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strategic exam 2-2

Created by: anonymou

Question	Answer
. International strategy refers to a(n): a. action plan pursued by American companies to b. strategy through which the firm sells products in markets outside the firm's domestic market.	b. strategy through which the firm sells products in markets outside the firm's domestic market.
Raymond Vernon states that the classic rationale for international diversification is to: a. pre-emptively dominate world markets b. avoid domestic governmental regulation. c. extend the product's life cycle.	c. extend the product's life cycle.
Which of the following is NOT an incentive for firms to become multinational? a. To gain access to consumers in emerging markets b. To gain easier access to raw materials c. To avoid high domestic taxation on corporate income	c. To avoid high domestic taxation on corporate income
The increased pressures for global integration of operations have been driven mostly by: a. new low-cost entrants. b. increasing demand for similar products. c. increased levels of joint ventures. d. the rise of governmental regulation.	b. increasing demand for similar products.
The benefits of expanding into international markets include each of the following opportunities EXCEPT: a. increasing the size b. economies of scale and learning. c. location advantages. d. favorable tax concessions and economic incenti	d. favorable tax concessions and economic incentives by home-country governments.
U.S. companies moving into the international market need to be sensitive to the need for local country or re a. increasing rejection of American b. the sophistication of the internationa c. consumer needs, political and legal structures,	c. consumer needs, political and legal structures, and social norms vary by country.
Which of the following is NOT a factor pressuring companies for local responsiveness? a. Differences in employment laws b. Customization due to cultural differences c. Government pressure for firms d. Availability of low labor costs	d. Availability of low labor costs
U.S. cola companies entered the global market because of: a. limited growth opportunities in their domestic market. b. lower labor costs in the emerging markets. c. economies of scale that offset research and development costs.	a. limited growth opportunities in their domestic market.
Moving into international markets is a particularly attractive strategy to firms whose domest a. demand a differentiation strategy f b. are limited in opportunities for growth. c. have developed unfriendl d. have too much regulation.	b. are limited in opportunities for growth.
Working in multiple international markets can provide firms with __________ perhaps even in terms of __________. a. location advantages; larger markets c. new learning opportunities; research and development activities	c. new learning opportunities; research and development activities
Firms able to standardize the processes used to produce, sell, distribute, and service their products acros a. learn how to continuously reduce costs b. increase investment c. access to a low-cost labor d. mitigate cultural differences.	a. learn how to continuously reduce costs while increase the value of their products.
Firms with core competencies that can be exploited across international markets are able to: a. achieve synergies and produce high-quality goods b. enter new markets more quickly. c. enhance their market image and brand loyalty	a. achieve synergies and produce high-quality goods at lower costs.
The location advantages associated with locating facilities in other countries can include all of the following EXCEPT: b. access to critical supplies. c. access to customers. d. evasion of host country governmental regulations.	d. evasion of host country governmental regulations.
Factors of production in Porter's model of international competitive advantage include all of the following EXCEPT: a. labor. b. capital. c. infrastructure. d. technology.	d. technology.
In Porter's model, if a country has both ________ and __________ production factors, it is likely to serve an industry well by spawnin a. basic; advanced b. advanced; generalized c. basic; generalized d. advanced; specialized	d. advanced; specialized
Japan, due to a lack of undeveloped land, would be an unusual choice of location for a U.S. cattle company a. Factors of production b. Demand conditions c. Related and supporting industries d. Firm strategy, structure, and rivalry	a. Factors of production
A fundamental reason for a country's development of advanced and specialized factors of production is often its: a. lack of basic resources. b. monetary wealth. c. small workforce. d. protective tariffs.	a. lack of basic resources.
The four aspects of Porter's model of international competitive advantage include all of the following EXCEPT: a. factors of production. b. demand conditions. c. political and economic institutions. d. related and supporting industries.	c. political and economic institutions.
Which pair of industries would NOT be considered as "related and supporting" under Porter's diamond model? a. Japanese cameras and copiers b. Italian leather-processing c. U.S. computers d. highway systems and the supply of debt capital	d. highway systems and the supply of debt capital
In France, fine dressmaking and tailoring have been a tradition predating Queen Marie Antoinette. a. strategy, structure, and rivalry among firms b. related and supporting industries c. demand conditions d. factors of production	b. related and supporting industries
A large domestic market can provide the country's industries a chance at dominating the world market a. they have been able to develop economies b. they have access to abundant c. the related and supporting industries	a. they have been able to develop economies of scale at home.
