Global Business Environment
Final Test Solutions
Course Introduction
Global Business Environment explores the complex dynamics shaping international commerce today. The course examines the key economic, political, legal, technological, and sociocultural factors impacting organizations operating across borders. Students will analyze how globalization influences business strategies, competitiveness, and decision-making processes, while also considering ethical challenges and emerging trends. Through the study of case studies and current events, learners will develop a practical understanding of how firms adapt to diverse environments, navigate international regulations, and manage cross-cultural differences in an interconnected world.
Recommended Textbook
Global Marketing 7th Edition by Warren J. Keegan
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17 Chapters
1530 Verified Questions
1530 Flashcards
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Page 2
Chapter 1: Introduction to Global Marketing
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Sample Questions
Q1) Nestlé, Unilever, GlaxoSmithKline, and Royal Philips Electronics can be considered transnational companies on the basis of:
A)sales outside the home country to total sales.
B)assets outside the home country to total assets.
C)employees outside the home country to total employees.
D)headquartered in a relatively small home-country market.
E)all of the above
Answer: E
Q2) Nontariff barriers (NTBs)are monetary restrictions on cross-border trade.
A)True
B)False
Answer: False
Q3) A European company that focuses its attention on Europe can be considered to have regiocentric orientation.
A)True
B)False
Answer: True
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Chapter 2: The Global Economic Environment
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Sample Questions
Q1) When the world's leaders meet to discuss policy issues, non-governmental organizations (NGOs):
A)are included in meetings.
B)often take advantage of the opportunity to make their voices heard.
C)sign final documents.
D)provide educational materials.
E)are excluded from meetings.
Answer: B
Q2) Upper-middle-income countries, also known as industrializing or developing countries, are those with GNI per capita ranging from:
A)$996 to $3,945
B)$3,946 to $12,195
C)$12,196 or higher
D)less than $995
E)no correct answer
Answer: B
Q3) During the past two decades production has become "uncoupled" from employment.
A)True
B)False
Answer: True
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Chapter 3: Regional Market Characteristics and Preferential Trade Agreements
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Sample Questions
Q1) Historically, most of the Latin American nations have witnessed decades of slow or no growth, crippling inflation, increasing foreign debt, protectionism, the bloated government payrolls, money laundering problems, and currency fluctuations.What measures are now being taken by countries in that region that will begin the process of economic transformations?
Answer: The allure of the Latin American market has been its considerable size, its strategic location, and huge resource base.Many countries are implementing economic reforms such as priority to have a balanced budget and privatization of certain industries.Free markets, open economies, and deregulation are becoming governmental priorities.Tariffs are being lowered, and free trades are being encouraged.Global corporations are encouraged by import liberalization, lower tariffs, and the potential for establishing more efficient regional production.Many observers envision a free trade area within the entire region.The four most important preferential trading arrangements in Latin America are the SICA, the Andean Community, the Common Market of the South (Mercosur), and the Caribbean Community and Common Market (CARICOM).
Q2) The WTO promotes free trade on a global basis.
A)True
B)False
Answer: True
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Chapter 4: Social and Cultural Environments
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Sample Questions
Q1) Gray color is associated with high quality and expensive in the United States, whereas it is considered inexpensive in China and Japan.
A)True
B)False
Q2) In the United States bridal gowns are white in color whereas in many countries they are red in color.White is considered as a color of mourning in many Asian countries.
A)True
B)False
Q3) Which of the following is true about the innovation diffusion process in Asia?
A)Japan has a high-context culture with a relatively homogeneous population.
B)Because risk avoidance is a cultural value, there are fewer innovators in Asia than in the United States.
C)Once innovators in Asia have tried a product, early adopters and the early majority quickly follow suit.
D)After a new product has achieved success in one Asian market, it is likely to be adopted in other Asian markets at an even faster rate.
E)all of the above are true
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6
Chapter 5: The Political, Legal, and Regulatory
Environments
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Sample Questions
Q1) "Sharia" and "haram" are important concepts in civil-code laws, which are commonly practiced in Middle Eastern countries.
A)True
B)False
Q2) What should a U.S.company do if competitors are willing to offer a bribe for business in a foreign country?
Q3) The company receiving the most U.S.patents for the year 2009 is:
A)Microsoft.
B)Panasonic.
C)IBM.
D)Toshiba.
E)Intel.
Q4) Categories of political risk listed by EIU (The Economist Intelligence Unit)includes all of the following except:
A)war.
B)political turmoil.
C)bureaucracy.
D)corruption.
E)crime.
Page 7
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Chapter 6: Global Information Systems and Market Research
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Sample Questions
Q1) What are the secondary sources of data and how do these sources differ from primary sources? Give examples of sources from which secondary data can be obtained.
