Dynamics of the global economy
30) The end of the Cold War was signaled by each of the following except
A) the collapse of the Soviet Union's economy
B) the tearing down of the Berlin Wall
C) free market reforms in China
D) China's move to join the WTO
Answer: D
Diff: 2 Page Ref: 37
Skill: Concept
Objective: 2-4
AACSB: Dynamics of the global economy
31) At the time of the Berlin Wall collapse, which of the following countries had not already embarked on a program of market-based reforms?
AACSB: Dynamics of the global economy
32) Which of the following countries has the lowest gross national income (GNI) per person? A) Norway
Trang 8AACSB: Dynamics of the global economy
34) is a financial network through which individuals can transfer money to individual recipients in other countries
A) International Monetary Fund
AACSB: Dynamics of the global economy
35) Technological leapfrogging is defined as which of the following?
A) combining analog and digital technologies in the same product
B) adopting new technology as soon as it is released
C) bypassing certain stages of technology when upgrading to new products
D) waiting to sell new technology until it has proven market success
Answer: C
Diff: 2 Page Ref: 40
Skill: Concept
Objective: 2-5
AACSB: Dynamics of the global economy; Use of information technology
36) Which of the following countries are considered to be the beachheads of technological advances?
A) Japan and China
B) Hungary and Poland
C) Brazil and Mexico
D) China and India
Trang 937) Technological advances have had their greatest impact in all of the following areas except
AACSB: Dynamics of the global economy; Use of information technology
38) Which of the following is the most transformative technology for developing economies? A) cell phone
AACSB: Dynamics of the global economy; Use of information technology
39) Which of the following has the fastest growth rate of cellular phone subscribers in the world? A) Europe
AACSB: Dynamics of the global economy; Use of information technology
40) The ability of a nation to govern its own affairs is known as
Trang 10AACSB: Dynamics of the global economy
42) Each of the following represents a firm-level consequence of market globalization except
A) firms must proactively internationalize to reduce potential threats
B) firms must deal with new business risks
C) an international focus is viable only in certain industries
D) firms must manage intense rivalry from foreign competitors
Answer: C
Diff: 2 Page Ref: 52
Skill: Application
Objective: 2-7
AACSB: Dynamics of the global economy
43) Highly advanced internationalizing firms seek a simultaneous presence in which of the following trading regions?
A) North America, Europe, and Asia
B) North America, Africa, and Central America
C) Eastern Europe, Australia, and North America
D) Asia, Europe, and South America
Answer: A
Diff: 1 Page Ref: 52
Skill: Concept
Objective: 2-7
AACSB: Dynamics of the global economy
44) The most direct firm-level consequence of market globalization affects which of the
following?
A) the firm's global sourcing contracts
B) the offshoring potential of particular activities
C) research and development costs faced by the firm
D) the firm's entire value chain
Trang 1145) Which stage comes before procurement in a firm's value chain?
A) research & development
AACSB: Dynamics of the global economy
46) Which of the following represents the final stage in a firm's value chain?
A) marketing
B) procurement (sourcing)
C) research & development
D) distribution & after-sales service
Answer: D
Diff: 1 Page Ref: 53
Skill: Concept
Objective: 2-7
AACSB: Dynamics of the global economy
Internationalization Conference (Scenario)
At a conference on business internationalization strategies, representatives of three different businesses meet to discuss a joint venture between their companies Business A is located in a country that internationalized during the second phase of globalization Business B is based in a country that internationalized during the third phase of globalization Business C is located in an emerging market country
47) The representative from Business A is most likely from which of the following countries? A) China
Trang 12AACSB: Dynamics of the global economy
49) The representative from Business C is most likely from which of the following countries? A) Italy
AACSB: Dynamics of the global economy
Global Operations Report (Scenario)
As Vice President of Global Expansion for Pax Telecom, Deva Mikiri is tasked with preparing a comprehensive report on the company's global operations over the past twenty years Deva assigns three strategists to collaborate on the History portion of the report, which details the rationale behind Pax's decisions to expand operations in particular areas Rashid Ahl focuses on early expansion to China, which occurred after China began to make its market more accessible
to foreign companies Markus Teller focuses on Pax's expansion to Eastern Europe, which was motivated by increased industry privatization in key countries Lavonne Jackson focuses on expansion to Japan, which happened when the company's commercial bank expanded its service network to Asia
50) Which of the following drivers of market globalization does Markus most likely cite as responsible for the company's expansion to Eastern Europe?
