Practice Questions on Ch. 11 – Global Strategy
1. A firm’s strategy should seek to maximize the difference between the value the firm
produces and the cost of producing it.
True
False
2. Firms that invest large amounts of money abroad tend to be less profitable because of the
cost of those investments.
True
False
3. Firms that pursue a global standardization strategy are essentially following a low-cost
strategy on a global scale.
True
False
4. International strategy is being followed when a firm customizes its products for
international markets and customers, sometimes involving a wide range of new options.
True
False
5. Pressures for local responsiveness arise from all of the following EXCEPT:
A. ways of cutting production costs.
A)
B. differences in customer tastes and preferences.
B)
C. distribution channels.
C)
D. host-government demands.
D)
6. A localization strategy seeks to increase profitability by:
marketing local goods instead of imported ones.
A)
B) brokering through strategic alliances with local partners.
C) customizing the firm's products to match local tastes.
D) offering discounts and promotions to match local needs.
7. Firms pursuing a transnational strategy are trying to:
actually move away from "brick and mortar"
A) operations.
B)
C)
D)
facilitate transborder trade with global partners.
maneuver competitors through host government
support.
achieve low costs through location economies while
also customizing product for local tastes.
Answers: 1) True. 2) False. 3) True. 4) False. 5) A. 6) C. 7) D.