Global Strategy Study Guide Questions
Course Introduction
Global Strategy explores how organizations develop, implement, and adapt their strategies to compete successfully in international markets. The course examines frameworks and tools for analyzing global competition, understanding cross-cultural dynamics, managing international operations, and responding to the complex challenges posed by globalization. Key topics include market entry strategies, global value chains, coordination across borders, and the impact of economic, political, and technological trends on multinational enterprises. Through case studies and practical applications, students learn to formulate effective strategies that align with both global opportunities and local realities.
Recommended Textbook
International Business 7th Edition by
Ricky W. Griffin
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19 Chapters
2470 Verified Questions
2470 Flashcards
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Page 2
Chapter 1: An Overview of International Business
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Sample Questions
Q1) Walt Disney permits a German clothing manufacturer to market children's pajamas embroidered with Mickey Mouse in return for a percentage of company sales. This is an example of ________.
A) franchising
B) licensing
C) leasing
D) piracy
Answer: B
Q2) The primary benefit of worldwide partnership is the right to use the Olympic logo on all advertising by the sponsor.
A)True
B)False
Answer: False
Q3) The home country is where a foreign firm operates.
A)True
B)False
Answer: False
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Page 3
Chapter 2: Global Marketplaces and Business Centers
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Sample Questions
Q1) Which country has the highest per capita income in North America?
A) the United States
B) Central America
C) Canada
D) Mexico
Answer: A
Q2) What are import and export substitution policies? How have these policies affected Asian and South American markets?
Answer: Countries using import substitution policies attempt to stimulate the development of local industry by discouraging imports via high tariffs and nontariff barriers. The opposite of import substitution is export promotion, whereby a country pursues economic growth by expanding its exports. This is the developmental approach successfully adopted by Taiwan, Hong Kong, and Singapore. However, many major South American countries adopted these well-intentioned but destructive import substitution policies. For most South American industries, however, the domestic market is too small to enable domestic producers to gain economies of scale through mass-production techniques or to permit much competition among local producers. Thus, prices of domestically produced goods tend to rise above prices in other markets. The result is inflation and destruction of middle class savings.
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Chapter 3: Legal, Technological, Accounting, and Political Environments
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Sample Questions
Q1) Which of the following questions is LEAST relevant when resolving an international business dispute?
A) Which country's law applies?
B) Where should the issue be resolved?
C) How long should litigation occur?
D) How will the settlement be enforced?
Answer: C
Q2) ________ is the risk associated with the potential for the firm's property to be confiscated or expropriated.
A) Transfer risk
B) Ownership risk
C) Operating risk
D) Exchange rate risk
Answer: B
Q3) Macropolitical risks affect all firms in a country, while micropolitical risks affect only specific industries or specific firms.
A)True
B)False
Answer: True
Page 5
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Chapter 4: The Role of Culture
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Sample Questions
Q1) In a high-context culture, the presence of a lawyer during business dealing would be considered a sign of ________.
A) wisdom
B) trust
C) distrust
D) pragmatism
E) commitment
Q2) In which country would an employee most likely question the decision of a manager?
A) Spain
B) Japan
C) Germany
D) Singapore
Q3) What is the difference between social structure and social stratification? How do these elements affect international business?
Q4) How does religion affect international business practices and marketing programs?
Q5) Identify five forms of nonverbal communication. Why are nonverbal forms of communication important in international business?
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Chapter 5: Ethics and Social Responsibility in International Business
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Sample Questions
Q1) An MNE with a factory in Cambodia is being inspected by the International Labor Organization. What is the most likely focus of the inspection?
A) excessive corruption
B) customs procedures
C) environmental violations
D) safe working conditions
Q2) Accepting gifts in a business relationship is unethical behavior in any country.
A)True
B)False
Q3) Merck Pharmaceuticals has exhibited philanthropy by providing free medication to individuals in developing countries for the treatment of river blindness.
A)True
B)False
Q4) Which of the following actions LEAST likely shows a firm's social responsibility toward its customers?
A) giving fair treatment
B) charging fair prices
C) providing warranties
D) meeting delivery commitments
Page 7
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Chapter 6: International Trade and Investment
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Sample Questions
Q1) The country similarity theory argues that most trade in manufactured goods should be between countries with similar per capita incomes.
A)True
B)False
Q2) Ellis, a manager at an MNE, is studying international trade theories. In his current position, Ellis would most likely use this knowledge to ________.
A) lobby for trade policy changes
B) identify promising new markets
C) predict factors that motivate trade
D) analyze foreign exchange markets
Q3) Why does Heineken rely on FDI for much of its internationalization strategy?
Q4) How can firms develop a sustainable competitive advantage?
Q5) Dunning suggests that FDI will occur when there is an ownership advantage, a location advantage, and an internalization advantage.
