Question 1

In France, fine dressmaking and tailoring have been a tradition predating Queen Marie Antoinette.Cloth manufacturers, design schools, craft apprenticeship programs, modeling agencies, and so forth, all exist to supply the clothing industry.This is an example of the __________ in Porter's model.

Accepted Answer

A)   firm strategy, structure, and rivalry
B)   related and supporting industries
C)   demand conditions
D)   factors of production B

Question 2

What are some incentives for firms to use international strategies? What are the three basic benefits firms can derive by moving into international markets?

Accepted Answer

One reason is to extend the life cycle of the firm's products.Gaining access to needed and potentially scarce resources is another reason.There is also pressure for global integration of operations, driven by growing universal product demand.Companies also want to take advantage of opportunities to better use rapidly developing technologies such as the Internet and mobile applications, which permit greater integration of trade, capital, and culture.Finally, the potential of large demand for goods and services for people in emerging markets is an important incentive.When firms successfully move into international markets, they can experience: increased market size, economies of scale and learning, and location advantages.

Question 3

Firms with core competencies that can be exploited across international markets are able to:

Accepted Answer

A)   achieve synergies and produce high-quality goods at lower costs.
B)   enter new markets more quickly.
C)   enhance their market image and brand loyalty among local consumers.
D)   meet local government requirements more quickly than their international competitors. A

Question 4

When a firm initially pursues an international business-level strategy, the resources and capabilities established in the home country frequently allow the firm to pursue the strategy into markets located in other countries.

Accepted Answer

A) True 
 B)False

Question 5

All of the following are correct about what managers should know about firms based in a country with a national competitive advantage EXCEPT:

Accepted Answer

A)   continuous adjustments are needed based on the nature of competition encountered.
B)   the actual strategic choices made are most compelling reasons for success or failure.
C)   success is guaranteed as the firm implements its chosen international business-level strategy.
D)   the determinants of national competitive advantage provide a foundation for a firm's competitive advantages.

Question 6

A global corporate-level strategy assumes:

Accepted Answer

A)   efficiency and customization can be achieved simultaneously.
B)   a rise in income levels across the world.
C)   increasing levels of cultural differences among nations.
D)   more standardization of products across country markets.

Question 7

Location advantages are influenced by costs of production, access to natural resources and critical supplies, as well as the needs of customers, but not culture.

Accepted Answer

A) True 
 B)False

Question 8

The stabilization of returns through international diversification helps reduce a firm's overall risk.

Accepted Answer

A) True 
 B)False

Question 9

A U.S.manufacturer of pigments for household paint that exports about 40 percent of its production to European markets will find its sales will be harmed by a weak dollar.

Accepted Answer

A) True 
 B)False

Question 10

Terrorism creates an economic risk for firms, which:

Accepted Answer

A)   reduces the amount of investment foreign companies will make in a country perceived to be terror prone.
B)   is created by governmental bans on doing business with terrorist regimes.
C)   is offset by the above-average returns for firms that have learned how to operate in such an environment.
D)   is absorbed by firms that are highly geographically diversified and that operate in both secure and insecure locations.

Question 11

The problems associated with exporting include:

Accepted Answer

A)   merging corporate cultures.
B)   a partner's incompatibility.
C)   difficulty in negotiating relationships.
D)   high transportation costs and the expense of tariffs.

Question 12

A transnational strategy is difficult to use because of its conflicting goals.

Accepted Answer

A) True 
 B)False

Question 13

A global corporate-level strategy differs from a multidomestic corporate-level strategy in that in a global strategy:

Accepted Answer

A)   competitive strategy is dictated by the home office.
B)   competitive strategy is decentralized and controlled by individual strategic business units.
C)   products are customized to meet the individual needs of each country.
D)   the firm sells in multiple countries.

Question 14

A major advantage of multidomestic strategies is the ability to customize products and services for the specific market, although this sacrifices economies of scale.

Accepted Answer

A) True 
 B)False

Question 15

Even if effectively implemented, the transnational strategy often produces lower performance than does the implementation of either the multidomestic or global strategies.

Accepted Answer

A) True 
 B)False

Question 16

The greenfield venture option is useful when control of proprietary technology is important in an international expansion.

Accepted Answer

A) True 
 B)False

Question 17

Skaredykat Inc.is considering initial expansion beyond its home market.The firm has decided not to enter markets that differ greatly from its home market, instead expanding within the twelve-nation region that includes its home country.Which of the following statements is true?

Accepted Answer

A)   The firm is not engaging in international trade.
B)   The firm is using a regional approach to international expansion.
C)   The firm will not be able understand the cultures, legal, and social norms of this market.
D)   Skaredykat is too afraid to implement an international strategy.

Question 18

Increasingly, customers worldwide are demanding emphasis on local requirements and companies require efficiency as global competition increases.This has triggered an increase in the number of firms using the __________ strategy.

Accepted Answer

A)   multidomestic
B)   transnational
C)   universal
D)   global

Question 19

International diversification is a strategy through which a firm expands the sale of its goods or services across the borders of global regions and countries into a potentially large number of geographic locations of markets.Instead of entering one or just a few markets, the international diversification means that the firm enters multiple markets.

Accepted Answer

A) True 
 B)False

Question 20

Establishing a wholly owned subsidiary provides the quickest access to a new market.

Accepted Answer

A) True 
 B)False

Exam 8: International Strategy

In France, fine dressmaking and tailoring have been a tradition predating Queen Marie Antoinette.Cloth manufacturers, design schools, craft apprenticeship programs, modeling agencies, and so forth, all exist to supply the clothing industry.This is an example of the __________ in Porter's model.

What are some incentives for firms to use international strategies? What are the three basic benefits firms can derive by moving into international markets?

Firms with core competencies that can be exploited across international markets are able to:

When a firm initially pursues an international business-level strategy, the resources and capabilities established in the home country frequently allow the firm to pursue the strategy into markets located in other countries.

All of the following are correct about what managers should know about firms based in a country with a national competitive advantage EXCEPT:

A global corporate-level strategy assumes:

Location advantages are influenced by costs of production, access to natural resources and critical supplies, as well as the needs of customers, but not culture.

The stabilization of returns through international diversification helps reduce a firm's overall risk.

A U.S.manufacturer of pigments for household paint that exports about 40 percent of its production to European markets will find its sales will be harmed by a weak dollar.

Terrorism creates an economic risk for firms, which:

The problems associated with exporting include:

A transnational strategy is difficult to use because of its conflicting goals.

A global corporate-level strategy differs from a multidomestic corporate-level strategy in that in a global strategy:

A major advantage of multidomestic strategies is the ability to customize products and services for the specific market, although this sacrifices economies of scale.

Even if effectively implemented, the transnational strategy often produces lower performance than does the implementation of either the multidomestic or global strategies.

The greenfield venture option is useful when control of proprietary technology is important in an international expansion.

Skaredykat Inc.is considering initial expansion beyond its home market.The firm has decided not to enter markets that differ greatly from its home market, instead expanding within the twelve-nation region that includes its home country.Which of the following statements is true?

Increasingly, customers worldwide are demanding emphasis on local requirements and companies require efficiency as global competition increases.This has triggered an increase in the number of firms using the __________ strategy.

Establishing a wholly owned subsidiary provides the quickest access to a new market.