Question 1

What are the benefits and costs of foreign direct investment from the host country's perspective? Explain.

Accepted Answer

Foreign direct investment (FDI) can brin

Question 2

The second stage of the product life cycle is _____.

Accepted Answer

A)  decline 
B)  introduction 
C)  growth 
D)  maturity 
E)  development 
A)  decline 
B)  introduction 
C)  growth 
D)  maturity 
E)  development

Question 3

A firm that has a patent for manufacturing a particular brand-name drug will have monopoly rights to use that brand name abroad to produce goods profitably. This is an example of a(n)_____ advantage.

Accepted Answer

A)  ownership, or firm specific 
B)  locational, or country-specific 
C)  internalization 
D)  externalized 
E)  environmental 
A)  ownership, or firm specific 
B)  locational, or country-specific 
C)  internalization 
D)  externalized 
E)  environmental

Question 4

According to the text, which of the following entry strategies has the lowest degree of risk?

Accepted Answer

A)  Licensing 
B)  Wholly-owned foreign subsidiary 
C)  Foreign acquisition 
D)  Joint venture 
E)  Strategic alliance 
A)  Licensing 
B)  Wholly-owned foreign subsidiary 
C)  Foreign acquisition 
D)  Joint venture 
E)  Strategic alliance

Question 5

Of the following, which is NOT a cost of foreign direct investment?

Accepted Answer

A)  Developing countries may be exploited by MNEs. 
B)  Human rights firms may exploit the labor force in host countries. 
C)  Local governments in host countries may lack corporate social responsibilities on the part of MNEs. 
D)  Host countries have been concerned about political interference by MNEs in their country's affairs when things do not go the way the foreign company wants. 
E)  It led to a lapse in job creation and economic flow in the United States. 
A)  Developing countries may be exploited by MNEs. 
B)  Human rights firms may exploit the labor force in host countries. 
C)  Local governments in host countries may lack corporate social responsibilities on the part of MNEs. 
D)  Host countries have been concerned about political interference by MNEs in their country's affairs when things do not go the way the foreign company wants. 
E)  It led to a lapse in job creation and economic flow in the United States.

Question 6

_______ refers to the practice in which the parent firm is obligated to provide specialized equipment and/or service, and sometimes funding some startup costs to host-country firm in return for an annual fee.

Accepted Answer

The answer of _______ refers to the practice in which...

Question 7

An agreement between two or more firms that do not involve the creation of a separate entity with joint ownership and in which the firms stand to gain revenues and maximize profits through cooperation for a given period of time refers to _______.

Accepted Answer

The answer of An agreement between two or more firms...

Question 8

Scenario - Lewis Fabrication
Lewis Fabrication was founded in 2001 and is based in Maryland, USA. This company manufactures custom designed motorcycle parts and currently has over two thousand U.S. customers. Due to the growing number of inquiries received from foreign countries such as Japan, Canada, China, and Indonesia, Lewis Fabrication has decided to begin operations on a global scale. The owners realize there is much to learn before undertaking this monumental step. However, financial projections indicate about $1 million in profit is very likely in the first year of going global. The owners are very excited and looking forward to the business expansion.
-In its quest for global expansion Lewis Fabrication must examine its rationales for wanting to expand into the foreign marketplace. Which one of the following is not a reason why this company would want to expand globally?

Accepted Answer

A)  To maximize shareholder wealth 
B)  To minimize risk of failure for the business 
C)  To increase the revenues of the company 
D)  To cut costs of production for the company 
E)  To reduce risks associated with business cycle fluctuations 
A)  To maximize shareholder wealth 
B)  To minimize risk of failure for the business 
C)  To increase the revenues of the company 
D)  To cut costs of production for the company 
E)  To reduce risks associated with business cycle fluctuations

Question 9

When did the growth of MNEs accelerate?

Accepted Answer

A)  After the Revolutionary War 
B)  After the Civil War 
C)  After WW I 
D)  After WW II 
E)  After the Vietnam War 
A)  After the Revolutionary War 
B)  After the Civil War 
C)  After WW I 
D)  After WW II 
E)  After the Vietnam War

Question 10

Chaebols, the South Korean conglomerates discussed in the textbook, are examples of socially responsible and transparent companies.

Accepted Answer

A) True 
 B)False

Question 11

The so-called BRIC countries consist of: _____.