In addition to the four basic dimensions of Porter's "diamond" model, ____ may also contribute to the success or failure of firms. a. national work ethic b. educational requirements c. government policy d. national pride	c. government policy
All of the following are correct about what managers should know about firms based in a country with a national competitive advantage EXCEPT: a. success is not guaranteed b. the actual strategic choices c. success is guaranteed	c. success is guaranteed as the firm implements its chosen international business-level strategy.
All of the following are international corporate-level strategies EXCEPT the ____ strategy. a. multi-domestic b. universal c. global d. transnational	b. universal
International corporate-level strategy focuses on: a. the scope of operations through both product and geographic diversification. b. competition within each country. c. economies of scale. d. sophistication of monitoring and con	a. the scope of operations through both product and geographic diversification.
A multi-domestic corporate-level strategy is one in which: a. a corporation chooses b. the firm produces a standardized product c. the firm customizes the product d. the firm competes in a number of countries	c. the firm customizes the product for each country in which it competes.
A multi-domestic corporate-level strategy has ____ need for global integration and ____ need for local market responsiveness. a. low; low b. low; high c. high; low d. high; high	b. low; high
A global corporate-level strategy differs from a multi-domestic corporate-level strategy in that in a global strategy: a. competitive strategy is dictated by the home office. b. competitive strategy is decentralized and controlled	a. competitive strategy is dictated by the home office.
A global corporate-level strategy emphasizes: a. differentiated products. b. economies of scale. c. sensitivity to local product preferences. d. decentralizing control and limited monitoring.	b. economies of scale.
A global strategy: a. is easy to manage b. achieves efficient operations c. increases risk because decision making is centralized at the home office. d. lacks responsiveness to local markets.	d. lacks responsiveness to local markets.
A global corporate-level strategy assumes: a. efficiency and customizatio b. a rise in income levels across the world. c. increasing levels of cultural differences among nations. d. more standardization of products across country markets.	d. more standardization of products across country markets.
The transnational strategy is becoming increasingly necessary to compete in international markets for all the following reasons EXCEPT: c. differences in culture and institutional environments d. it is easy to use.	d. it is easy to use.
. In China, Starbucks is standardizing its operations while simultaneously decentralizing some decision-making responsibility to local levels a. transnational b. global c. differentiation d. multi-domestic	a. transnational
Increasingly, customers worldwide are demanding emphasis on local requirements and companies require efficiency as global co a. multi-domestic b. transnational c. universal d. global	b. transnational
The two important environmental trends that influence a firm's choice and use of international corporate-level strategies b. cost; quality c. regionalization; globalization d. liability of foreignness; regionalization	d. liability of foreignness; regionalization
Disney suffered lawsuits in France at Disneyland Paris as a result of the lack of fit between its transferred personnel policies a. the effects of regionalization. b. the risks of a multi-domestic strategy. c. the liability of foreignness.	c. the liability of foreignness.
_________ is the set of costs associated with unfamiliar operating environments; economic, administrative and cultural differences; and the challen a. Transnational risk b. Regionalization c. Liability of foreignnes	c. Liability of foreignnes
Associations such as the European Union, Organization of American States, and the North American Free Trade Association, encourage: a. global strategies. b. domestication. c. regional strategies. d. nationalization.	c. regional strategies.
. A firm may narrow its focus to a specific region of the world: a. because that market b. in order to obtain greater c. so that it can better understand the cultures, d. to take advantage of limited protectio	c. so that it can better understand the cultures, legal and social norms, and other factors that are important for effective competition in those markets.
Skaredykat Inc. is considering initial expansion beyond its home market. a. The firm is not engaging in international trade. b. The firm is using a regional approach to international expansion.	b. The firm is using a regional approach to international expansion.
Most firms enter international markets sequentially, introducing their ____ first. a. most innovative products b. largest and strongest lines of business c. most generic products, which will be more likely to generate universal product demand,	b. largest and strongest lines of business
A U.S. manufacturer of adaptive devices for persons with disabilities is considering expanding internationally. It is a fairly small company, but it is looking a. licensing. b. exporting. c. a strategic alliance. d. a greenfield venture.	b. exporting.
The choices that a firm has for entering the international market include all of the following EXCEPT: a. exporting. b. licensing. c. leasing. d. acquisition.	c. leasing.
