405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
1) The broadening set of interdependent relationships among people
from different parts of the world is known as ________.
A) Globalization
B) Offshoring
C) Franchising
D) Outsourcing
2) The European Union is an example of ________ integration.
A) Regional
B) Relative
C) Global
D) Bilateral
3) Global integration occurs as countries from all over the world
decide to cooperate through the ________.
A) EU
B) NAFTA agreement
C) WTO
D) CARICOM
4) Which of the following best defines international business?
A) It includes all public economic flows between two or more
countries.
B) It includes all private economic flows between two or more
countries.
C) It includes all business transactions involving two or more
countries.
D) It includes all business transactions in countries other than your
home country.
5) Which of the following is NOT a likely reason to study
international business?
A) Global events affect almost all companies.
B) Physical, social, and competitive conditions differ from country
to country.
C) Business conducted outside the confines of any one country is
inexplicably on the decline.
D) Firms are better able to obtain needed resources by approaching
operating strategies from an international standpoint.
6) Why should managers have an understanding of trade
protectionism?
A) Trade protectionism targets factor endowments, thus affecting
the best country to locate
Production.
B) Trade protectionism affects a company's ability to sell abroad and
ability to compete at home.
C) Trade protectionism affects the number of people permitted to
practice a specific profession.
D) Trade protectionism prevents companies' enactment of merger
and acquisition agreements.
7) Why should managers in international business understand
international trade theories?
A) Countries' trade policies, based on trade theories, influence which
products companies might export to given countries.
B) The understanding helps managers decide whether their
companies should follow laissez-faire management practices.
C) The theories help managers decide whether to use large-scale
versus small-scale technologies for serving their export markets.
D) The comprehension is useful when deciding whether to transfer
managers abroad to manage foreign operations.
1 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
8) Which of the following undesirable results will most likely occur
for a country running a favourable balance of trade?
A) Higher unemployment
B) Higher domestic interest rates
C) Fewer funds to invest abroad
D) Granting credit that may be risky
9) Most of the world's goods and services are sold ________.
A) In international markets
B) In the countries where they are produced
C) Through exports to small countries
D) Through exports to large countries
10) Successful trade retaliation is most likely achieved ________.
A) On agricultural products
B) On manufactured products
C) By a large trading country
D) By a small trading country
11) As a leading exporter of luxury automobiles, Germany has built
a strong reputation in engineering. Germany's trade most likely
relies on a (n) ________.
A) Outward immigration restriction
B) Natural advantage
C) Acquired advantage
D) Neomercantilist policy
12) Which of the following has NOT been a major force increasing
globalization in recent decades?
A) Liberalization of cross-border trade
B) Increase in and expansion of technology
C) Growing pressure from consumers
D) Decreasing global competition
13) Nontradable goods are best defined as ________.
A) Products and services for which exporting costs are excessive
B) Factors of production that exceed safety regulations
C) Goods used for national defence
D) Products that comprise a portion of the inputs for finished
products
14) ________ consists of specific learned norms based on attitudes,
values, and beliefs of a group of people.
A) Ethnology
B) Civilization
C) Culture
D) Doctrine
15) Which of the following is NOT true about cultural diversity?
A) Companies may gain competitive advantages by bringing
together people of diverse backgrounds.
B) Cultural diversity is most successful when domestic and foreign
firms establish joint ventures.
C) Cultural diversity may help a company gain deeper knowledge
about products and services.
D) The process of bringing people of different national cultures
together is often difficult.
16) Because people can be grouped in many ways, such as on the
2 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
basis of nationality, ethnicity, religion, profession, and income level,
________.
A) People live in a state of cultural collision
B) Cultural studies fail to understand behaviours
C) Identity crises make individual's lives chaotic
D) People have more than one cultural group membership
17) When divergent cultures come in contact, ________ occurs.
A) Power distance
B) Culture shock
C) Cultural collision
D) Group membership
18) Which of the following best describes a condition under which
cultural collision would most likely occur in international business?
A) A company implements practices that are less effective than
intended.
B) Local employees are overlooked for promotions by home country
managers.
C) Expatriate managers rely too heavily on local employees for
negotiating business deals.
D) Foreign and domestic companies make adjustments for the local
culture and legal environment.
19) Which of the following is a true statement about China?
A) The Chinese government's shift from communism to capitalism
has led to an increase in FDI.
B) China attracts FDI because the government has eliminated
elaborate bureaucracies.
C) The Chinese government manipulates market activities for
political purposes.
D) China lacks an educated pool of employees due to latent
industrialization.
20) Which of the following problems in China is blamed for the
annual loss of $250 billion by American MNEs?