Q2) Tools that can be used for collecting primary data include:
A)survey research and interviews.
B)consumer panels and observation.
C)focus groups and survey research.
D)interviews and observation.
E)all of the above
Q3) Which of the following is true about etic and emic approaches to country analysis?
A)The etic and emic approaches are identical.
B)An emic approach studies a culture from within; etic analysis is "from the outside."
C)An emic approach studies a culture "from the outside"; etic analysis studies a culture from within.
D)The emic/etic distinction is not useful in cultural studies.
E)The emic/etic approaches cannot be applied to Asian countries
Q4) What is meant by Comparative Analysis and Market Estimation by Analogy? How can these be helpful in marketing research?
Page 8
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Chapter 7: Segmentation, Targeting, and Positioning
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Sample Questions
Q1) Positioning refers to the act of:
A)determining on what points on the globe to target.
B)ensuring a choice retail shelf location.
C)differentiating a brand in customer's mind.
D)formulating a private label strategy.
E)formulating a companion product.
Q2) In 2009, the 10 most populous countries in the world account for just under 50% of world income; whereas the 10 most populous countries in the world account for roughly 60% of the world's population.
A)True
B)False
Q3) Global marketers must determine whether a standardized or an adapted marketing mix is required to best serve the wants and needs of the consumers.
A)True
B)False
Q4) What is psychographic segmentation, and how do marketers use it in targeting different world markets?
Q5) What are some of the pitfalls in assessing market potential and choosing target markets or segments?
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Chapter 8: Importing, Exporting, and Sourcing
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Sample Questions
Q1) Which of the following types of duties would be imposed on a company whose home-country government provided export subsidies?
A)ad valorem duty
B)countervailing duty
C)antidumping duty
D)specific duty
E)customs duty
Q2) Which of the following is sometimes referred to as a "buyer for export" or an "export commission house" and operates on behalf of a buyer from a foreign country?
A)foreign purchasing agent
B)export broker
C)export merchant
D)export management company
E)freight forwarder
Q3) Why does the tariff system vary from country to country? Explain, giving examples of tariffs imposed by the United States with particular emphasis on preferential tariffs.What are the conditions under which GATT allows the use of preferential tariffs?
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Chapter 9: Global Market Entry Strategies: Licensing, Investment, and Strategic Alliances
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Sample Questions
Q1) GM and South Korea's Daewoo Group formed a joint venture which helped Daewoo improve its competitiveness.The venture was terminated since Daewoo prevented the import of GM cars to Korea.
A)True
B)False
Q2) Which of the following is true about Japanese keiretsu?
A)Toyota is a vertical keiretsu, Mitsubishi is a horizontal keiretsu.
B)Toyota is a horizontal keiretsu, Mitsubishi is a vertical keiretsu.
C)Toyota and Mitsubishi are both horizontal keiretsu.
D)Toyota and Mitsubishi are both vertical keiretsu.
E)none of the above
Q3) Which of the following is not a characteristic of global strategic alliances?
A)Participants maintain independence outside the framework of alliance.
B)Participants share benefits of the alliance.
C)Participants share control over the performance of the assigned tasks.
D)Participants make ongoing contributions in technology, products, and other areas.
E)Participants agree not to compete in areas unrelated to the alliance.
Q4) Why would any firm, whether global or otherwise, seek to collaborate with another firm, be it local or foreign?
Page 11
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Chapter 10: Brand and Product Decisions in Global Marketing
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Sample Questions
Q1) Coca-Cola has developed several branded drink products for sale only in Japan, including a noncarbonated ginseng-flavored beverage.Using this as an example, outline the differences between local brand and global brand, combination branding, communication-branding, and brand extensions.
Q2) Perceptions and attitudes about a product's origins can be positive or negative.On the positive side, "German" is synonymous with quality engineering as "Italian" is with style.
A)True
B)False
Q3) Global brands are symbols of cultural ideals, and as such, marketers can use global consumer culture positioning (GCCP)to communicate a brand's global identity.
A)True
B)False
Q4) Products that fall under the dynamically continuous innovation category require more R & D expenditures.
A)True
B)False
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Chapter 11: Pricing Decisions
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Sample Questions
Q1) Price can be used as a strategic variable to achieve specific goals, including ROI, profit, and rapid recovery of product development costs.
A)True
B)False
Q2) Within the eurozone, "price transparency" means that buyers will be able to comparison shop easily because goods are priced in euros as opposed to marks, francs, or lira.
A)True
B)False
Q3) If a distributor's margins are based on the "landed" price of an import shipment, they will be based on:
A)ex-works price.
B)transportation costs.
C)insurance costs.
D)VAT.
