Hill12e Chapter 18 TB Answer Key PDF

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1 Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the priorInternational Business, 12e (Hill)Chapter 18 Global Marketing and R&D The set of choices the firm offers to its targeted markets is known as the marketing mix. Answer: TRUE Explanation...

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International Business, 12e (Hill) Chapter 18

Global Marketing and R&D

1) The set of choices the firm offers to its targeted markets is known as the marketing mix. Answer: TRUE Explanation: The marketing mix is the set of choices the firm offers to its targeted markets. Difficulty: 1 Easy Topic: The Role of the Marketing Mix in International Marketing Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 2) Four elements comprise the marketing mix: product attributes, distribution strategy, communication strategy, and pricing strategy. Answer: TRUE Explanation: The four elements that constitute a firm's marketing mix are product attributes, distribution strategy, communication strategy, and pricing strategy. Difficulty: 1 Easy Topic: The Role of the Marketing Mix in International Marketing Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 3) Markets can be segmented in only one way—by sociocultural factors. Answer: FALSE Explanation: Markets can be segmented in numerous ways: by geography, demography (sex, age, income, race, education level, etc.), sociocultural factors (social class, values, religion, lifestyle choices), and psychological factors (personality). Difficulty: 1 Easy Topic: Differences Between Domestic and International Marketing Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation

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4) The structure of market segments may differ significantly from country to country. Answer: TRUE Explanation: An important market segment in a foreign country may have no parallel in the firm's home country, and vice versa. Difficulty: 1 Easy Topic: Differences Between Domestic and International Marketing Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 5) Products sell well when their attributes match consumer needs. Answer: TRUE Explanation: Products sell well when their attributes match consumer needs (and when their prices are appropriate). Difficulty: 1 Easy Topic: Factors to Consider When Developing International Product Strategies Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 6) Firms based in less-developed nations tend to build a lot of extra performance attributes into their products. Answer: FALSE Explanation: Firms based in highly developed countries tend to build a lot of extra performance attributes into their products. These extra attributes are not usually demanded by consumers in less developed nations, where the preference is for more basic products. Difficulty: 1 Easy Topic: Factors to Consider When Developing International Product Strategies Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation

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7) If a firm manufactures its product in a particular country, it can sell directly to the consumer, to the retailer, or to the wholesaler. The same options are not available to a firm that manufactures outside the country. Answer: FALSE Explanation: The same options are available to a firm that manufactures outside the country. Plus, the firm may decide to sell to an import agent, which then deals with the wholesale distributor, the retailer, or the consumer. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 8) The four main differences between distribution systems worldwide are retail concentration, channel length, channel exclusivity, and channel quality. Answer: TRUE Explanation: The four main differences between distribution systems are retail concentration, channel length, channel exclusivity, and channel quality. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 9) In a concentrated retail system, there are many retailers, none of which has a significant share of the market. Answer: FALSE Explanation: In a concentrated retail system, a few retailers supply most of the market. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation

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10) An increase in car ownership, the number of two-income households, and the number of households with a refrigerator have all contributed to the more fragmented retail system found in developed countries. Answer: FALSE Explanation: There is a tendency for greater retail concentration in developed countries. Three factors that contribute to this are the increases in car ownership, number of households with refrigerators and freezers, and number of two-income households. All these factors have changed shopping habits and facilitated the growth of large retail establishments sited away from traditional shopping areas. Difficulty: 2 Medium Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 11) Concentrated retail systems tend to promote the growth of wholesalers to serve retailers, which lengthens channels. Answer: FALSE Explanation: Fragmented retail systems tend to promote the growth of wholesalers to serve retailers, which lengthens channels. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 12) The more fragmented the retail system, the more expensive it is for a firm to make contact with each individual retailer. Answer: TRUE Explanation: The more fragmented the retail system, the more expensive it is for a firm to make contact with each individual retailer. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation

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13) The entry of large discount superstores such as Tesco and Carrefour has shortened channel length in some countries. Answer: TRUE Explanation: The business model of these retailers is in part based upon the idea that in an attempt to lower prices, they cut out wholesalers and instead deal directly with manufacturers. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 14) Import agents are typically limited to independent trading houses. Answer: FALSE Explanation: Import agents are not limited to independent trading houses; any firm with a strong local reputation could serve as well. Difficulty: 1 Easy Topic: Factors to Consider When Designing International Distribution Strategies Learning Objective: 18-02 Recognize why and how a firm's distribution strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 15) Source effects occur when the receiver of the message evaluates the message based on the context of the message. Answer: FALSE Explanation: Source effects occur when the receiver of the message (the potential consumer in this case) evaluates the message on the basis of the status or image of the sender. Difficulty: 1 Easy Topic: Factors That Influence International Advertising and Promotion Strategies Learning Objective: 18-03 Identify why and how advertising and promotional strategies might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation

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16) A company that depends on mass media advertising to communicate its marketing message to potential consumers is using a push strategy. Answer: FALSE Explanation: A push strategy emphasizes personal selling rather than mass media advertising in the promotional mix. A pull strategy depends more on mass media advertising to communicate the marketing message to potential consumers. Difficulty: 1 Easy Topic: Factors That Influence International Advertising and Promotion Strategies Learning Objective: 18-03 Identify why and how advertising and promotional strategies might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 17) A push strategy makes sense when distribution channels are short. Answer: TRUE Explanation: Push strategies tend to be emphasized for industrial products or complex new products or when distribution channels are short and when few print or electronic media are available. Difficulty: 1 Easy Topic: Factors That Influence International Advertising and Promotion Strategies Learning Objective: 18-03 Identify why and how advertising and promotional strategies might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 18) In highly developed countries, in the context of communication, noise tends to be low. Answer: FALSE Explanation: In highly developed countries such as the United States, noise is extremely high. Fewer firms vie for the attention of prospective customers in developing countries; thus, the noise level is lower. Difficulty: 1 Easy Topic: Factors That Influence International Advertising and Promotion Strategies Learning Objective: 18-03 Identify why and how advertising and promotional strategies might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation

