Question 1

Which of the following is characteristic of emerging markets?

Accepted Answer

A)  low inward foreign direct investment 
B)  minimum regulations 
C)  major focus on services and branded products 
D)  rapidly declining trade barriers 
A)  low inward foreign direct investment 
B)  minimum regulations 
C)  major focus on services and branded products 
D)  rapidly declining trade barriers

Question 2

New global challengers are leading firms from emerging markets that are fast becoming key contenders in world markets.

Accepted Answer

A) True 
 B)False

Question 3

Outsourcing helps firms become more efficient, concentrate on their core competencies, and obtain competitive advantages.

Accepted Answer

A) True 
 B)False

Question 4

MNEs must set prices appropriate for local conditions. Many firms devise innovative products and packaging to keep prices low.

Accepted Answer

A) True 
 B)False

Question 5

Why is per-capita income NOT always the best indicator of an emerging market's potential? What does the concept of purchasing power parity (PPP) suggest?

Accepted Answer

When evaluating the potential of individ

Question 6

Which of the following countries is home to the Hyundai Group?

Accepted Answer

A)  India 
B)  South Korea 
C)  Russia 
D)  Taiwan 
A)  India 
B)  South Korea 
C)  Russia 
D)  Taiwan

Question 7

Per-capita GDP converted at market exchange rates paints an inaccurate picture of market potential because it overlooks the substantial price differences between advanced economies and emerging markets.

Accepted Answer

A) True 
 B)False

Question 8

Purchasing power parity is ________.

Accepted Answer

A)  the total income received by all sectors of an economy within a nation 
B)  the value of goods and services that can be purchased with one unit of a country's currency 
C)  an adjustment for prices that reflects the amount of goods that consumers can buy in their home country, using their own currency and consistent with their own standard of living 
D)  the exchange rate in the international currency market 
A)  the total income received by all sectors of an economy within a nation 
B)  the value of goods and services that can be purchased with one unit of a country's currency 
C)  an adjustment for prices that reflects the amount of goods that consumers can buy in their home country, using their own currency and consistent with their own standard of living 
D)  the exchange rate in the international currency market

Question 9

Economic Development Workshop (Scenario)
Members of 50 different countries attended a workshop on economic development hosted by an international organization based in Geneva, Switzerland. Attendees of the workshop learned about techniques designed to assist countries in expanding their degree of economic development.
-The workshop participants are divided into groups of three. For learning purposes, each group must be made up of individuals from countries with a similar degree of economic development. Which of the following might be grouped together?

Accepted Answer

A)  Representatives from Bangladesh, Nicaragua, and Zaire 
B)  Representatives from Germany, China, and Sudan 
C)  Representatives from the U.S., China, and Belarus 
D)  Representatives from Sudan, Spain, and France 
A)  Representatives from Bangladesh, Nicaragua, and Zaire 
B)  Representatives from Germany, China, and Sudan 
C)  Representatives from the U.S., China, and Belarus 
D)  Representatives from Sudan, Spain, and France

Question 10

Which of the following situations will discourage business activities of foreign firms in an emerging market?

Accepted Answer

A)  allowing foreign firms to access the country's energy resources 
B)  increasing the requirements for licenses, approvals, and paperwork 
C)  using a strong legal framework and patent laws 
D)  investing in a strong Internet infrastructure 
A)  allowing foreign firms to access the country's energy resources 
B)  increasing the requirements for licenses, approvals, and paperwork 
C)  using a strong legal framework and patent laws 
D)  investing in a strong Internet infrastructure

Question 11

Maximus Motor Company (Scenario)
Maximus Motor Company is a British automobile manufacturer that builds high-end luxury cars for sale around the world. Maximus managers recognize they are missing opportunities in emerging markets, such as India, which have an increasing number of middle-class people ready to purchase affordable cars. Competitors that entered the Indian market experienced significant profits over the last two years. Maximus managers have been assigned the task of determining the best strategy for Maximus to do business in India.
-Which of the following is likely to be the most beneficial to Maximus if it builds a manufacturing facility in India?

