Global Strategic Management
Solved Exam Questions
Course Introduction
Global Strategic Management explores the frameworks, challenges, and opportunities of formulating and implementing business strategies in an international context. The course examines how multinational corporations develop strategies to compete effectively across diverse markets, navigate cultural and institutional differences, respond to global economic shifts, and manage international operations. Students analyze real-world cases to understand topics such as global industry dynamics, competitive advantage, entry strategies, strategic alliances, and the impact of technological and regulatory environments on global business decisions. Emphasis is placed on critical thinking, analytical skills, and adaptability required for successful management in a rapidly evolving global landscape.
Recommended Textbook
Global Business 3rd Edition by Mike Peng
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Page 2
Chapter 1: Globalizing Business
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Sample Questions
Q1) The _____ is measured as the sum of value added by resident firms,households,and governments operating in an economy.
A) gross national product
B) gross national income
C) gross domestic product
D) national reserve
Answer: C
Q2) The resource-based view of global business differs from the institution-based view of global business in that the resource-based view _____.
A) postulates the ideology of localization
B) supports the ideology of total globalization
C) focuses on the internal strengths on the firm
D) advocates adopting a single method for achieving globalization
Answer: C
Q3) Standardization of markets would lead to a state of semiglobalization.
A)True
B)False
Answer: False
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Chapter 2: Understanding Formal Institutions: Politics, Laws, and Economics
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Sample Questions
Q1) In which of the following ways do formal institutions regulate trade?
A) By inducing uncodified ethical beliefs into society
B) By putting faith in individuals to expose perceived wrong doings
C) By allowing the cultural beliefs of a society to dictate the terms of trade
D) By imposing laws that make certain trades unacceptable
Answer: D
Q2) Trademarks are legal rights awarded by government authorities to inventors of new products or processes.
A)True
B)False
Answer: False
Q3) Firms operating in democracies never confront political risk.
A)True
B)False
Answer: False
Q4) The cultural school of thought in economic development suggests that rich countries tend to be endowed with natural resources.
A)True
B)False Answer: False
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Chapter 3: Emphasizing Informal Institutions: Cultures, Ethics, and Norms
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Sample Questions
Q1) Members of a group or collective consider each other as _____.
A) in-group members
B) out-group members
C) individualistic members
D) cross-cultural members
Answer: A
Q2) Informal institutions are constructed on the regulatory pillars of a society.
A)True
B)False
Answer: False
Q3) Addressing bosses with honorary titles would be an instance of low power distance in a firm.
A)True
B)False
Answer: False
Q4) In socially mobile societies,education functions as a means to maintain social stratification.
A)True
B)False
Answer: False
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Chapter 4: Leveraging Resources and Capabilities
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Sample Questions
Q1) The point at which an industry-specific activity becomes common across industries and the need to keep it proprietary no longer exists is called _____.
A) commoditization
B) monopolization
C) break-even point
D) captive sourcing
Q2) Turning over an organizational activity to a domestic firm is called _____.
A) captive sourcing
B) onshoring
C) offshoring
D) nearshoring
Q3) Which of the following is true of OEMs?
A) It includes research and development in its value chain.
B) It does not include procurement of components in its value chain.
C) It does not include marketing in its value chain.
D) It does not include final assembly in its value chain.
Q4) The rarity of a firm's resources and capabilities is studied under the VRIO framework.
A)True
B)False
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Chapter 5: Trading Internationally
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Sample Questions
Q1) Which of the following ideas is closely linked to the theory of absolute advantage?
A) All international trade must be closely regulated by governments.
B) Free market forces should determine how much to trade with minimal government intervention.
C) Governments should actively protect domestic industries from imports and vigorously promote exports.
D) Nations should specialize in economic activities in which they have comparative advantage.
Q2) Briefly elaborate on any three nontariff barriers (NTBs).
Q3) The _____ theory advocates government intervention in highly capital-intensive,high entry-barrier industries in which domestic firms may have little chance without government assistance.
A) product life cycle
B) laissez faire
C) strategic trade
D) absolute advantage
Q4) Antidumping duties are levied on a country's exports.
A)True
B)False
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Chapter 6: Investing Abroad Directly
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Sample Questions
Q1) Government's confiscation of foreign assets is known as _____.
