International Marketing Test Bank
Course Introduction
International Marketing explores the strategies and practices involved in marketing goods and services across national boundaries. This course examines global market environments, cultural influences, international market entry strategies, and the development of marketing mixes tailored to diverse consumer bases. Students will learn to conduct cross-cultural analysis, manage global branding, adapt to regulatory frameworks, and respond to the challenges and opportunities of digital globalization. Emphasis is placed on real-world case studies, practical applications, and ethical considerations in global marketing activities.
Recommended Textbook
International Business The New Realities 3rd Edition by S. Tamer Cavusgil
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20 Chapters
1910 Verified Questions
1910 Flashcards
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Page 2
Chapter 1: Introduction: What Is International Business
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Sample Questions
Q1) Phillip Hardy, one of the potential investors, expresses the desire to purchase only those types of assets in which he can maintain a relatively short-term interest. Which of the following investment opportunities would be most suited for Mr. Hardy?
A) a venture that gives investors ownership of the equipment used by multiple South African mining companies
B) an initiative to purchase the technology assets of an Indian consulting firm
C) the Freehold Eastern Growth Fund, which purchases Eastern European growth stocks
D) the Freehold World Climb Project, which maintains partial ownership of an Australian hiking equipment production plant
Answer: C
Q2) International business is also known as which of the following?
A) born global business
B) laissez-faire business
C) cross-border business
D) multi-hub business
Answer: C
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3
Chapter 2: Globalization of Markets and the
Internationalization of the Firm
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Sample Questions
Q1) ________ refers to the tendency of a financial or monetary crisis in one country to spread rapidly to other countries, due to the ongoing integration of national economies.
A) Contagion
B) Nationalization
C) Internationalization
D) Codetermination
Answer: A
Q2) As market globalization intensifies, ________.
A) the gap between the rich and the poor shrinks rapidly
B) the distance between consumers worldwide expands
C) individual firms respond to the challenges and new advantages that it brings
D) firms internationalize solely as a reaction to it
Answer: C
Q3) Which of the following is an example of a supranational institution?
A) the World Intellectual Property Organization
B) the UNICEF
C) the Red Cross
D) the World Trade Organization
Answer: D
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Chapter 3: Organizational Participants That Make International Business Happen
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Sample Questions
Q1) An increasingly popular type of turnkey contract in the developing economies is the ________, in which the contractors acquire an ownership stake in the facility for a period of time until it is turned over to the client.
A) international collaborative venture
B) build-own-transfer venture
C) joint venture
D) project-based, nonequity venture
Answer: B
Q2) Peter, a graduate student from Michigan, ordered a notebook from Opus Inc., an American MNC manufacturing and selling computers and related products. The notebook that Peter ordered from Michigan was assembled in Opus' factory in Taipei. This exemplifies the ________ stage in the international value chain.
A) research and development
B) sourcing
C) production
D) after-sales service
Answer: C
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Page 5
Chapter 4: The Cultural Environment of International Business
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Sample Questions
Q1) Technological advances are a key determinant of culture and cultural change.
A)True
B)False
Q2) In companies with decentralized organizational structure, power is concentrated at the regional or corporate headquarters.
A)True
B)False
Q3) Which of the following refers to the extent to which people can tolerate risk in their lives?
A) uncertainty avoidance
B) long-term versus short-term orientation
C) power distance
D) individualism
Q4) Which of the following countries exhibit a high-context culture?
A) Japan
B) Germany
C) The United States of America
D) Switzerland
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Chapter 5: Ethics and International Business
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Sample Questions
Q1) Easy accessibility of the Internet has led to a perceptible decline in deceptive marketing.
A)True
B)False
Q2) In a short essay, describe the three types of interests simultaneously pursued by a sustainable business.
Q3) Firms with strong environmental interests are most likely to ________.
A) provide employees educational opportunities
B) encourage the use of sweatshops
C) optimize diversity in hiring
D) minimize pollutants in manufacturing
Q4) ________ refers to ideas or works created by individuals or firms and includes a variety of proprietary, intangible assets: discoveries and inventions; artistic, musical, and literary works; and words, phrases, symbols, and designs.
A) Global sourcing
B) Corporate governance
C) Constant capital
D) Intellectual property
Q5) In a short essay, explain the value of CSR for businesses.
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Chapter 6: Theories of International Trade and Investment
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Sample Questions
Q1) Which of the following is true with regard to competitive advantage?
A) Competitive advantages are typically derived from deliberate national policies.
B) A competitive advantage is difficult for competitors to imitate.
C) A competitive advantage is also known as a country-specific advantage.
D) Competitive advantage includes inherited resources, such as arable land.
Q2) According to the internationalization process model, internationalization takes place in incremental stages over a long time.
A)True
B)False
Q3) Which of the following is true about the first stage of evolution in the international product life cycle theory?
A) The product enjoys a temporary monopoly at this stage.
B) The product's inventors mass-produce it and seek to export it.
C) The knowledge about how to produce the product is widespread.
D) The competition intensifies at this stage and export orders begin to come from lower-income countries.
Q4) In a short essay, explain the absolute advantage principle. Provide an example of the principle at work.
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Page 8
Chapter 7: Political and Legal Systems in National Environments
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Sample Questions
Q1) Which of the following supports a decision in favor of Super Sports opening a store in Norway?
A) MNEs may transfer profits back to the home country without restriction.
B) The opening of warehouse-style stores requires the approval of local retailers.
C) Product injury cases generally rule in favor of plaintiffs regardless of evidence.
D) Advertising and marketing of particular products are banned under local distribution laws.
Q2) Expropriation is the term used to describe a host-country government seizing the assets of a foreign corporation and providing no compensation in return.