A) Theft of intellectual property
B) Environmental hazards
C) Child labour violations
D) Embezzlement
21) Which of the following countries has an individualistic
orientation?
A) Venezuela
B) Japan
C) Egypt
D) Canada
22) Which of the following asserts that a government should NOT
interfere in business affairs?
A) Collectivism
B) Laissez-faire
C) The rule of man
D) Pluralism
23) The principle that an individual has the freedom to pursue his or
her interests is called ________.
A) Socialism
B) Totalitarianism
C) Individualism
D) Collectivism
3 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
24) The recent global economic crisis has led to which of the
following?
A) Governments seeking to impose more constraints on capitalism
B) Governments seeking to eliminate constraints on capitalism
C) Governments seeking to increase the interdependence of
developing economies
D) Governments seeking to eliminate the interdependence of
developing economies
25) Which of the following is most likely a true statement about the
global economy since the 1980s?
A) Socialist governments are intervening more in global exchanges.
B) Wealthy countries are maintaining total control of expanding
markets.
C) Developing countries are losing their share of foreign-exchange
reserves.
D) Emerging economies are adopting the principles and practices of
free markets.
________.
A) Life expectancy
B) Literacy
C) Environmental sustainability
D) Diversity
28) History suggests that if the economic crisis worsens, we are
likely to see more people question the ________.
A) Fall of communism
B) Legitimacy of capitalism
C) Practicality of mixed market economies
D) Correlation between economic freedom and prosperity
29) Which of the following is NOT a key stakeholder group that a
company must work to satisfy in order to survive in a global
environment?
A) Employees
B) Competitors
C) Shareholders
D) Customers
26) Since the late 1980s, the growing emergence of freer markets
has been powered by the realization that ________.
A) Economic growth is directly related to economic freedom
B) Economic growth has a limited effect on the standard of living
C) Adoption of free market principles contributes to social injustices
D) Centrally planned economies are best designed to deliver
progress
30) Which stakeholder group primarily wants additional sales and
increased productivity?
A) Customers
B) Shareholders
C) Society at large
D) Government
27) The Economic Freedom Index indicates that economic freedom
is positively correlated with all of the following EXCEPT
31) Which stakeholder group is most interested in trustworthy
behaviour by corporate executives and increased corporate taxes?
4 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
A) Shareholders
B) Society
C) Employees
D) Customers
32) Which of the following statements is most likely true regarding
relationships between MNEs and stakeholders?
A) An MNE typically serves all stakeholder groups equally at any
given time.
B) No individual stakeholder group is powerful enough to cause the
demise of an MNE.
C) All stakeholders of an MNE have the same short-term and longterm goals and interests.
D) The inability to adequately meet the long-term needs of all
stakeholders increases the probability of an MNE failing.
33) Monique has recently been hired as an accounts supervisor at
Ballston Enterprises. She wants to understand Ballston's values and
its expectations for employee behaviour. Which of the following
would most likely provide Monique with this information?
A) Mission statement
B) Code of conduct
C) Vision statement
D) Employee contract
34) All countries face the questions of what, how much, and with
whom they should import and export. How they answer these
questions primarily affects whether ________.
A) Non-taxable goods become tradable
B) Products go through a lengthy life cycle
C) Companies adhere to laissez-faire export policies
D) A company's present production location will be competitive
35) The trade theory that says a country should export more than it
imports is known as ________.
A) Mercantilism
B) Absolute advantage
C) Comparative advantage
D) Import substitution
36) Under mercantilism, governments sought to influence trade by
________.
A) Establishing bilateral trading agreements with other countries
B) Limiting exports
C) Limiting imports and subsidizing exports
D) Encouraging the development of manufacturing in their colonies
37) Country X runs a favourable balance of trade. Which of the
following undesirable results will most likely occur?
A) Higher unemployment
B) Higher domestic interest rates
C) Lower value of global investments
D) Lower credit value for purchasing goods
38) Neomercantilism describes the approach of countries that try to
run a favourable balance of trade to ________.
A) Build up gold reserves
B) Achieve a political objective
C) Lower their rates of inflation
D) Buy raw materials more cheaply
5 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
39) Countries with varied climates and varied natural resources
generally ________ than countries with less varied climates and
natural resources.
A) Have lower per capita incomes
B) Depend less heavily on trade
C) Have more ethnic subgroups
D) Have higher endowments of capital relative to labour
40) Eight of the top 10 exporting and importing countries are
countries with ________.
A) Cheap labour forces
B) Small landmasses
C) Natural advantages
D) Developed economies
41) Most world trade takes place ________.
A) Between developed countries and developing countries
B) Among developed countries
C) Among developing countries
D) Between raw material exporters and manufacturing exporters
42) History suggests that if the economic crisis worsens, we are
likely to see more people question the ________.
