Denise International Busine chap 12 T/F questions PDF

Preview

Summary

International Business: The Challenges of Globalization, 7e (Wild) Chapter 12 Analyzing International Opportunities The first step in the screening of potential markets is an assessment of the national business environment. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summar...

Description

International Business: The Challenges of Globalization, 7e (Wild) Chapter 12 Analyzing International Opportunities 1) The first step in the screening of potential markets is an assessment of the national business environment. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 2) The first step in the identification of potential markets is an assessment of the basic demand for a product. Answer: TRUE Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 3) A country's climate plays an important role in determining the basic demand for a company's product. Answer: TRUE Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 4) Cultural elements can influence what kinds of products are sold and how they are sold in a country. Answer: TRUE AACSB: Multicultural and diversity understanding Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Explain how differences in culture affect the international business environment 5) Consumer products such as toothpaste and soft drinks undergo extensive adaptation to suit local preferences. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Explain how differences in culture affect the international business environment

1 Copyright © 2014 Pearson Education, Inc.

6) Governments bar international companies from entering economic sectors like energy exploration for security reasons. Answer: TRUE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Discuss arguments for and against government intervention in international business 7) Regulations for the purpose of environmental protection generally increase short-term production costs. Answer: TRUE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Discuss arguments for and against government intervention in international business 8) Volatile currency values make it easier for firms to predict future earnings accurately in terms of the home-country currency. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Summarize the roles of the international monetary system and global capital market 9) Products made in emerging countries tend to be evaluated more positively than those from relatively more developed countries. Answer: FALSE AACSB: Dynamics of the global economy Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Describe how global production and logistics decisions are made 10) Companies usually create a single marketing plan to be used in all markets in which they sell their products. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Explain the functions of marketing in international business

2 Copyright © 2014 Pearson Education, Inc.

11) A product's income-elasticity refers to the sensitivity of the price of a product relative to changes in the income of consumer population. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 12) A product for which demand increases more relative to an increase in income has an incomeelasticity coefficient less than 1. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Define the fundamental concepts of international business 13) Food and utilities are examples of income-inelastic products. Answer: TRUE Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 14) Assessing potential in emerging markets by ranking locations using market-potential indicators is useful only for companies involved in exporting. Answer: TRUE AACSB: Dynamics of the global economy Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 15) While assessing the market potential of emerging markets, market consumption capacity is generally obtained through estimates of energy consumption. Answer: FALSE Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets

3 Copyright © 2014 Pearson Education, Inc.

16) One of the main difficulties associated with conducting international market research is the measurability of data. Answer: FALSE Skill: Concept Objective: 2 Difficulty: Easy Course LO: Explain the functions of marketing in international business 17) The potential to conduct written surveys is independent of the literacy rates among the local population. Answer: FALSE Skill: Concept Objective: 2 Difficulty: Moderate Course LO: Explain the functions of marketing in international business 18) The process of obtaining information that already exists within the company is called secondary market research. Answer: TRUE Skill: Concept Objective: 3 Difficulty: Easy Course LO: Explain the functions of marketing in international business 19) Secondary data tends to be very expensive because it has already been analyzed and summarized by another party. Answer: FALSE Skill: Concept Objective: 3 Difficulty: Moderate Course LO: Explain the functions of marketing in international business 20) The process of collecting and analyzing original data and applying the results to current research needs is called primary market research. Answer: TRUE Skill: Concept Objective: 4 Difficulty: Easy Course LO: Explain the functions of marketing in international business

4 Copyright © 2014 Pearson Education, Inc.

21) Industry data cannot indicate how individuals feel about a company or its products. Answer: TRUE Skill: Concept Objective: 4 Difficulty: Moderate Course LO: Explain the functions of marketing in international business 22) Interviews and focus groups are two main sources of secondary data that help managers make informed decisions. Answer: FALSE Skill: Concept Objective: 3 Difficulty: Moderate Course LO: Explain the functions of marketing in international business 23) Trade missions are advantageous to small businesses as they are the most inexpensive method of getting introduced to important business contacts. Answer: FALSE Skill: Concept Objective: 4 Difficulty: Moderate Course LO: Explain the functions of marketing in international business 24) Focus group interviews tend to work best when moderators are natives of the countries where the interviews are held. Answer: TRUE Skill: Concept Objective: 4 Difficulty: Moderate Course LO: Explain the functions of marketing in international business 25) The single greatest disadvantage of survey research is that it provides access to only a small amount of data in a single sweep. Answer: FALSE Skill: Concept Objective: 4 Difficulty: Moderate Course LO: Explain the functions of marketing in international business