A)True
B)False
Q6) Why is the notion of specialization important when analyzing the benefits of free trade?
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Chapter 7: The International Monetary System and the Balance of Payments
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Sample Questions
Q1) The balance of payments accounting system is a double entry system.
A)True
B)False
Q2) The World Bank and the International Monetary Fund were created as part of the
A) Jamaica Accord
B) Louvre Accord
C) Plaza Agreement
D) Bretton Woods Agreement
Q3) Under Bretton Woods, the euro became the vehicle of choice for settling most international transactions.
A)True
B)False
Q4) Dell Computers invests excess cash balances overnight in a London bank to earn a higher interest rate than it could earn in a New York bank. Dell is most likely making a(n)
A) international currency investment
B) short-term portfolio investment
C) long-term portfolio investment
D) foreign direct investment
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Chapter 8: Foreign Exchange and International Financial Markets
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Sample Questions
Q1) The price of foreign exchange is set by ________.
A) the international monetary fund
B) the gold standard
C) demand and supply in the marketplace
D) administrators of the World Bank
Q2) The ________ consists of foreign-exchange transactions that are to occur sometime in the future.
A) soft currency market
B) spot market
C) hard currency market
D) forward market
Q3) Tyler, a U.S. citizen, received a quote on the dollar/yen relationship of ¥108.21/$1. Tyler most likely received a(n) ________ quote.
A) indirect
B) direct
C) yen
D) dollar
Q4) The Eurocurrency market is limited to exchanges that include the euro.
A)True
B)False
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Chapter 9: Formulation of National Trade Policies
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Sample Questions
Q1) ________ can occur when a firm sells its goods in a foreign market at a price below what it charges in its home market.
A) Predatory pricing
B) International price discrimination
C) Foreign trade duties
D) Subsidies
Q2) What is the primary difference between fair trade and free trade? Which do you think is more appropriate for the U.S.? Why?
Q3) Which of the following tariffs is not an import tariff?
A) transit tariff
B) ad valorem tariff
C) specific tariff
D) compound tariff
Q4) ________ implies that the national government exerts minimal influence on the exporting and importing decisions of private firms and individuals.
A) Fair trade
B) Free trade
C) Managed trade
D) Equitable trade
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Chapter 10: International Cooperation Among Nations
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Sample Questions
Q1) What is the most important characteristic of regional trading blocs?
Q2) Which Canadian firm would most likely NOT be protected in Canada in accordance with NAFTA provisions?
A) Atwater Publishing Company
B) Barton Film Productions
C) Compton TV Studios
D) Dawson Energy
Q3) In which industry is the inadequate enforcement of laws prohibiting illegal usage, copying, or counterfeiting of intellectual property LEAST likely a problem?
A) fashion textiles
B) filmed entertainment
C) computer software
D) pharmaceuticals
Q4) Mexico has trade agreements with all of the following countries except ________.
A) Japan
B) Chile
C) Israel
D) India
Q5) What are the four organizations that govern the EU?
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Chapter 11: International Strategic Management
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Sample Questions
Q1) International operations strategy deals with the creation of the firm's products or services.
A)True
B)False
Q2) Kraft Foods is more concerned with meeting the specific needs of local customers than with reducing manufacturing costs. Which strategy is most likely used by Kraft Foods?
A) home replication strategy
B) transnational strategy
C) global strategy
D) multidomestic strategy
Q3) What activities are involved in the strategy formulation and strategy implementation stages?
Q4) ________ may be defined in terms of geographic regions, markets, or product niches.
A) Distinctive competence
B) Scope of operations
C) Resource deployment
D) Synergy
Q5) When is a global strategy most appropriate?
Page 13
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Chapter 12: Strategies for Analyzing and Entering Foreign Markets
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Sample Questions
Q1) Which of the following is not a disadvantage of exporting?
A) vulnerability to tariffs
B) logistical complexities
C) potential conflicts with distributors
D) restrictions on foreign investment
Q2) Burger King has established a franchise agreement with an individual in Tokyo. Burger King will most likely provide the Japanese franchisee with all of the following EXCEPT ________.
A) intellectual property
B) operating systems
C) financial capital
D) training
Q3) ________ refer to expenses incurred by the firm as it enters a new foreign market.
A) Indirect costs
B) Direct costs
C) Opportunity costs
D) Variable costs
Q4) Why are international turnkey projects usually administered by large construction firms?
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Chapter 13: International Strategic Alliances
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Sample Questions
Q1) Public-private ventures are most important in market-driven economies.
A)True
B)False
Q2) What is a public-private venture?
Q3) Under which management form are managers less accountable to managers in the partner firms?