Trang 1351) In describing the main driver behind Pax's expansion to China, Rashid most likely
emphasizes
A) economic development
B) advances in technology
C) reduction of barriers to trade
D) integration of world financial markets
Answer: C
Diff: 2 Page Ref: 37
Skill: Application
Objective: 2-4
AACSB: Analytic skills
52) Lavonne's research most likely recognizes which of the following drivers of market
globalization as responsible for the company's expansion to Japan?
A) integration of world financial markets
B) modernization
C) adoption of free markets
D) reduction of barriers to investment
Answer: A
Diff: 2 Page Ref: 37
Skill: Application
Objective: 2-4
AACSB: Analytic skills
Globalization Debate (Scenario)
In his international business class, Professor Jang organizes a debate on the societal effects of market globalization Juan Prince takes a position that highlights the negative effects of market globalization He emphasizes how multinational enterprises can wield so much influence that they threaten national sovereignty He also notes the prevalence of low wages and sweatshop conditions as firms utilize low-cost labor abroad Juan then describes the detrimental effects of corporate pollution on the environment, and he ends his argument by explaining how market globalization helps homogenize national cultures Rina Taylor is assigned to counter Juan's position
53) Which of the following does Rina most likely cite as a counter example to Juan's argument regarding the influence of MNEs on national sovereignty?
A) passage of the Sarbanes-Oxley Act of 2002
B) technological advances in computer-aided design of products
C) the political influence of large firms such as Walmart
D) the actual GDPs of Israel, Greece, and Poland
Answer: A
Diff: 3 Page Ref: 46
Skill: Critical Thinking
Objective: 2-6
AACSB: Dynamics of the global economy; Reflective thinking skills
Trang 1414
54) Which of the following most likely supports Rina's argument over Juan's concerning wages and working conditions in developing countries?
A) Most African countries today still suffer from low or negative GDP growth
B) Vietnam has experienced a five-fold increase in wages as a result of the growth of the
footwear industry there
C) The move of Electrolux to Mexico cost Michigan 2,700 jobs
D) Minimum wages should be established at set levels, regardless of the impact on the number of jobs
Answer: B
Diff: 3 Page Ref: 47
Skill: Critical Thinking
Objective: 2-6
AACSB: Dynamics of the global economy; Reflective thinking skills
55) Rina most likely counters Juan's claim regarding environmental effects by pointing out which of the following?
A) Land preservation is more important than pollution reduction for preserving the environment B) China's landscape was permanently altered by the construction of the Three Gorges Dam C) Environmental destruction tends to diminish in the long run, as economies develop
D) Attempts at foreign cultural imperialism are often blocked by national governments
Answer: C
Diff: 3 Page Ref: 50
Skill: Critical Thinking
Objective: 2-6
AACSB: Dynamics of the global economy; Reflective thinking skills
56) Which of the following most likely supports Rina's argument over Juan's concerning the homogenization of national cultures?
A) The standardizing forces of globalization are often resisted through increasing nationalism B) Foreign values tend to shift not just superficial aspects of culture, but deeply held beliefs as well
C) Material goods such as cell phones and computers are found in most homes throughout the world
D) In most industries, domestic operation alone cannot sustain competitive business growth Answer: A
Diff: 3 Page Ref: 51
Skill: Critical Thinking
Objective: 2-6
AACSB: Dynamics of the global economy; Reflective thinking skills