download test bank for international business the new realities 2nd edition by cavusgil knight and riesenberger

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.. A

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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

Skill: Concept

Objective: 2-1

3) A firm's decision to internationalize is generally made as a reaction to the phenomenon

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

Skill: Concept

Objective: 2-2

5) In advanced regional economic integration blocs such as the "common market," barriers are removed to the cross-border flow of factors of production

Answer: TRUE

Skill: Concept

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Objective: 2-3

6) Converging lifestyles and preferences worldwide help to promote traditional values

7) One method used by global companies to drive down prices is product

standardization Answer: TRUE

Skill: Concept

Objective: 2-3

8) One contribution of the World Trade Organization is to help maintain reduced trade

barriers throughout the world Answer: TRUE

Skill: Concept

Objective: 2-4

9) The end of the Cold War in 1989 hindered the forces of market liberalization in

10) Industrialization implies that emerging market countries are increasing their dependence

on low-cost labor

Answer: FALSE

Skill: Concept

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Objective: 2-4

11) Technological advances have helped make internationalization affordable for all sizes

AACSB: Dynamics of the global economy; Use of information technology

12) China's consumer market is generally resistant to purchasing technologically

13) The rate of speed at which nations integrate into the global economy is relatively

consistent, regardless of income level

Answer: FALSE

Skill: Concept

Objective: 2-6

14) Globalization has led buyers to become more demanding and to shop for the best

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

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D) the rise of SMEs

Answer: B

Diff: 1 Page Ref: 31-32

Skill: Concept

Objective: 2-1

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 Answer: A

Skill: Concept

Objective: 2-1

17) Multinational firms first emerged in which phase of

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

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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

Skill: Concept

Objective: 2-1

20) Over time, the GATT evolved into which of the following?

A) World Bank

B) International Monetary Fund

C) World Trade Organization

21) In the third phase of globalization, multinational firms originated from all of the following except

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

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C) actively pursuing partnerships with foreign firms

D) focusing intensively on building organizational

capacities Answer: B

Skill: Concept

Objective: 2-2

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

Skill: Concept

Objective: 2-3

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

Skill: Application

Objective: 2-3

25) All of the following represent examples of regional economic integration blocs except

A) World Trade Organization

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Skill: Application

Objective: 2-3

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

Skill: Concept

Objective: 2-3

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

Skill: Concept

Objective: 2-3

28) Which of the following is not a driver of market globalization?

29) Reduction in trade barriers is associated with the emergence of which of the following?

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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

Skill: Concept

Objective: 2-4

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

Skill: Concept

Objective: 2-4

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?

32) Which of the following countries has the lowest gross national income (GNI) per

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Diff: 1 Page Ref: 38-39

Skill: Concept

Objective: 2-4

33) Which of the following drivers of market globalization enables firms to engage in foreign currency transactions?

34) is a financial network through which individuals can transfer money

to individual recipients in other countries A) International Monetary Fund

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

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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 Answer:

D

Skill: Concept

Objective: 2-5

37) Technological advances have had their greatest impact in all of the following

areas except A) manufacturing

38) Which of the following is the most transformative technology for developing economies? A) cell phone

39) Which of the following has the fastest growth rate of cellular phone subscribers in the world? A) Europe

B) North America

C) Africa

D) Asia

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Answer: C

Skill: Concept

Objective: 2-5

40) The ability of a nation to govern its own affairs is known as

41) Which of the following terms refers to the relocation of manufacturing and other value-chain activities to cost-effective locations abroad?

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

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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

Skill: Concept

Objective: 2-7

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

Answer: D

Skill: Concept

Objective: 2-7

45) Which stage comes before procurement in a firm's value chain?

A) research & development

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

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Answer: D

Skill: Concept

Objective: 2-7

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

48) The representative from Business B is most likely from which of the following

49) The representative from Business C is most likely from which of the following countries? A) Italy

B) Brazil

C) United States

D) France

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Answer: B

Skill: Application

Objective: 2-1

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?

AACSB: Analytic skills

51) 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

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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

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

Skill: Critical Thinking

Objective: 2-6

AACSB: Dynamics of the global economy; Reflective thinking skills

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

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