E)all of the above
Q4) How can price be used as a strategic variable to achieve specific financial goals? Under what conditions should skimming or penetration pricing be adapted as strategies?
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Chapter 12: Global Marketing Channels and Physical Distribution
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Sample Questions
Q1) Which of the following does not qualify as a "category killer?"
A)Victoria's Secret
B)IKEA
C)Home Depot
D)Circuit City
E)Toys "R" Us
Q2) When British entrepreneur Richard Branson established the first Virgin Megastore in Japan, he established a joint venture with the Marui retailing chain.Judging by the approach Branson used, he and his management team must have viewed Japan as:
A)culturally close and easy to enter.
B)culturally distant and easy to enter.
C)culturally close and difficult to enter.
D)culturally distant and difficult to enter.
E)culturally difficult and easy to enter.
Q3) The Indian economy is growing rapidly, and many global businesses are looking toward moving into India.What types of challenges would global retailers be confronted with if they plan on going to India?
Q4) What are global retail categories? Describe these categories giving examples.
Page 14
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Chapter 13: Global Marketing Communications Decisions I:
Advertising and Public Relations
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Sample Questions
Q1) If the product needs a strong local identification, it would be best to select an international agency.
A)True
B)False
Q2) The words that are the spoken or written communication elements in advertisements are known as:
A)copy.
B)manuscript.
C)idea.
D)script.
E)writings.
Q3) In the language of global marketing, ________ is the phrase used to describe advertising that represents a middle ground between 100% standardization and 100% localization.
A)"stereotype advertising"
B)"template advertising"
C)"cookie-cutter advertising"
D)"compromise advertising"
E)"pattern advertising"
Page 15
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Chapter 14: Global Marketing Communications Decisions II:
Sales Promotion, Personal Selling, and Special Forms of Marketing Communication
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Sample Questions
Q1) Product placement has reached the world of live theater and opera.The difference between product placement and other forms of promotion is:
A)ethical concerns are not taken into account.
B)viewers are being marketed to subliminally without their consent.
C)products are focused showing different angles.
D)prominent personalities add a message about the product.
E)sponsors are recognized for their contribution.
Q2) A company with a regiocentric orientation is likely to utilize third-country nationals for its sales force in less developed countries.
A)True
B)False
Q3) Expo 2010 in Shanghai, China was the biggest expo in the world, which was mounted at an expense of $55 billion.
A)True
B)False
Q4) The final step in the 6-step sales presentation plan is closing the sale.
A)True
B)False
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Chapter 15: Global Marketing and the Digital Revolution
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Sample Questions
Q1) Bluetooth mobile communication technology has all of the following advantages over Wi-Fi except one:
A)Bluetooth is well suited for use with cell phones.
B)Bluetooth works over shorter distances than Wi-Fi.
C)Bluetooth consumes less power than Wi-Fi.
D)Bluetooth can handle data as well as voice.
E)Bluetooth technology has been incorporated into automobiles.
Q2) The market opportunity for the telecom sector in Africa is limited because the people are too poor, and it is too risky to do business there.
A)True
B)False
Q3) Ironically, Motorola, a key player in the cell phone business, could have been first to market with a cell phone camera.
A)True
B)False
Q4) Localizing a Web site in native language can be done by translating a Web site from the home-country language.
A)True
B)False
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Chapter 16: Strategic Elements of Competitive Advantage
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Sample Questions
Q1) According to the hypercompetition model of competitive advantage, which of the following allows the firm to create an entirely new product or market?
A)know-how advantage
B)timing advantage
C)outflanking
D)switching costs
E)countermoves
Q2) In the tech world, about 90% of the world's nearly one billion PCs run on Microsoft's operating systems and 80% use Intel's microprocessors.This represents which aspect of the Porter's five forces model?
A)bargaining power of suppliers
B)bargaining power of buyers
C)threat of substitute products
D)rivalry among competitors
E)threat of new entrants
Q3) Unique product attributes represent a barrier to industry entry known as differentiation.
A)True
B)False
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Page 18
Chapter 17: Leadership, Organization, and Corporate Social Responsibility
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Q1) Nike came under fire from critics who alleged poor working conditions in the factories that make the company's athletic shoes.
A)True
B)False
Q2) According to Kenichi Ohmae's view of the world, there are 30 regions with populations ranging from 5 million to 20 million people.Based on this, China would be viewed as several distinct regions.
A)True
B)False
Q3) Nike came under fire from critics who alleged poor working conditions in the factories that make the company's athletic shoes.This is an example of the demand for: A)labor unions.
B)equal opportunity employment.
C)higher wages.
D)standards for working conditions.
E)corporate social responsibility.
Q4) At Whirlpool, North American operations are organized in matrix form.What is the key to successful matrix management?
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