Question 1

In a concentration strategy of foreign expansion,a company would go to ________.

Accepted Answer

A)  many countries very rapidly, and then build up slowly in each 
B)  a foreign country with one product and not sell other products in that country until a target market share is reached 
C)  a reporting system that measures performance on a regional rather than a country-by-country basis 
D)  one or a few foreign countries and build a strong involvement there before going to other countries

Question 2

Companies are more likely to gain advantages by locating near competitors for all the following reasons EXCEPT to ________.

Accepted Answer

A)  take advantage of competitors' research to pick an ideal location 
B)  attract multiple suppliers and personnel with specialized skills 
C)  agree with competitors on production limitations 
D)  attract buyers who want to compare suppliers

Question 3

In a short essay,compare the strategies of diversification versus concentration and provide examples of situations in which each would be used.

Accepted Answer

The answer of In a short essay,compare the strategies of...

Question 4

In assessing political risk,the observation of past patterns is problematic because situations may change for better or worse.

Accepted Answer

A) True 
 B)False

Question 5

Gucci,a maker of luxury fashion and leather goods,plans to expand its sales market.The firm needs to compare countries for the market potential of its products.Which of the following is the best indicator for Gucci to use?

Accepted Answer

A)  per capita income in each country 
B)  population size of each country 
C)  the number of millionaires in each country 
D)  gross domestic product for each country

Question 6

Which of the following is the LEAST likely reason for inaccuracies in published governmental data?

Accepted Answer

A)  translation errors from the host country language 
B)  limitations of government resources and finances 
C)  purposeful publication of misleading information 
D)  false information provided to data collectors

Question 7

Which of the following best explains why U.S.firms typically place earlier and greater emphasis on expansion into Canada and the U.K.?

Accepted Answer

A)  most significant sales opportunities 
B)  similarities in culture and legal systems 
C)  availability of necessary natural resources 
D)  government incentives for allied nations

Question 8

Committing resources to one country usually means forgoing or delaying projects in others.

Accepted Answer

A) True 
 B)False

Question 9

Grids are a useful method of comparing countries for international business expansion because they ________.

Accepted Answer

A)  generally show how countries will perform in the future 
B)  show risk on one axis and opportunity on another 
C)  set minimum scores for proceeding further 
D)  highlight first-mover advantages

Question 10

In which of the following situations would tax rate differences among countries be most important for deciding where to place an investment?

Accepted Answer

A)  Companies find advantages in being located near specialized private and public institutions. 
B)  Companies must compare the benefits of labor- versus capital-intensive production. 
C)  Companies want to serve an entire region within a regional trading bloc. 
D)  Companies must deal with difficult start-up regulations.

Question 11

Executives at Wilson Enterprises need to determine how to leverage and improve the firm's existing competencies on a global basis.What are the two most basic questions that they must answer?

Accepted Answer

A)  Which markets should we serve and where should production be located to serve those markets? 
B)  What are the short-term competitive advantages of the project and what is the return on investment? 
C)  What is the total investment required and what are the managerial resources needed to supervise the investment? 
D)  What is the availability of land and what is the cost of labor?

Question 12

The ability to compare production costs among countries in an effort to determine where to locate production is significantly hampered by all of the following EXCEPT ________.

Accepted Answer

A)  the number of ways the same product can be made 
B)  restrictions on the international flow of data 
C)  the ways that laws may be enforced 
D)  future costs from exchange rate changes

Question 13

When planning international geographic expansion,decision makers use scanning to reduce the number of options available to a manageable number for further detailed analysis.

Accepted Answer

A) True 
 B)False

Question 14

International managers most likely need to understand how to evaluate international geographic alternatives because ________.

Accepted Answer

A)  they usually have a surplus of resources and need to take advantage of all opportunities 
B)  many regional trading groups prohibit companies from outside of the trading group from manufacturing in more than one member country 
C)  the commitment of resources to one locale may require forgoing projects in other locales 
D)  decreased worldwide transportation costs and increased trade liberalization now allow companies to serve worldwide markets from a single production location

Question 15

Companies have tended to wait too long to divest poorly performing foreign facilities,trying instead to improve performance through expensive means.

Accepted Answer

A) True 
 B)False

Question 16

A company's operations are most likely to be taken over by a host government when ________.

Accepted Answer

A)  the operations are relatively small and, thus, unlikely to incur the wrath of the company's home government 
B)  the operations are substantial and have a widespread effect on the country because of the company's size 
C)  the host country becomes involved in a regional war 
D)  the firm produces discretionary rather than essential products

Question 17

The origin of investment proposals differs from the origin of divestment proposals in that the divestment proposals are more likely to come from ________.

Accepted Answer

A)  subsidiary management 
B)  outside the organization 
C)  higher up in the organization 
D)  line personnel as opposed to staff personnel

Question 18

Because many regional trading groups prohibit companies from producing in more than one member country,companies need to understand how to evaluate international geographic alternatives.

Accepted Answer

A) True 
 B)False

Question 19

What are the major types of published data that managers can use to compare countries? Describe the tools available to managers for making country comparisons.

Accepted Answer

The answer of What are the major types of published...

Question 20

Labor cost advantages gained by moving into a country with low wages may be short-lived because tax increases cancel out the low-wage advantages.

Accepted Answer

A) True 
 B)False

Exam 13: Country Evaluation and Selection

In a concentration strategy of foreign expansion,a company would go to ________.

Companies are more likely to gain advantages by locating near competitors for all the following reasons EXCEPT to ________.

In a short essay,compare the strategies of diversification versus concentration and provide examples of situations in which each would be used.

In assessing political risk,the observation of past patterns is problematic because situations may change for better or worse.

Gucci,a maker of luxury fashion and leather goods,plans to expand its sales market.The firm needs to compare countries for the market potential of its products.Which of the following is the best indicator for Gucci to use?

Which of the following is the LEAST likely reason for inaccuracies in published governmental data?

Which of the following best explains why U.S.firms typically place earlier and greater emphasis on expansion into Canada and the U.K.?

Committing resources to one country usually means forgoing or delaying projects in others.

Grids are a useful method of comparing countries for international business expansion because they ________.

In which of the following situations would tax rate differences among countries be most important for deciding where to place an investment?

Executives at Wilson Enterprises need to determine how to leverage and improve the firm's existing competencies on a global basis.What are the two most basic questions that they must answer?

The ability to compare production costs among countries in an effort to determine where to locate production is significantly hampered by all of the following EXCEPT ________.

When planning international geographic expansion,decision makers use scanning to reduce the number of options available to a manageable number for further detailed analysis.

International managers most likely need to understand how to evaluate international geographic alternatives because ________.

Companies have tended to wait too long to divest poorly performing foreign facilities,trying instead to improve performance through expensive means.

A company's operations are most likely to be taken over by a host government when ________.

The origin of investment proposals differs from the origin of divestment proposals in that the divestment proposals are more likely to come from ________.

Because many regional trading groups prohibit companies from producing in more than one member country,companies need to understand how to evaluate international geographic alternatives.

What are the major types of published data that managers can use to compare countries? Describe the tools available to managers for making country comparisons.

Labor cost advantages gained by moving into a country with low wages may be short-lived because tax increases cancel out the low-wage advantages.