A) shared management agreement
B) assigned arrangement
C) delegated arrangement
D) consensual arrangement
Q4) Feldman Insurance wants to enter the Brazilian market but is concerned about hostile government regulations in Brazil. Which of the following would most likely help Feldman overcome this problem?
A) forming a joint venture with a local firm
B) identifying the potential market share
C) hiring only local employees
D) appealing to the WTO
Q5) Why did Boeing establish a strategic alliance with several Japanese partners to help develop its 777 jet? What was the scope of the alliance?
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Chapter 14: International Organization Design and Control
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Sample Questions
Q1) Employees of Disneyland Paris felt the company was exercising overcontrol by applying the same grooming standards in Europe as in the United States.
A)True
B)False
Q2) Informal management networks are typically powerless when it comes to short-circuiting bureaucracy.
A)True
B)False
Q3) Sarita, a manager at a large international firm, is primarily responsible for the financial resources of the entire organization. Sarita is most likely the firm's ________.
A) chief financial officer
B) auditor
C) controller
D) vice president of financial affairs
Q4) Participation is a common technique used by firms to overcome employee resistance to control systems.
A)True
B)False
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Page 16
Chapter 15: Leadership and Employee Behavior in International Business
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Sample Questions
Q1) Why did the joint venture between IBM, Siemens, and Toshiba initially struggle?
A) stress among expatriate managers
B) insufficient facilities for production
C) unclear managerial roles and expectations
D) cultural differences between team members
Q2) After significant testing, researchers have concluded that expectancy theory applies both in the United States and in other countries.
A)True
B)False
Q3) According to research, managers in ________ have the highest tendency to believe that they should be experts and should know the answers to all questions raised by subordinates.
A) Italy
B) Japan
C) Germany
D) Great Britain
Q4) Self-efficacy indicates a person's abilities to perform a task.
A)True
B)False
Q5) Explain the difference between needs and values.
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Chapter 16: International Marketing
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Sample Questions
Q1) Why are synergies and coordination important in international marketing?
Q2) Which term best describes the market pricing policy?
A) simple
B) integrated
C) complex
D) standardized
Q3) Executives at Dawson Manufacturing, an MNE, are considering the implementation of a market pricing policy. Which of the following is NOT a potential risk to Dawson of this type of policy?
A) inability to assess marginal costs
B) damage to the firm's brand name
C) development of a gray market
D) complaints about dumping
Q4) Standardization allows the firm to develop cost efficiencies in manufacturing, distribution, and promotion while customization allows a firm to tailor the marketing mix to meet customer needs.
A)True
B)False
Q5) What are the three factors firms must consider as they develop an advertising strategy?
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Chapter 17: International Operations Management
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Sample Questions
Q1) What is statistical process control?
Q2) Why do most personal computer manufacturers purchase components from outside suppliers?
A) protection of intellectual property rights
B) fast rate of technological change
C) close oversight of quality ratios
D) fluctuation in currency rates
Q3) The suppliers used by Morrison Controls deliver components directly to Morrison's manufacturing center as the inputs are needed for production to minimize Morrison's inventory costs. Morrison most likely uses ________.
A) one-stop shipping
B) just-in-time systems
C) materials management
D) customized logistics processes
Q4) The importance of information management depends on the type of strategy and organization design the firm uses.
A)True
B)False
Q5) Describe the three areas in which operations managers make decisions.
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Chapter 18: International Financial Management
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Sample Questions
Q1) What is a swap market? How can swap markets help international firms obtain low-cost sources of capital and manage foreign exchange risk?
Q2) All of the following are internal sources of investment capital for international businesses EXCEPT ________.
A) adjusted transfer prices
B) operation profits
C) subsidiary loans
D) managed floats
Q3) An accepted time draft is called a ________.
A) sight draft
B) bill of lading
C) bill of exchange
D) trade acceptance
Q4) What role does the Export-Import Bank play in financing international trade?
Q5) What are the three corporate financial goals involved in managing working capital?
Q6) What are the two roles of the bill of lading?
Q7) What is economic exposure?
Q8) How does a time draft become a banker's acceptance?
Page 20
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Chapter 19: International Human Resource Management and Labor Relations
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Sample Questions
Q1) A manager based in New York who is given a foreign assignment in Tokyo would most likely receive a significant cost-of-living allowance.
A)True
B)False
Q2) What kinds of skills and abilities are necessary to work in a foreign location?
Q3) The ability of the family to adapt plays a relatively minor role in expatriate failure.
A)True
B)False
Q4) Which of the following is a EU policy that promotes common job-related benefits and working conditions throughout the EU?
A) fixed alliance
B) social charter
C) statutory law
D) codetermination
Q5) How is a hardship premium used?
Q6) In many European nations, labor unions are aligned with political parties.
A)True
B)False
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