Accepted Answer

A)  legal precedents 
B)  low-cost labor pool 
C)  government regulations 
D)  solid infrastructure 
A)  legal precedents 
B)  low-cost labor pool 
C)  government regulations 
D)  solid infrastructure

Question 12

Which of the following is characteristic of emerging markets?

Accepted Answer

A)  minimal trade barriers 
B)  high trade volume 
C)  low inward FDI 
D)  highly developed industry 
A)  minimal trade barriers 
B)  high trade volume 
C)  low inward FDI 
D)  highly developed industry

Question 13

Adjusted per-capita GDP does not represent the number of products consumers can buy in a given country.

Accepted Answer

A) True 
 B)False

Question 14

Emerging markets are important in international business and trade due to ________.

Accepted Answer

A)  a large informal economy 
B)  low rates of energy consumption 
C)  a high growth rate of middle class population 
D)  low inward FDI 
A)  a large informal economy 
B)  low rates of energy consumption 
C)  a high growth rate of middle class population 
D)  low inward FDI

Question 15

Vytel Communications (Scenario)
Vytel Communications is a U.S.-based telecommunications company that is considering doing business in Argentina. Vytel managers hire a consulting firm to investigate the risks and benefits related to doing business in Argentina. The consulting firm identifies a number of challenges that might prohibit Vytel from entering Argentina. In addition, the consultants conduct surveys that indicate a demand for Vytel's products and services.
-Which of the following most likely supports the consulting firm's recommendation that Vytel should NOT do business in Argentina?

Accepted Answer

A)  Government bureaucracy in Argentina is limited and is not characterized by red tape. 
B)  Qualified suppliers and distributors who are eager to work are readily available in Argentina. 
C)  Import restrictions do not apply to the telecommunications industry in Argentina. 
D)  In the past, intellectual property rights law have not been enforced in Argentina. 
A)  Government bureaucracy in Argentina is limited and is not characterized by red tape. 
B)  Qualified suppliers and distributors who are eager to work are readily available in Argentina. 
C)  Import restrictions do not apply to the telecommunications industry in Argentina. 
D)  In the past, intellectual property rights law have not been enforced in Argentina.

Question 16

Maximus Motor Company (Scenario)
Maximus Motor Company is a British automobile manufacturer that builds high-end luxury cars for sale around the world. Maximus managers recognize they are missing opportunities in emerging markets, such as India, which have an increasing number of middle-class people ready to purchase affordable cars. Competitors that entered the Indian market experienced significant profits over the last two years. Maximus managers have been assigned the task of determining the best strategy for Maximus to do business in India.
-Which of the following would be most important for Maximus managers in determining the best entry strategy for entering an emerging market such as India, characterized by the presence of family conglomerates?

Accepted Answer

A)  What other firms have partnered with family conglomerates? 
B)  How often do Indians use their cars and for what purpose? 
C)  What type of automobile should Maximus manufacture in India? 
D)  How would Maximus benefit from partnering with a family conglomerate? 
A)  What other firms have partnered with family conglomerates? 
B)  How often do Indians use their cars and for what purpose? 
C)  What type of automobile should Maximus manufacture in India? 
D)  How would Maximus benefit from partnering with a family conglomerate?

Question 17

When sourcing relies on foreign suppliers or production bases, it is known as ________.

Accepted Answer

A)  offshoring 
B)  protectionism 
C)  insourcing 
D)  subsidizing 
A)  offshoring 
B)  protectionism 
C)  insourcing 
D)  subsidizing

Question 18

Excessive bureaucracy is usually associated with ________.

Accepted Answer

A)  a strong legal framework 
B)  low country risk 
C)  lack of transparency 
D)  low trade barriers 
A)  a strong legal framework 
B)  low country risk 
C)  lack of transparency 
D)  low trade barriers

Question 19

In the early stages of market research, managers examine three important statistics to estimate market potential: per-capita income, size of the middle class, and market potential indicators.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is typical of developing economies?