A) obsolescing bargains
B) sunk costs
C) expropriation
D) conflicting interests
Q2) Differentiate between the primary characteristics of horizontal and vertical FDI.
Q3) Internalization can help reduce opportunistic behavior in international trade.
A)True
B)False
Q4) The free market type of FDI is the most prevalent type of FDI practiced.
A)True
B)False
Q5) _____ refers to the clustering of economic activities in certain locations.
A) Internalization
B) Expropriation
C) Agglomeration
D) Intrafirm trade
Q6) Identify the benefits and costs of FDI to host countries.
Q7) What determines the success and failure of FDI around the globe?
Page 8
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Chapter 7: Dealing with Foreign Exchange
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Sample Questions
Q1) The post-Bretton Woods system is a system of flexible exchange rate regimes with
A) the Japanese yen as its common denominator
B) the American dollar as its common denominator
C) gold as its common denominator
D) no official common denominator
Q2) The theory of purchasing power parity suggests that in the absence of trade barriers,the price for identical products sold in different countries will be different.
A)True
B)False
Q3) In terms of international trade competitiveness,a strong dollar makes it easier for US firms to export and to compete on price when combating imports.
A)True
B)False
Q4) Forward transactions allow participants to buy and sell currencies now for future delivery.
A)True
B)False
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Chapter 8: Capitalizing on Global and Regional Integration
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Sample Questions
Q1) Which of the following is referred to as a multilateral trading system?
A) WTO
B) EU
C) NAFTA
D) ASEAN
Q2) Which of the following is true of the customs unions in South America?
A) The Andean Community's largest trading partner is China.
B) Mercosur is more pro-free trade than the Andean Community.
C) Andean Community and Mercosur countries are today integrated into the FTAA.
D) Mercosur is relatively more protectionist than the Andean Community.
Q3) The Trans-Pacific Partnership (TPP)is a multilateral free trade agreement that aims to further liberalize the economies of the entire Western Hemisphere.
A)True
B)False
Q4) Discuss whether global and regional economic integration create more benefits or more challenges.
Q5) NAFTA is a free trade agreement between Latin American countries.
A)True
B)False
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Chapter 9: Growing and Internationalizing the Entrepreneurial Firm
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Sample Questions
Q1) One hallmark of entrepreneurial growth is a dynamic,flexible,guerrilla strategy.
A)True
B)False
Q2) Foreign direct investment is the only way in which SMEs can enter foreign markets.
A)True
B)False
Q3) A letter of credit increases transaction costs by increasing transaction risks.
A)True
B)False
Q4) The growth of an entrepreneurial firm can be viewed as an attempt to more fully use currently underutilized resources and capabilities.
A)True
B)False
Q5) ____ is a way to reach overseas customers by exporting through domestic-based export intermediaries.
A) Direct exports
B) Licensing
C) Indirect exports
D) Letters of credit
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Chapter 10: Entering Foreign Markets
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Sample Questions
Q1) Cultural distance is the difference between two cultures along some identifiable dimensions.
A)True
B)False
Q2) One of the advantages of being a first-mover is the opportunity to free ride on late-mover investments.
A)True B)False
Q3) Non-equity modes do not require the establishment of independent organizations overseas.
A)True
B)False
Q4) A greenfield operation refers to _____.
A) a new corporate entity created and jointly owned by two or more parent companies
B) a wholly owned subsidiary created by building a new factory and offices from scratch
C) a wholly owned subsidiary created by acquisition
D) an outsourcing agreement in R&D between firms
Q5) Identify the advantages and disadvantages that pertain to first movers.
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Chapter 11: Managing Global Competitive Dynamics
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Sample Questions
Q1) _____ strategy centers on leveraging home-grown competencies abroad.
A) Contender
B) Extender
C) Defender
D) Dodger
Q2) Blue ocean strategy focuses on attacking core markets defended by rivals.
A)True
B)False
Q3) The percentage of total industry sales accounted for by the top firms is called:
A) commonality ratio.
B) collusion index.
C) concentration ratio.
D) barriers to entry.
Q4) The International Trade Administration investigates antidumping cases in the United States.
A)True
B)False
Q5) The price leader in a market possesses the capacity to punish.
