International Business Strategy
Review Questions
Course Introduction
International Business Strategy explores the frameworks and practices that organizations use to compete and succeed in the global marketplace. The course examines the challenges and opportunities of operating across diverse economic, cultural, and regulatory environments. Students will analyze strategic decision-making in areas such as market entry, global competition, international alliances, and adaptation of products and services to different markets. The curriculum emphasizes both theoretical foundations and practical applications, using case studies to illustrate how multinational corporations develop and implement effective global strategies while navigating risks and leveraging cross-border advantages.
Recommended Textbook
Strategic Management 4th Edition by Frank Rothaermel
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12 Chapters
1217 Verified Questions
1217 Flashcards
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Page 2
Chapter 1: What Is Strategy
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Sample Questions
Q1) Core values provide ethical guidelines for how individual employees will behave.
A)True
B)False
Answer: True
Q2) If a company wants to gain a competitive advantage in a highly competitive industry, it should ideally
A) execute an integrated cost-leadership and differentiation position.
B) copy the strategies of other firms through competitive benchmarking.
C) provide goods or services similar to its competitors at higher prices.
D) stake out a unique position within the industry.
Answer: D
Q3) Questions asked during the strategy analysis stage of the AFI framework include "How does the firm make money?" and "What effects do forces in the external environment have on the firm's potential to gain and sustain a competitive advantage?"
A)True
B)False
Answer: True
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Chapter 2: Strategic Leadership: Managing the Strategy Process
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101 Verified Questions
101 Flashcards
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Sample Questions
Q1) It is helpful to break down strategy formulation and strategy implementation into five distinct areas.
A)True
B)False
Answer: False
Q2) Ida has been tasked with formulating the business strategy for Contour Cosmetics' new line of lipsticks. Which of the following ideas would Ida be likely to include in her proposal?
A) Open kiosks in shopping centers located in developing countries with rising disposable incomes.
B) Promote the lipsticks as the longest-lasting on the market.
C) Invest in building an online store for Contour products.
D) Reorganize the manufacturing division to gain efficiency.
Answer: B
Q3) An employee lacking some of the innate abilities to be a top-level manager can still become an effective strategic leader through hard work and experience.
A)True
B)False
Answer: True
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Chapter 3: External Analysis: Industry Structure,
Competitive Forces, and Strategic Groups
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Sample Questions
Q1) Companies in the same strategic group are ________ to each other.
A) strategic allies
B) direct competitors
C) merger partners
D) stakeholders or shareholders
Answer: B
Q2) How do scholars explain differences in firm performance within the same industry?
Answer: To explain differences in firm performance within the same industry, scholars offer the strategic group model, which clusters different firms into groups based on a few key strategic dimensions. They find that even within the same industry, firm performances differ depending on strategic group membership. Some strategic groups tend to be more profitable than others. This difference implies that firm performance is determined not only by the industry to which the firm belongs, but also by its strategic group membership. The distinct differences across strategic groups reflect the business strategies that firms pursue. Firms in the same strategic group tend to follow a similar strategy. Companies in the same strategic group, therefore, are direct competitors.
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Chapter 4: Internal Analysis: Resources, Capabilities, and Core Competencies
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Sample Questions
Q1) Tony's Pizza has been trying to directly copy the strategies of Moonlight Pies. Even though it is evident that the success of Moonlight Pies' success comes from the freshness and variety of ingredients it uses, Tony's Pizza has not been able to introduce the same types of produce into its recipes. This is because Moonlight's network of relationships with local growers, as well as its efficient supply chain, are very difficult to emulate. Which of the following barriers to imitation does this scenario best illustrate?
A) path dependence
B) social complexity
C) resource mobility
D) resource homogeneity
Q2) Which of the following describes a situation in which firms acquire resources at a low cost, laying the foundation for a competitive advantage later?
