Exam 13: The Strategy of International Business

A global standardization strategy is appropriate when a firm is facing low pressures for cost reduction but high pressure for local responsiveness.

Support activities are always less important than the primary activities in achieving a competitive advantage.

According to Porter,the way to create superior value is to drive down the cost structure of the business and/or differentiate the product in some way so that consumers value it more.

As competition intensifies,global standardization strategies and transnational strategies tend to become less viable,and managers need to orientate their companies toward either an international strategy or a localization strategy.

Systematic increases in sales that have been observed to occur over the life of the product are referred to as the experience curve.

What are the four basic strategies that firms use to compete in international markets?

The value of a product to an average consumer is V; and the average price that the firm can charge a consumer for that product is P.Here,V - P can be termed as: C. The firm's profit per unit sold (π) is equal to P - C, while the consumer surplus per unit is equal to V - P.

Discuss the evolution of strategy.How does cost become important in the long term?

Economies of scale arise from all of the following sources,EXCEPT:

Learning effects tend to be more significant when a technologically simple task is repeated.

Which of the following is a disadvantage of the localization strategy?

_____ activities are basically concerned with creating the product,marketing and delivering the product to buyers,and providing support and after-sales service.

What is a core competence? Why is it essential to the success of the firm?

The customer is able to garner the benefit of the consumer surplus because one firm is competing with other firms for the customer's business,so the firm must charge a lower price than it could if it were a monopoly supplier.

The price a firm charges for a good or service is typically less than the value placed on that good or service by the customer.This is because:

For firms that are selling a product that serves universal needs,and that do not face significant competition,a(n)_____ strategy makes sense.

A firm that is pursuing a(n)_____ strategy is simultaneously trying to achieve low costs through location economies,economies of scale,and learning effects,and trying to differentiate its product offering across geographic markets.

Consider a transnational strategy.Why would a firm choose this strategic alternative? What are the disadvantages of this strategy?

Which of the following statements is NOT true?

Profit growth is measured by the percentage increase in net profits over time.