A) Fall of communism
B) Legitimacy of capitalism
C) Practicality of mixed market economies
D) Correlation between economic freedom and prosperity
43) Which of the following is NOT a key stakeholder group that a
company must work to satisfy in order to survive in a global
environment?
A) Employees
B) Competitors
C) Shareholders
D) Customers
44) The recent global economic crisis has led to which of the
following?
A) Governments seeking to impose more constraints on capitalism
B) Governments seeking to eliminate constraints on capitalism
C) Governments seeking to increase the interdependence of
developing economies
D) Governments seeking to eliminate the interdependence of
developing economies
45) Which stakeholder group primarily wants additional sales and
increased productivity?
A) Customers
B) Shareholders
C) Society at large
D) Government
46) Ethical dilemmas tend to be ________ for MNE managers than
for domestic managers.
A) More complicated
B) Less controversial
C) Easier to decide
D) Less common
47) Which of the following problems in China is blamed for the
annual loss of $250 billion by American MNEs?
A) Intellectual property violations
B) Environmental hazards
6 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
C) Child labour violations
D) Embezzlement
48) Since the late 1980s, the growing emergence of freer markets
has been powered by the realization that ________.
A) Economic growth is directly related to economic freedom
B) Economic growth has a limited effect on the standard of living
C) Adoption of free market principles contributes to social injustices
D) Centrally planned economies are best designed to deliver
progress
49) Which of the following statements best describes a pluralistic
society?
A) Multiple segments of society adhere to the same political
philosophy.
B) Two dominant political parties rule local and federal
governments.
C) Different ideologies are held by different segments of society.
D) Various ethnic groups belong to the official political party.
B) Although most cultural variables are universal, the forms these
variables take differ from culture to culture.
C) Most cultural variables are superficial and can easily be
influenced by environmental factors.
D) Within a culture, everyone responds to particular cultural
variables the same way.
52) Which stakeholder group is most interested in trustworthy
behaviour by corporate executives and increased corporate taxes?
A) Shareholders
B) Society
C) Employees
D) Customers
53) Which of the following is a primary business objective for
pursuing ethical behaviour?
A) Avoiding industrial sanctions
B) Developing competitive advantages
C) Developing creative advertisements
D) Discouraging false commitments to the firm
50) Which of the following most likely complicates ethical
behaviour for firms that expand overseas?
A) Local laws and values
B) Expatriate management
C) Unstable financial settings
D) International codes of conduct
51) Which of the following is the most accurate statement about
culture?
A) Cultural variables can easily be isolated from other factors such
as economic and political conditions.
54) Businesspeople seeking to understand more about another
culture in order to successfully conduct business within that culture
would be best advised to do which of the following?
A) Observing the behaviour of people who have gained respect
within that cultural environment
B) Relying on stereotypes, which are based on averages, to gain an
understanding of the culture
C) Avoiding cultural research studies because they perpetuate
unjustified stereotypes and behaviours
D) Memorizing the cultural variations that are typically encountered
7 405 INTERNATIONAL BUSINESS MCQs (weeks 1-5)
in a specific cultural environment
55) The distinguishing feature of political ideologies along the
political spectrum is ________, with some emphasizing its primacy
and others opposing it.
A) Capitalism
B) Socialism
C) Freedom
D) Liberalism
56) In terms of international business, it is most accurate to say that
________.
A) There is a universal "best way" to conduct business
B) Global competition affects large companies but not small ones
C) Most firms depend either on foreign markets and supplies or
compete against companies that do
D) Government regulation of international business has little effect
on a company's profits
57) Which of the following statements most accurately describes the
relationship between trading groups and MNEs?
A) Trading groups have no influence on the size of the regional
market.
B) Regional trading groups can define the rules under which
companies must operate within that region.
C) Companies never need to change their organizational structure to
take advantage of regional trading groups.
D) Regional trading groups have no influence on an MNE's strategy
since they operate worldwide.
most likely concern about the foreign country's response?
A) The foreign producers raising the prices of their exports
B) The foreign country restricting its own imports
C) The foreign country restricting its exports in that industry
D) The foreign producers seeking other markets
59) Which of the following is an indication of the increased
globalization of business since the end of World War II?
A) Foreign trade has largely replaced foreign ownership as a means
of conducting international business.
B) World trade has grown more rapidly than world production.
C) Globally, consumers now depend on foreign output for more than
half their consumption.
D) Countries have increased their import restrictions to counter the
rising tide of imports.
60) Global integration occurs as countries from all over the world
decide to cooperate through the ________.
A) EU
B) NAFTA agreement
C) WTO
D) CARICOM
58) Assume a government places restrictions on a specific product
from a specific foreign country. What would be the government's
8