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19) The longer the distribution channel, the more intermediaries there are that must be persuaded to carry the product for it to reach the consumer. Answer: TRUE Explanation: The longer the distribution channel, the more intermediaries there are that must be persuaded to carry the product for it to reach the consumer. This can lead to inertia in the channel, which can make entry difficult. Difficulty: 1 Easy Topic: Factors That Influence International Advertising and Promotion Strategies Learning Objective: 18-03 Identify why and how advertising and promotional strategies might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 20) In a competitive market, prices have to be higher than in a market where the firm has a monopoly. Answer: FALSE Explanation: Price discrimination involves charging whatever the market will bear; in a competitive market, prices may have to be lower than in a market where the firm has a monopoly. Difficulty: 2 Medium Topic: Elements That Influence International Pricing Strategies Learning Objective: 18-04 Explain why and how a firm's pricing strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 21) Elasticity of demand for a product in a given country is determined by income level and competitive conditions. Answer: TRUE Explanation: The elasticity of demand for a product in a given country is determined by a number of factors, of which income level and competitive conditions are the two most important. Difficulty: 1 Easy Topic: Elements That Influence International Pricing Strategies Learning Objective: 18-04 Explain why and how a firm's pricing strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation

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22) Predatory pricing refers to the fact that a firm's pricing strategy in one market may have an impact on its rivals' pricing strategy in another market. Answer: FALSE Explanation: Multipoint pricing refers to the fact that a firm's pricing strategy in one market may have an impact on its rivals' pricing strategy in another market. Predatory pricing is the use of price as a competitive weapon to drive weaker competitors out of a national market. Difficulty: 1 Easy Topic: Elements That Influence International Pricing Strategies Learning Objective: 18-04 Explain why and how a firm's pricing strategy might vary among countries. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 23) Firms pursuing a multipoint pricing strategy on an international scale will price low worldwide in an attempt to build global sales volume as rapidly as possible. Answer: FALSE Explanation: Many firms pursuing an experience pricing curve strategy on an international scale will price low worldwide in attempting to build global sales volume as rapidly as possible, even if this means taking large losses initially. Such a firm believes that in several years, when it has moved down the experience curve, it will be making substantial profits and have a cost advantage over its less aggressive competitors. Difficulty: 1 Easy Topic: Elements That Influence International Pricing Strategies Learning Objective: 18-04 Explain why and how a firm's pricing strategy might vary among countries. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 24) "Creative destruction" makes it important for companies to stay on the leading edge of technology. Answer: TRUE Explanation: "Creative destruction" unleashed by technological change makes it critical that a firm stay on the leading edge of technology, lest it lose out to a competitor's innovations. Difficulty: 1 Easy Topic: How Globalization Affects New-Product Development Learning Objective: 18-07 Describe how globalization is affecting product development. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation

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25) The rate of new-product development seems to be lesser in countries where more money is spent on basic and applied research and development. Answer: FALSE Explanation: The rate of new-product development is greater in countries where more money is spent on basic and applied research and development. Difficulty: 2 Medium Topic: How Globalization Affects New-Product Development Learning Objective: 18-07 Describe how globalization is affecting product development. Bloom's: Understand AACSB: Knowledge Application Accessibility: Keyboard Navigation 26) Tight cross-functional integration among R&D, production, and marketing maximizes the time to market. Answer: FALSE Explanation: Tight cross-functional integration among R&D, production, and marketing can help a company to ensure that time to market is minimized. Difficulty: 1 Easy Topic: How Globalization Affects New-Product Development Learning Objective: 18-07 Describe how globalization is affecting product development. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 27) For a product development team to function effectively and meet all its development milestones, the team should be composed of at least one member from each key function. Answer: TRUE Explanation: For effective functioning, a product development team should be composed of at least one member from each key function. Difficulty: 1 Easy Topic: How Globalization Affects New-Product Development Learning Objective: 18-07 Describe how globalization is affecting product development. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation

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28) The set of choices the firm offers to its targeted market is known as the A) marketing mix. B) marketing concept. C) marketing strategy. D) market promotion. Answer: A Explanation: The marketing mix is the set of choices the firm offers to its targeted markets. Many firms vary their marketing mix from country to country, depending on differences in national culture, economic development, product standards, distribution channels, and so on. Difficulty: 1 Easy Topic: The Role of the Marketing Mix in International Marketing Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation 29) A major factor of success for new products is the closeness of the relationship between A) finance and marketing. B) marketing and R&D. C) finance and materials management. D) finance and R&D. Answer: B Explanation: Only marketing can tell R&D whether to produce globally standardized or locally customized products. Research has long maintained that a major contributor to the success of new-product introductions is a close relationship between marketing and R&D. Difficulty: 1 Easy Topic: How Globalization Affects New-Product Development Learning Objective: 18-01 Explain why it might make sense to vary the attributes of a product from country to country. Bloom's: Remember AACSB: Knowledge Application Accessibility: Keyboard Navigation

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30) According to Levitt, which of the following statements is true? A) Technology drives the world toward a converging commonalty. B) There are accustomed differences in national preferences. C) The multinational corporation operates in a number of countries at low relative costs. D) The global corporation operates with resolute consistency at high relative costs. Answer: A Explanation: Levitt says that a powerful force drives the world toward a converging commonalty, and that force is technology. It has proletarianized communication, transport, and travel. Difficulty: 2 Me...