5 Copyright © 2014 Pearson Education, Inc.

26) Locating production facilities within regional markets is popular because ________. A) regional markets offer greater range of resources needed for production B) it provides duty-free access to every consumer in a trade bloc C) the marketing strategies applied at the regional market level will also be applicable at the global level D) it simplifies political and economic activities Answer: B Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Describe how global production and logistics decisions are made 27) The first step in the screening process for potential markets and sites is to ________. A) select a favorable market or site B) measure the market or site potential C) identify the basic appeal of a market D) assess the national business environment Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 28) Which of the following steps should occur in the screening process for potential markets after the basic demand for a product has been identified? A) assessment of the national business environment B) selection of the market or site C) measurement of the market or site potential D) assessment of climate suitability Answer: A Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets

6 Copyright © 2014 Pearson Education, Inc.

29) Which of the following is the final step in the screening process for potential markets and sites? A) assessment of the national business environment B) measurement of market or site potential C) selection of the market or site D) assessment of climate suitability Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 30) Which of the following steps of the market screening process involves examining the cost of transporting goods? A) identification of basic appeal of a market B) assessment of the national business environment C) measurement of market or site potential D) selection of the market or site Answer: B Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 31) Which of the following steps of the market screening process involves the analysis of the quality of workforce, materials, and infrastructure? A) identification of basic appeal of a market B) assessment of the national business environment C) measurement of market or site potential D) selection of the market or site Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets

7 Copyright © 2014 Pearson Education, Inc.

32) Which of the following steps of the the market screening process involves an evaluation of the government bureaucracy? A) identification of basic appeal of a market B) assessment of the national business environment C) measurement of market or site potential D) selection of the market or site Answer: B Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 33) Which of the following government regulations or actions would indicate that a government is quite receptive to international trade and investment? A) creating investment barriers to ensure domestic control of an industry B) requiring companies to divulge proprietary secrets C) allowing companies to remove profits earned in the domestic market D) barring companies entirely from certain sectors of the domestic economy Answer: C AACSB: Dynamics of the global economy Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Discuss arguments for and against government intervention in international business 34) The key element of political risk of greatest concern for global companies is ________. A) the cost of transporting materials and goods B) unforeseen political change C) currency and liquidity problems D) letting past political events blind future opportunities Answer: B Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Describe how differences in political economy influence economic development

8 Copyright © 2014 Pearson Education, Inc.

35) The likelihood that a society will undergo governmental changes that negatively affect local business activity is known as ________. A) volatility risk B) systemic risk C) political risk D) credit risk Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 36) Which of the following is an example of a legal force that is used to assess the national business environment? A) resource quality B) environmental regulations C) workforce qualifications D) liquidity issues Answer: B Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 37) Which of the following will most likely force international companies to cancel proposed investments? A) low rates of inflation B) increasing budget deficits C) rising productivity levels D) an appreciating currency Answer: B AACSB: Dynamics of the global economy Skill: Concept Objective: 1 Difficulty: Easy Course LO: Describe how global production and logistics decisions are made

9 Copyright © 2014 Pearson Education, Inc.

38) Which of the following steps of the screening process for potential markets involves the evaluation of fiscal and monetary policies of a nation? A) identification of basic appeal of a market B) measurement of market or site potential C) assessment of the national business environment D) selection of the market or site Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 39) Which of the following steps of the market screening process examines the effects of country image on market-entry decisions? A) identification of basic appeal of a market B) measurement of market or site potential C) assessment of the national business environment D) selection of the market or site Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 40) Which of the following is least likely to be caused by poor fiscal and monetary policies of a nation's central bank? A) high rates of inflation B) increasing budget deficits C) depreciating currency D) increasing levels of innovation Answer: D Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Summarize the roles of the international monetary system and global capital market

