Question 1

Adaptability screening is used to assess how well managers and their families are likely to adjust to foreign cultures.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following trends has allowed companies to skip the phase model of globalization when going global?

Accepted Answer

A)  Countries with growing levels of purchasing power are good choices for attractive global markets. 
B)  Low-cost communication technologies make it easier to communicate with global customers. 
C)  Companies do not have to establish a manufacturing location in each country they enter. 
D)  Masculinity and femininity capture the difference between highly assertive and nurturing cultures.

Question 3

For initial fee plus royalties, Inding Inc., a U.S.-based firm, will provide Caliste Works, a firm based in Singapore, with an exclusive right to conduct Inding's business in its country. This form of global business is an example of a _____.

Accepted Answer

A)  wholly owned affiliate 
B)  conglomerate 
C)  franchise 
D)  joint venture

Question 4

One of the advantages of _____ is that the founding companies bear only part of the costs and the risks of that business.

Accepted Answer

A)  a business acquisition 
B)  direct foreign investment 
C)  direct exporting 
D)  a joint venture

Question 5

Zinocorp Inc., a multinational retail corporation with its headquarters in Australia, wants to open shopping malls in China and Japan. The company wants the new malls to follow the same set of rules and regulations that the parent company follows. It is evident from the scenario that Zinocorp Inc. wants to:

Accepted Answer

A)  incorporate local adaptation. 
B)  establish global consistency. 
C)  create franchises. 
D)  form strategic alliances.

Question 6

Global new ventures are foreign offices, facilities, and manufacturing plants that are 100 percent owned by the parent company.

Accepted Answer

A) True 
 B)False

Question 7

In the context of cross-cultural training, the practice of adapting to cultural differences is called:

Accepted Answer

A)  intercultural competence. 
B)  cultural conservatism. 
C)  cultural simulation. 
D)  multiculturalism.

Question 8

Hutlot Corp., a clothing company in the country of Pretnola, bought a small clothing company named Midlews in the country of Limlouth. Hutlot is going to sell its own designs through Midlews, and it believes that this venture will be extremely successful. This scenario is an example of _____.

Accepted Answer

A)  strategic alliance 
B)  direct foreign investment 
C)  direct export 
D)  joint venture

Question 9

Worthen, an information technology firm based in the U.S., was created with the goal of standardizing its services in all the developing nations of the world. Rather than strategizing for one country at a time, Worthen's plan is to focus on all the nations at the same time. Worthen is an example of a _____.

Accepted Answer

A)  licensee 
B)  strategic alliance 
C)  global new venture 
D)  franchise

Question 10

Which of the following best defines a tariff?

Accepted Answer

A)  It is a specific limit on the volume of imported goods. 
B)  It is a direct tax on imported goods. 
C)  It is a complete ban on trade of a certain item. 
D)  It is a limit on the number of products exported to a particular country.

Question 11

In the context of cross-cultural training, _____ is a technique in which trainees are placed in an ethnic neighborhood for three to four hours to talk to residents about cultural differences.

Accepted Answer

A)  field simulation training 
B)  documentary training 
C)  cultural simulation 
D)  adaptability screening

Question 12

According to the World Trade Organization (WTO), voluntary export restraints are legal and cannot be questioned.

Accepted Answer

A) True 
 B)False

Question 13

The _____ is a worldwide trade agreement that reduced and eliminated tariffs, limited government subsidies, and established protections for intellectual property.

Accepted Answer

A)  Asia-Pacific Economic Cooperation 
B)  General Agreement on Tariffs and Trade 
C)  Tripartite Free Trade Agreement 
D)  Maastricht Treaty

Question 14

_____ are specific limits on the number or volume of imported products.

Accepted Answer

A)  Tariffs 
B)  Quotas 
C)  Subsidies 
D)  Embargoes

Question 15

HungryFrank, a small eatery based in the U.S. was reporting losses and wanted to turn its business around. It decided to start using the same name and menu as JoeClub, a popular Italian restaurant, instead if its own. HungryFrank agreed to pay royalty fees to JoeClub to be able to use its menu and name. This form of agreement is an example of _____.

Accepted Answer

A)  direct foreign investment 
B)  exporting 
C)  licensing 
D)  protectionism

Question 16

Upstart Corp. was formed when Bencanc Corp. and Torperd Corp. pooled their resources to work on a construction project for the government. The project had a short turnaround time along with intensive requirements that could not be fulfilled by one company alone. In this context, Upstart Corp. is a _____.

Accepted Answer

A)  joint venture 
B)  global new venture 
C)  multinational franchise 
D)  wholly owned affiliate

Question 17

Limkwee, a Chinese company, is training its employees to work in Japan on a company project. It was learned that Japanese people cover their abdomen during rainstorms, which is not the case in China. In the context of cross-cultural training, when would the employees of the company have discovered this cultural difference?

Accepted Answer

A)  During documentary training 
B)  During cultural simulation 
C)  During field simulation 
D)  During adaptive screening

Question 18

Purchasing power is an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country.

Accepted Answer

A) True 
 B)False

Question 19

PriemCrest, an oral care company in the country of Holtmont, bought an oral care company called SerenCrest in the country of Hofstadden. This scenario is an example of _____.

Accepted Answer

A)  strategic alliance 
B)  direct foreign investment 
C)  direct export 
D)  joint venture

Question 20

Metzen Corp., a U.S.-based clothing company, plans to open a branch in Japan by sending its American employees there. Before doing so, the company educates its employees about Japan with the help of pictures, audiobooks, and video recordings to present real-world situations. In the context of preparing for an international assignment, when would this type of training be given to employees?

Accepted Answer

A)  During documentary training 
B)  During cultural simulation 
C)  During field simulation 
D)  During adaptive screening

Exam 8: Global Management

Adaptability screening is used to assess how well managers and their families are likely to adjust to foreign cultures.

Which of the following trends has allowed companies to skip the phase model of globalization when going global?

For initial fee plus royalties, Inding Inc., a U.S.-based firm, will provide Caliste Works, a firm based in Singapore, with an exclusive right to conduct Inding's business in its country. This form of global business is an example of a _____.

One of the advantages of _____ is that the founding companies bear only part of the costs and the risks of that business.

Global new ventures are foreign offices, facilities, and manufacturing plants that are 100 percent owned by the parent company.

In the context of cross-cultural training, the practice of adapting to cultural differences is called:

Hutlot Corp., a clothing company in the country of Pretnola, bought a small clothing company named Midlews in the country of Limlouth. Hutlot is going to sell its own designs through Midlews, and it believes that this venture will be extremely successful. This scenario is an example of _____.

Which of the following best defines a tariff?

In the context of cross-cultural training, _____ is a technique in which trainees are placed in an ethnic neighborhood for three to four hours to talk to residents about cultural differences.

According to the World Trade Organization (WTO), voluntary export restraints are legal and cannot be questioned.

The _____ is a worldwide trade agreement that reduced and eliminated tariffs, limited government subsidies, and established protections for intellectual property.

_____ are specific limits on the number or volume of imported products.

Purchasing power is an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country.

PriemCrest, an oral care company in the country of Holtmont, bought an oral care company called SerenCrest in the country of Hofstadden. This scenario is an example of _____.