A) better expectations of future resource value
B) path dependence affecting current decisions
C) causal ambiguity
D) social complexity
Q3) Explain how the activities of a firm help in achieving a competitive advantage.
Q4) How do managers benefit from conducting a SWOT analysis?
Page 6
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Chapter 5: Competitive Advantage, Firm Performance, and Business Models
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Sample Questions
Q1) A firm will always see its stock price appreciate when it demonstrates measurable growth.
A)True
B)False
Q2) The ratio of SG&A/Revenue is an indicator of a firm's focus on
A) researching to produce innovative products and services.
B) marketing and sales to promote its products and services.
C) producing a good in an efficient manner.
D) creating a good that is cost-effective.
Q3) What are the three financial ratios that constitute return on revenue, and what do they tell us?
Q4) Threadless allows customers to submit their own designs and to vote on which designs they would like to see printed on a T-shirt. This business uses a ________ technique.
A) offshoring
B) crowdsourcing
C) peer-to-peer
D) binge watching
Page 7
Q5) How does the triple-bottom line approach help managers? Explain with the help of an example.
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Chapter 6: Business Strategy: Differentiation, Cost
Leadership, and Blue Oceans
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Sample Questions
Q1) DiscountHaven Inc. is a large chain of hypermarkets. It has cost benefits due to its extensive operation. The company's marketing and sales, logistics, administrative, and other such related costs get divided between a large number of product units stocked in its stores. This makes it difficult for smaller retail stores and supermarkets to compete against DiscountHaven's low prices. Thus, DiscountHaven has a competitive advantage due to its
A) superior customer service.
B) time compression economies.
C) economies of scale.
D) learning-curve effects.
Q2) Due to its large sales volume and low cost structure, Quick Serve Mini-Marts enjoys a cost leadership position. Which of the following scenarios might threaten Quick Serve's competitive advantage?
A) Existing competitors in the mini-mart industry lower their prices to match those of Quick Serve.
B) Industry suppliers raise their prices.
C) Competitors engage in an all-out price war.
D) A new competitor is perceived to provide similar value, but in addition offers innovative self-checkout.
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Chapter 7: Business Strategy: Innovation, Entrepreneurship, and Platforms
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Sample Questions
Q1) A new product often has a high price when it is launched because of a
A) large investment in designing a product while producing small quantities.
B) large investment in marketing a product while producing small quantities.
C) large investment in designing a product while producing large quantities.
D) large investment in marketing a product while producing large quantities.
Q2) Which of the following scenarios best exemplifies a platform business?
A) Devin purchases electronic parts from a variety of vendors and assembles them into inexpensive MP3 players that he sells to consumers.
B) Myra operates an industrial test kitchen in which local growers bring their produce to local chefs, who use the kitchen to try new recipes and determine which produce to buy.
C) Raul operates a consulting firm in which businesses hire him to assess deficiencies in their organizational culture.
D) Gena founded a bike-based transportation company that offers environmentally-friendly rides to customers within a 25-mile radius.
Q3) The pace of innovation has slowed in the 21st century.
A)True
B)False
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Page 9
Chapter 8: Corporate Strategy: Vertical Integration and Diversification
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Sample Questions
Q1) Which of the following is a drawback of vertical integration?
A) It increases the difficulty of securing critical supplies.
B) It impedes scheduling and planning.
C) It increases the potential of legal repercussions.
D) It impedes investments in special assets.
Q2) Beagle Autos is known for its affordable and reliable brand of consumer vehicles. Because its shareholders expect to see an improved rate of growth in the coming years, Beagle's executives have decided to diversify the company's range of products so that at least 40 percent of the firm's revenue is generated by new business units. However, the company's resources, capabilities, and competencies are limited to producing other forms of motorized vehicles, such as motorcycles and all-terrain vehicles (ATVs). Which type of corporate diversification strategy should Beagle pursue?
A) dominant business
B) related-constrained
C) related-linked
D) unrelated
Q3) What is a conglomerate? How does it benefit from a diversification strategy?