Accepted Answer

A)  Brazil, Russia, India, and China 
B)  Belgium, Russia, Iran, and Canada 
C)  Britain, Russia, Iraq, and Cuba 
D)  Brazil, Russia, Iraq, and Canada 
E)  Britain, Russia, India, and Cuba 
A)  Brazil, Russia, India, and China 
B)  Belgium, Russia, Iran, and Canada 
C)  Britain, Russia, Iraq, and Cuba 
D)  Brazil, Russia, Iraq, and Canada 
E)  Britain, Russia, India, and Cuba

Question 12

Boseman Clothier, Inc. has been in operation for over 75 years. It is based in South Carolina, USA and is a well-recognized name in the industry. It produces custom fitted men's suits that are in high demand throughout the world. The average cost of one of its suits is in excess of five thousand U.S. dollars. Boseman proudly states it has more customer orders than its one store can fill within the next six months. With growing demand from overseas, the company has recently decided to open operations in four foreign markets next year.
Boseman realizes the potential of this move will generate increased revenues for the company. One of the options it is contemplating is exploring forming an international joint venture. Boseman is also entertaining the thought of opening operations differently in each of the four new foreign markets. The company feels the use of different strategies may increase its odds of generating profits in each different market.
-Bozeman is also considering making the entry into the international market by engaging in foreign direct investments in the nations. Which one of the following is not a true statement regarding foreign direct investment from the host country's perspective?

Accepted Answer

A)  Significant financial inflows always result from engaging in foreign direct investment. 
B)  Foreign direct investment can create new jobs and can generate tax revenues for governments 
C)  A concern of the local governments in host countries is the lack of corporate social responsibility 
D)  There is the potential for exploitation of human labor within certain countries 
E)  These investments may take the form of plants, buildings, or inventories 
A)  Significant financial inflows always result from engaging in foreign direct investment. 
B)  Foreign direct investment can create new jobs and can generate tax revenues for governments 
C)  A concern of the local governments in host countries is the lack of corporate social responsibility 
D)  There is the potential for exploitation of human labor within certain countries 
E)  These investments may take the form of plants, buildings, or inventories

Question 13

Coca-Cola has built 41 bottling plants and two concentrate manufacturing plants with three separate partners in China since 1979. This is an example of a(n)_____.

Accepted Answer

A)  license 
B)  franchise 
C)  foreign acquisition 
D)  strategic alliance 
E)  international joint venture 
A)  license 
B)  franchise 
C)  foreign acquisition 
D)  strategic alliance 
E)  international joint venture

What are the benefits and costs of foreign direct investment from the host country's perspective? Explain.

The second stage of the product life cycle is _____.

A firm that has a patent for manufacturing a particular brand-name drug will have monopoly rights to use that brand name abroad to produce goods profitably. This is an example of a(n)_____ advantage.

According to the text, which of the following entry strategies has the lowest degree of risk?

Of the following, which is NOT a cost of foreign direct investment?

_______ refers to the practice in which the parent firm is obligated to provide specialized equipment and/or service, and sometimes funding some startup costs to host-country firm in return for an annual fee.

An agreement between two or more firms that do not involve the creation of a separate entity with joint ownership and in which the firms stand to gain revenues and maximize profits through cooperation for a given period of time refers to _______.

When did the growth of MNEs accelerate?

Chaebols, the South Korean conglomerates discussed in the textbook, are examples of socially responsible and transparent companies.

The so-called BRIC countries consist of: _____.

Coca-Cola has built 41 bottling plants and two concentrate manufacturing plants with three separate partners in China since 1979. This is an example of a(n)_____.

The Rise of Globalization

The Evolution of International Business

Regional Economic Integration

The International Flow of Funds and Exchange Rates

The Cultural Environment

The Legal and Political Environment of Global Business

Corruption and Ethics in Global Business

Control of Global Business

The Organization of Global Business

Global Human Resource Management

Global Marketing

Global Operations and Supply-Chain Management

Global Financial Management

Accounting and Taxation in Global Business

Filters

Exam 8: Entry Strategies in Global Business

What are the benefits and costs of foreign direct investment from the host country's perspective? Explain.

The second stage of the product life cycle is _____.

A firm that has a patent for manufacturing a particular brand-name drug will have monopoly rights to use that brand name abroad to produce goods profitably. This is an example of a(n)_____ advantage.

According to the text, which of the following entry strategies has the lowest degree of risk?

Of the following, which is NOT a cost of foreign direct investment?

_______ refers to the practice in which the parent firm is obligated to provide specialized equipment and/or service, and sometimes funding some startup costs to host-country firm in return for an annual fee.

An agreement between two or more firms that do not involve the creation of a separate entity with joint ownership and in which the firms stand to gain revenues and maximize profits through cooperation for a given period of time refers to _______.

When did the growth of MNEs accelerate?

Chaebols, the South Korean conglomerates discussed in the textbook, are examples of socially responsible and transparent companies.

The so-called BRIC countries consist of: _____.

Coca-Cola has built 41 bottling plants and two concentrate manufacturing plants with three separate partners in China since 1979. This is an example of a(n)_____.

The Rise of Globalization

The Evolution of International Business

Regional Economic Integration

The International Flow of Funds and Exchange Rates

The Cultural Environment

The Legal and Political Environment of Global Business

Corruption and Ethics in Global Business

Control of Global Business

The Organization of Global Business

Global Human Resource Management

Global Marketing

Global Operations and Supply-Chain Management

Global Financial Management

Accounting and Taxation in Global Business

Filters