10 Copyright © 2014 Pearson Education, Inc.

41) ________ refers to management of the physical flow of products from the point of origin as raw materials to end users as finished products. A) Operations research B) Logistics C) Warehousing D) Environmental scanning Answer: B Skill: Concept Objective: 1 Difficulty: Easy Course LO: Describe how global production and logistics decisions are made 42) Which of the following statements is true about country image and its effects on global companies? A) It embodies all important facets of a nation's business environment. B) If a country's image is positive in one product class, it tends to be positive in all other product classes as well. C) An image, once formed, seldom changes over time. D) Products made in emerging countries are evaluated more positively than products made in developed countries. Answer: A Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Explain how differences in culture affect the international business environment 43) Which of the following steps of the market screening process involves the determination of a product's income elasticity? A) identification of basic appeal of a product B) measurement of market or site potential C) assessment of the national business environment D) selection of the market or site Answer: B Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets

11 Copyright © 2014 Pearson Education, Inc.

44) A typical industry analysis includes the ________. A) experience and qualifications of the researcher B) structure of the wholesale and retail distribution networks C) accurate forecast of unforeseen political changes in the country D) history of currency fluctuations Answer: B Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 45) The sensitivity of demand for a product relative to changes in income is called ________. A) income elasticity B) demand shaping C) income distribution D) market intensity Answer: A Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 46) In the context of the sensitivity of demand for a product relative to changes in income, a coefficient greater than 1.0 conveys a(n) ________. A) surplus product B) economic equilibrium C) economic surplus D) income-elastic product Answer: D Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 47) If the income-elasticity coefficient for coffee is 0.5, the demand for coffee will ________. A) decrease 0.5 percent for every 1.0 percent increase in income B) increase 1.0 percent for every 5.0 percent increase in income C) increase 0.5 percent for every 1.0 percent increase in income D) decrease 0.5 percent for every 0.5 percent increase in income Answer: C Skill: Concept Objective: 1 Difficulty: Moderate Course LO: Define the fundamental concepts of international business

12 Copyright © 2014 Pearson Education, Inc.

48) Which of the following is an income-elastic product? A) food B) utilities C) jewelry D) beverages Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Define the fundamental concepts of international business 49) Developing a market-potential indicator for an emerging market is useful for a company planning on ________. A) exporting B) licensing C) joint ventures D) acquisitions Answer: A Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 50) Which of the following variables involved in market-potential analyses allows managers to rank countries from the largest to the smallest, regardless of a particular product? A) market growth rate B) market intensity C) market size D) market consumption capacity Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets

13 Copyright © 2014 Pearson Education, Inc.

51) When developing a market-potential indicator for an emerging market, the size of the market is typically estimated from the nation's ________. A) income elasticity B) GDP C) total population D) GDP at purchasing power parity Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 52) When developing a market-potential indicator for an emerging market, market growth rate is typically estimated from the ________. A) per capita private consumption B) GDP C) total population D) percentage of a market's population in the middle class Answer: B Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 53) When developing a market-potential indicator for an emerging market, market intensity is typically estimated from the ________. A) per capita private consumption B) GDP C) total population D) percentage of a market's population in the middle class Answer: A Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets

14 Copyright © 2014 Pearson Education, Inc.

54) When developing a market-potential indicator for an emerging market, the ________ factor attempts to assess channels of distribution and communication. A) market size B) market intensity C) commercial infrastructure D) economic freedom Answer: C Skill: Concept Objective: 1 Difficulty: Easy Course LO: Summarize the main entry strategies and modes that businesses use to enter into foreign markets 55) When creating a market-potential indicator for an emerging market, market consumption capacity is often estimated from the ________. A) growth in gross domestic product B) percentage of a market's population in the middle class C) gross domestic product at purchasing power parity D) amount of energy the total population produces Answer: B Skill: Concept Objective: 1 Difficult...