Q4) Why are generic industry value chains called vertical value chains?
Q5) What must executives decide when formulating a corporate strategy?
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Chapter 9: Corporate Strategy: Strategic Alliances, Mergers, and Acquisitions
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Sample Questions
Q1) Which of the following statements is true about managing alliance-related tasks?
A) Forming an alliance with another firm prohibits that firm from forming other alliances.
B) Alliance management capability is based on three alliance-related tasks.
C) A merger is one of the three options for alliance design and governance.
D) In post-formation alliance management, none of the firms in an alliance is permitted to gain a competitive advantage.
Q2) Which of the following is an advantage of equity alliances when compared to non-equity alliances?
A) They are more flexible and easy to initiate and terminate.
B) They require smaller capital investments.
C) They produce stronger ties between partners.
D) They are based on contracts rather than ownership.
Q3) What is meant by managerial hubris? In what forms does it appear?
Q4) Which of the following is a common drawback of a non-equity alliance?
A) lack of trust between partners
B) difficulty initiating the contract
C) difficulty terminating the contract
D) lack of flexibility for the partners
Q5) Describe an equity alliance with the help of an example.
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Chapter 10: Global Strategy: Competing Around the World
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Sample Questions
Q1) What is the engine behind globalization? Provide a real-world example.
Q2) Businesses located in countries that have relatively weak domestic demand rarely make the leap to multinational enterprises because they must focus their attention on shoring up their economic positions in their home countries.
A)True
B)False
Q3) Myriad Inc., a well-established and reputed multinational enterprise (MNE), is headquartered in a highly developed economy. It wants to start its operations in New Denistan, considered one of the less-developed nations in the world. How will this strategic move most likely affect Myriad Inc.?
A) It will benefit from economic arbitrage.
B) Myriad will use its competitive advantage from economies of standardization.
C) Myriad will replicate its existing business model easily.
D) It will be able to easily sell products for which demand varies by income.
Q4) What are the two opposing forces that multinational companies have to face when competing around the globe?
Q5) Discuss how demand conditions within Porter's diamond framework affect national competitive advantage.
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Chapter 11: Organizational Design: Structure, Culture, and Control
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Sample Questions
Q1) Uptown Office Systems recently underwent a reorganization. Based on customer feedback, the company eliminated many of its middle management positions and implemented a flatter structure. Which of the following is a possible drawback of this decision?
A) Employees will have less power and autonomy, resulting in a loss of morale.
B) Internal communications and decision-making processes will be slower.
C) The increased span of control for remaining managers may lead to higher levels of stress and possible burnout.
D) Employees will be forced to take on more specialized roles and may become bored by repetitive tasks.
Q2) Which of the following statements is true of strategy in an organization?
A) Strategy implementation is considered unsuccessful if it requires changes within an organization.
B) To implement a strategy successfully, an organization's structure must be rigid.
C) Strategy implementation does not affect resource allocation and power distribution within an organization.
D) Organizational structure must follow strategy in order for firms to achieve superior performance.
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Page 13
Chapter 12: Corporate Governance and Business Ethics
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Sample Questions
Q1) A bank, CQC, offers a customer a personal loan. In which of the following circumstances will this decision most likely be considered unethical?
A) The bank knows that the customer will be unable to pay the loan if the interest rate rises.
B) The bank is not aware of the investments made by the customer.
C) The bank has the financial statements of the customer, but it is not aware of each source of income.
D) The bank is depending on the customer to pay back the loan before term completion.
Q2) Rajat Gupta's role in providing inside information to Galleon Group for the benefit of Galleon Group's stockholders and himself is an example of A) shareholder capitalism.
B) adverse selection.
C) shared value creation.
D) moral hazard.
Q3) Describe moral hazard in the context of the principal-agent relationship. Use an example.
Q4) How does a leveraged buyout affect a public company?
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