A)True
B)False
Page 13
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Chapter 12: Making Alliances and Acquisitions Work
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Sample Questions
Q1) ____ refers to overconfidence in one's capabilities.
A) Hubris
B) Fringe
C) Decoupling
D) Andon
Q2) Pre-acquisition analysis often focuses on strategic fit,which is the effective matching of ____ strategic capabilities.
A) competitive
B) complementary
C) relational
D) collaborative
Q3) In an alliance,keeping critical skills and technologies not meant to be shared a secret helps prevent _____.
A) proxy fight
B) corporate raider
C) opportunism
D) hostile takeover
Q4) Elaborate on the institution-based view of alliances and acquisitions.
Q5) Describe how partners in an alliance can combat opportunism.
Q6) Describe the stages in the formations of alliances.
Page 14
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Chapter 13: Strategizing,Structuring,and Learning around the World
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Sample Questions
Q1) In a transnational strategy,the flow of knowledge is unidirectional.
A)True
B)False
Q2) The _____ strategy is also known as multidomestic strategy.
A) home replication
B) transnational
C) global
D) localization
Q3) The relationship between strategy and structure is reciprocal.
A)True
B)False
Q4) Explicit knowledge is codifiable.
A)True
B)False
Q5) In MNEs adopting the home replication strategy,knowledge is developed at the center and transferred to subsidiaries.
A)True
B)False
Page 15
Q6) Briefly explain which of the four organizational structures is appropriate for each of the MNE strategic choices.
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Page 16
Chapter 14: Competing on Marketing and Supply Chain Management
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Sample Questions
Q1) Technically,place in the four Ps of marketing is also often referred to as the _____.
A) production channel
B) vertical channel
C) distribution channel
D) traditional channel
Q2) _____ refers to a philosophy or way of thinking that places the highest priority on the creation of superior customer value in the marketplace.
A) Market orientation
B) Societal orientation
C) Relationship orientation
D) Sales orientation
Q3) In the context of segmentation based on customer categories,global citizens are always skeptical about whether global brands deliver high quality goods.
A)True
B)False
Q4) Price elasticity refers to the changes in demand when price changes.
A)True
B)False
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Chapter 15: Managing Human Resources Globally
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Sample Questions
Q1) MNEs with a _____ strategic orientation follow an ethnocentric staffing approach.
A) home replication
B) localization
C) global standardization
D) transnational
Q2) Relocating employees of a foreign subsidiary to the MNE's headquarters for the purposes of filling skill shortages at headquarters and developing a global mind-set for such employees is called _____.
A) onboarding
B) orientation
C) nepotism
D) inpatriation
Q3) Ethnocentrism continues to characterize many MNEs: knowledge transfer is typically one way-from headquarters to subsidiaries via expatriates.
A)True
B)False
Q4) What are the problems related with inpatriation?
Q5) Analyze managing labor relations at home and abroad.
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Chapter 16: Financing and Governing the Corporation
Globally
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Sample Questions
Q1) Explain the role of the Board of Directors.
Q2) Activities that enrich controlling shareholders at the expense of minority shareholders are referred to as _____.
A) amortization
B) accretion
C) backwardation
D) expropriation
Q3) Companies with diffused ownership have a separation of ownership and control.
A)True
B)False
Q4) The costs associated with principal-agent relationships are called _____.
A) principal costs
B) opportunity costs
C) agency costs
D) actual costs
Q5) The board of directors' effectiveness in serving the control function stems from their independence,deterrence,and norms.
A)True
B)False
Q6) Differentiate between concentrated and diffused ownership. Page 19
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Page 20
Chapter 17: Managing Corporate Social Responsibility
Globally
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Sample Questions
Q1) Which of the following is an example of a primary stakeholder group?
A) Shareholders
B) Fair labor practice groups
C) Public agencies
D) Environmental groups
Q2) The _____ strategy is characterized by some support from top managers,who may increasingly view CSR as a worthwhile endeavor.
A) accommodative
B) reactive
C) proactive
D) defensive
Q3) Failing to heed to certain CSR imperatives may be self-defeating in the long run.
A)True
B)False
Q4) Which of the following is an example of secondary stakeholder groups?
A) Suppliers
B) Environmental groups
C) Managers
D) Employee groups
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