Accepted Answer

A)  low levels of bureaucracy and red tape 
B)  low debt levels 
C)  lack of cultural history 
D)  poor education systems 
A)  low levels of bureaucracy and red tape 
B)  low debt levels 
C)  lack of cultural history 
D)  poor education systems

Which of the following is characteristic of emerging markets?

New global challengers are leading firms from emerging markets that are fast becoming key contenders in world markets.

Outsourcing helps firms become more efficient, concentrate on their core competencies, and obtain competitive advantages.

MNEs must set prices appropriate for local conditions. Many firms devise innovative products and packaging to keep prices low.

Why is per-capita income NOT always the best indicator of an emerging market's potential? What does the concept of purchasing power parity (PPP) suggest?

Which of the following countries is home to the Hyundai Group?

Per-capita GDP converted at market exchange rates paints an inaccurate picture of market potential because it overlooks the substantial price differences between advanced economies and emerging markets.

Purchasing power parity is ________.

Which of the following situations will discourage business activities of foreign firms in an emerging market?

Which of the following is characteristic of emerging markets?

Adjusted per-capita GDP does not represent the number of products consumers can buy in a given country.

Emerging markets are important in international business and trade due to ________.

When sourcing relies on foreign suppliers or production bases, it is known as ________.

Excessive bureaucracy is usually associated with ________.

In the early stages of market research, managers examine three important statistics to estimate market potential: per-capita income, size of the middle class, and market potential indicators.

Which of the following is typical of developing economies?

Introduction: What Is International Business

Globalization of Markets and the Internationalization of the Firm

The Cultural Environment of International Business

Ethics, Corporate Social Responsibility, Sustainability and Corporate Governance in International Business

Theories of International Trade and Investment

Political and Legal Systems in National Environments

Government Intervention and Regional Economic Integration

The International Monetary and Financial Environment

Financial Management and Accounting in the Global Firm

Strategy and Organization in the International Firm

Global Market Opportunity Assessment

Exporting and Global Sourcing

Foreign Direct Investment and Collaborative Ventures

Licensing, Franchising, and Other Contractual Strategies

Marketing in the Global Firm

Human Resource Management in the Global Firm

Filters

Exam 8: Understanding Emerging Markets

Which of the following is characteristic of emerging markets?

New global challengers are leading firms from emerging markets that are fast becoming key contenders in world markets.

Outsourcing helps firms become more efficient, concentrate on their core competencies, and obtain competitive advantages.

MNEs must set prices appropriate for local conditions. Many firms devise innovative products and packaging to keep prices low.

Why is per-capita income NOT always the best indicator of an emerging market's potential? What does the concept of purchasing power parity (PPP) suggest?

Which of the following countries is home to the Hyundai Group?

Per-capita GDP converted at market exchange rates paints an inaccurate picture of market potential because it overlooks the substantial price differences between advanced economies and emerging markets.

Purchasing power parity is ________.

Which of the following situations will discourage business activities of foreign firms in an emerging market?

Which of the following is characteristic of emerging markets?

Adjusted per-capita GDP does not represent the number of products consumers can buy in a given country.

Emerging markets are important in international business and trade due to ________.

When sourcing relies on foreign suppliers or production bases, it is known as ________.

Excessive bureaucracy is usually associated with ________.

In the early stages of market research, managers examine three important statistics to estimate market potential: per-capita income, size of the middle class, and market potential indicators.

Which of the following is typical of developing economies?

Introduction: What Is International Business

Globalization of Markets and the Internationalization of the Firm

The Cultural Environment of International Business

Ethics, Corporate Social Responsibility, Sustainability and Corporate Governance in International Business

Theories of International Trade and Investment

Political and Legal Systems in National Environments

Government Intervention and Regional Economic Integration

The International Monetary and Financial Environment

Financial Management and Accounting in the Global Firm

Strategy and Organization in the International Firm

Global Market Opportunity Assessment

Exporting and Global Sourcing

Foreign Direct Investment and Collaborative Ventures

Licensing, Franchising, and Other Contractual Strategies

Marketing in the Global Firm

Human Resource Management in the Global Firm

Filters