The problems associated with exporting include: a. merging corporate cultures. b. a partner's incompatibility. c. difficulty in negotiating relationships. d. high transportation costs and the expense of tariffs.	d. high transportation costs and the expense of tariffs.
Which of the following is NOT a disadvantage associated with exporting? a. Potential loss of proprietary technologies b. High transportation costs c. Loss of control over distribution activities d. Tariffs imposed by local governments	a. Potential loss of proprietary technologies
A licensing agreement: b. is best way to protect proprietary technology from future competitors. c. allows a foreign firm to purchase the rights to manufacture and sell a firm's products within a host country.	c. allows a foreign firm to purchase the rights to manufacture and sell a firm's products within a host country.
Which of the following is NOT a typical disadvantage of licensing? a. Little control over the marketing of the products b. Licensees may develop a competitive product after the license expires d. Incompatibility of the licensing partners	d. Incompatibility of the licensing partners
All of the following are reasons why firms use international strategic alliances EXCEPT: a. sharing of risks and resources. b. alliances facilitate t c. learning new competencies particularly d. strategic alliances are easy to manage.	d. strategic alliances are easy to manage.
One of the primary reasons for failure of cross-border strategic alliances is: a. the incompatibility of the partners. b. conflict between legal and business systems. c. security concerns and terrorism. d. high debt financing.	a. the incompatibility of the partners.
If conflict in a strategic alliance or joint venture is not manageable, a(n) _______may be a better option. a. licensing strategy b. exporting strategy c. acquisition d. new wholly owned subsidiary	c. acquisition
Which of the following is NOT a disadvantage of international acquisitions? a. They b. The acquiring firm has to deal c. Merging the acquired and acquiring firm is difficult. d. It is the slowest way to enter a new market.	d. It is the slowest way to enter a new market.
The means of entry into international markets that offers the greatest control is: a. licensing. b. acquisitions. c. joint ventures. d. greenfield ventures.	d. greenfield ventures.
Which of the following is an advantage associated with greenfield ventures? a. Governmental support and subsidies in the host country b. The lower cost of this type of venture c. The level of control over the firm's operations	c. The level of control over the firm's operations
If intellectual property rights in an emerging economy are not well-protected, the number of firms in the industry is rapidly growing, and a. exporting b. strategic alliance c. a joint venture or wholly owned subsidiary d. licensing	c. a joint venture or wholly owned subsidiary
The decision of what entry mode to use is primarily based on all of the following factors EXCEPT: a. the industry's competitive conditions. b. the country's situation and government policies. c. the worldwide economic situation.	c. the worldwide economic situation.
When a firm INITIALLY becomes internationally diversified, its returns: a. remain stable. b. decrease. c. become more variable. d. increase.	b. decrease.
An international diversification strategy is one in which a firm: a. expands into nearby markets. b. expands into a potentially large number of geographic locations and markets. c. expands into one or a few markets.	b. expands into a potentially large number of geographic locations and markets.
Internationally diversified firms: a. earn greater returns on their innovations through larger or more numerous markets. b. are more likely to produce below-average returns for investors in the long run.	a. earn greater returns on their innovations through larger or more numerous markets.
Bunyan Heavy Equipment, a U.S. firm, is investigating expanding into Russia using a greenfield venture. c. the numerous and conflicting legal authorities in Russia. d. Russia's recent actions to gain state control of private firms' assets.	d. Russia's recent actions to gain state control of private firms' assets.
Terrorism creates an economic risk for firms, which: a. reduces the amount of investment foreign companies will make in a country perceived to be terror-prone. b. is created by governmental bans on doing business with terrorist regimes.	a. reduces the amount of investment foreign companies will make in a country perceived to be terror-prone.
Arkadelphia Polymers, Inc., earns 60 percent of its revenue from exports to Europe and Asia. The CEO of the company would be: a. concerned if the value of the dollar strengthened. b. pleased if the value of the dollar strengthened.	a. concerned if the value of the dollar strengthened.
The positive results associated with increasing international diversification have been shown to: a. continue as the level of international diversification increases. b. level off and become negative as diversification increases past some point.	b. level off and become negative as diversification increases past some point.
All of the following complicate the implementation of an international diversification strategy EXCEPT: a. widespread multilingualism. b. increased costs of coordination between business units. c. cultural diversity. d. logistical costs.	a. widespread multilingualism.

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