Question 1
Opponents of globalization claim that free flow of investments and trade encourages exploitation of developing countries that lack the regulations to protect their environment (e.g., natural resources) and labor.
a) True
x b) False
Question 2
Two of three factors that seem to underlie the trend toward globalization is change in communication and information. The third factor is:
a) The fall of Communism in Europe.
b) Rising trade barriers.
c) Uneven manufacturing and service costs around the globe.
d) Fewer international frictions.
e) The influence of the United Nations, IMF, and World Bank.
Question 3
Global companies:
a) Are the most common form of international business.
b) Have no regional or national ties.
c) Are regulated by the International Regulatory Agency.
d) Pay no taxes.
e) employ only local labor force
Question 4
One of the most influential political forces in the contemporary global political environment appears to be:
a) Apathy
b) Small national voter turnout.
c) Corruption.
d) Bureaucratic "red-tape".
e) The rise of religious fundamentalism and terrorism.
Question 5
Understanding of national cultures is important for global managers since it:
a) Prevents them from losing their own culture.
b) Improves their relationship with the headquarters of the home country.
c) Eliminates the impact of the cultural shock.
d) Improves their business effectiveness, efficiency, and allows for prevention of commit-ting costly mistakes.
e) Is fashionable.
Question 6
Political systems include all of the following except:
a) Type of the government and political parties.
b) Existence of free elections.
c) Freedom of the media.
d) Arts and crafts.
e) Stage of country's evolution from a nation into a state.
Question 7
The common law is based on:
a) Religion.
b) Tradition, precedent, and custom.
c) Deduction and rational conclusion.
d) Tribal rituals
e) Loose interpretation.
Question 8
The following are all components of culture except:
a) Shared actions, values, and beliefs.
b) Communication.
c) Religion.
d) Geographic location.
Question 9
The protection of intellectual property is universally practiced and enforced.
a) True
b) False
Question 10
Some elements of geography that the global CEO should analyze include all of the following except:
a) Location.
b) Climate.
c) Infrastructure.
d) Topography.
Question 11
Which of the following is not a source of renewable energy:
a) Solar.
b) Biomass.
c) Fossil fuel.
d) Hydroelectric.
Question 12
Examples of environmental degradation are:
a) Ozone depletion
b) Over grazing
c) Global warming
d) Soil erosion
e) All of the above
f) None of the above
Question 13
Which of the following trade theories identifies specialization as a reason for global business?
a) Imperfect Market Theory
b) Product Life Cycle
c) Comparative Advantage
d) Leon tiff-Paradox
e) None of the above
Question 14
Licensing is not a process by which a firm provides technology (copyrights, patents, trademarks) in exchange for fees or other specialized benefits:
a) True
b) False
Question 15
Like the IMF, the ____ comprises a number of countries as members; however, unlike the IMF, it uses private rather than government sector resources to achieve its objectives:
a) The World Bank
b) The International Finance Corporation
c) The World Trade Organization
d) The United Nations
e) The Multilateral Investment Guarantee Agency (MIGA)
Question 16
For Hechsher/Ohlin, the most important cause of the differences in relative commodity prices and trade between nations is a difference in:
a) Factor endowments
b) Technology
c) Consumer tastes and preferences
d) Demand conditions
e) Population growth
Question 17
The Theory of Absolute Advantage was espoused by:
a) David Ricardo
x b) Adam Smith
c) Bertil Ohlin
d) Eli Hecksher
e) Paul Samuelson
Question 18
An organization that sells its product in 100 countries is automatically more global than an organization that sells its product in 20 countries:
a) True
b) False
Question 19
_______ is a tendency to consider that one's home country is superior to other countries in all dimensions, and may engender inadequate management decisions in the global market:
a) Ethnocentrism
b) Geocentrism
c) Polycentrism
d) All of the above
e) None of the above
Question 20
Which of the following is not a characteristic of a truly global organization:
a) Gives each of its foreign subsidiaries complete decision-making power
b) Hires employees and executives from different parts of the world
c) Takes advantage of global opportunities whenever possible
d) All of the above
e) None of the above
Question 21
When developing a business in a foreign market where it has had no presence or experience, an organization should usually invest massively in order to gain rapidly a critical size, rather than test the market progressively.
a) True
b) False
Question 22
A global strategic planning process should take advantage of foreign business opportunities as they arise, rather than constraining the organization's development by determining in advance which countries the organization should develop into.
a) True
b) False
Question 23
Technology transfer always has positive effects on the receiving country:
a) True
x b) False
Question 24
The global CEO should be familiar with the location, demographics, topography, and climate of the markets in which he/she operates:
x a) True
b) False
Question 25
To develop your business in a country that is politically unstable and with only moderate sales potential, _______ would likely be the most appropriate mode of entry:
x a) Exporting
b) Purchasing a local company
c) Building a new company with local management and production