Chapter 12 Multiple Choice Questions
1. The past 50 years have seen a rapid growth in international business activities as
companies seek to ____________________.
a) increase profit
b) diversify
c) reduce cost
d) expand their value-adding operations
2. For an international company, it is imperative to develop marketing strategies in order
to deal with _______________________.
a) increasing cost of doing business
b) high local taxes
c) political uncertainty
d) constant changes in global contexts
3. Which of the following is not a factor triggering companies to globalize?
a) search of growth and new markets
b) driven by prestige
c) more competition in their home country
d) low risk in foreign markets
4. There is a growing argument that business needs to adapt ______________________
to specific markets.
a) product, price, distribution, and promotion
b) products, production, and marketing strategies
c) sales, marketing, and production
d) product design, colour, and style
5. Which of the following is not a barrier to international marketing?
a) Language and culture
b) Currency compatibility and transfer of capital
c) Rising costs of moving inventories to foreign markets
d) Instability of governments
6. The four entry modes that are generally considered when entering foreign markets
are:
a) Exporting, licensing, joint venture, manufacturing
b) Exporting, licensing, joint venture, marketing
c) Exporting, licensing, franchising, manufacturing
d) Exporting, importing, joint venture, manufacturing
7. ___________ refers to situations where a firm manufactures products in one country
and transfers them to markets in another country.
a) Exporting
b) Importing
c) Licensing
d) Joint venture
8. In contrast to the ______________ entry mode, _____________ will allow firms to
have 100 per cent ownership.
a) exporting; joint venture
b) licensing, joint venture
c) exporting; manufacturing
d) joint venture; manufacturing
9. Which of the following is not an advantage of licensing?
a) Low resource commitment
b) Low capital risk
c) Protection of trademarks
d) Creates possible future competition
10. Which of the following is not an advantage of manufacturing?
a) Higher-level resource commitment
b) Lower transportation costs
c) Quick response to local demand
d) Access to local market intelligence
11. Exchange rate fluctuation is an example of:
a) International economic environment
b) International social and cultural environment
c) International technological environment
d) International political-legal environment
12. Labour conditions are an example of:
a) International economic environment
b) International social and cultural environment
c) International technological environment
d) International political-legal environment
13. The quest for international competitiveness in many cases instigates a strategy of
_________________.
a) globalization
b) differentiation
c) standardization
d) market penetration
14. Highly standardized products have easier access to the international market than
customized products because of the tendency to achieve wider market penetration
based on ___________ competitiveness.
a) brand
b) delivery
c) price
d) quality
15. A recurrent criticism of standardization is the tendency towards ____________ – that
is, treating foreign markets as if they were mirror images of the company’s home
market.
a) ethnocentrism
b) egocentrism
c) nationalism
d) internationalism