A)True
B)False
Q3) The immediate cause of country risk is a legal or political factor.
A)True
B)False
Q4) Describe country risk and discuss how political and legal systems contribute to country risk. Explain the differences between political systems and legal systems in your answer.
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Chapter 8: Government Intervention in International Business
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Sample Questions
Q1) How can government intervention in the form of subsidies be utilized to help low-income groups? Explain with suitable example.
Q2) Given the high trade barriers in Mexico, the management of NAC is most likely to consider ________ to be an inappropriate entry strategy.
A) exporting
B) FDI
C) joint ventures
D) licensing
Q3) Which of the following most supports abolishing the cotton quota over maintaining it?
A) The cotton growers have a competitive edge over foreign cotton growers, and they are profitable.
B) The fabric manufacturer, a prime contributor to the nation's annual revenue, can earn better returns by shifting to another country that does not impose cotton quotas.
C) A competing fabric manufacturer is considering opening a production facility in Zanzi.
D) The price of cotton fabric has remain unchanged over the last decade.
Q4) In a short essay, explain how the GATT changed international trade.
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Chapter 9: Regional Economic Integration
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Sample Questions
Q1) MERCOSUR, an economic bloc in Latin America, is an example of an economic union.
A)True
B)False
Q2) Which of the following has the longest experience with regional integration?
A) the United States of America
B) Asia
C) Europe
D) the Middle East
Q3) Regional integration greatly increases the scale of the marketplace for firms inside the economic bloc.
A)True
B)False
Q4) Which of the following has occurred as a result of NAFTA?
A) workers at maquiladoras have instigated union strikes
B) working conditions in member nations have improved
C) Canadian exports to Europe and Asia have doubled
D) foreign investors have been replaced by U.S. firms
Q5) Discuss the benefits of the worldwide trend toward regional economic integration, and briefly describe the five levels of economic integration.
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Chapter 10: Understanding Emerging Markets
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Sample Questions
Q1) Which of the following best summarizes the argument in favor of microfinance?
A) Microfinance ultimately leads to greater tax revenues for national governments.
B) Recently, mainstream banks have begun to view microfinance as the prime driver of advanced economies.
C) Microfinance allows the underprivileged to create businesses and improve their lives.
D) Microfinance alleviates the pressure on MNEs to support developing economies.
Q2) Africa's GDP has improved substantially since the 1960s.
A)True
B)False
Q3) Outsourcing enables foreign firms to increase efficiency by limiting corruption in the emerging markets.
A)True
B)False
Q4) Excessive bureaucracy is usually associated with ________.
A) strong legal framework
B) low country risk
C) lack of transparency
D) low trade barriers
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Page 12
Chapter 11: The International Monetary and Financial Environment
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Sample Questions
Q1) The most universally accepted currencies for international business transactions are the European euro, the U.S. dollar, and the Japanese yen, which are all considered hard currencies.
A)True
B)False
Q2) If an individual buys from a supplier whose currency is depreciating against the individual's currency, the individual will have to pay a larger amount of his own currency to complete the purchase.
A)True
B)False
Q3) Which of the following levels of the global monetary and financial systems pyramid includes commercial banks?
A) national government level
B) national infrastructure level
C) international organization level
D) firm level
Q4) Explain how a nation's economic growth is measured and what stimulates economic growth. What is the central bank, and how does it affect economic growth?
Page 13
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Chapter 12: Strategy and Organization in the International Firm
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Sample Questions
Q1) During the recent global financial crisis, efficiency and flexibility became particularly important to the success of multinational firms.
A)True
B)False
Q2) International division managers usually oversee ________.
A) large-scale investments
B) product development
C) distributor relationships
D) corporate accounting
Q3) A company can be compelled to be locally responsive in individual countries to provide uniform services to global customers.
A)True
B)False
Q4) Global integration is a plan of action that accounts for competition on a country-by-country basis.
A)True
B)False
Q5) What is the integration-responsiveness framework? Describe the two main components of the framework.
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Chapter 13: Global Market Opportunity Assessment
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Sample Questions
Q1) Products or services that are well-received at a firm's home country are more likely to be accepted in foreign countries as well.
A)True
B)False
Q2) When assessing the firm's readiness to internationalize, managers peer into their organization to determine the degree to which it has the resources necessary to successfully engage in international business.
A)True
B)False
Q3) Which of the following will be accomplished by potential exporters who are involved in studying import statistics?
A) evaluating the political risk of different markets
B) estimating the profitability of domestic sales
C) predicting the culture risk of an emerging market
D) assessing a market's viability for accepting new sales
Q4) Industry market potential is identical to company sales potential.
A)True
B)False
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Page 15
Chapter 14: Exporting and Countertrade
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Sample Questions
Q1) Which of the following should be considered first in making the decision to export OTC towels to Canada?
A) What is the probability of OTC and Earth Waves entering into a joint venture?
B) How much fluctuation occurs in the exchange rate between the Canadian dollar and the British pound?
C) What is the likelihood of Earth Waves opening a subsidiary in Canada?
D) What documentation would be required for OTC to export towels to Asia?
Q2) After managers have chosen an appropriate market for exporting, the next step is to ________.
A) decide about the resources to be committed
B) acquire the skills and competencies to handle export operations
C) engage appropriate international trade attorneys
D) modify advertising and promotional activities to suit individual markets
Q3) Buying products and services from foreign sources and bringing them into the home market is called ________.
A) exporting
B) global sourcing
C) global bartering
D) offshoring
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Page 16
Chapter 15: Foreign Direct Investment and Collaborative Ventures
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Sample Questions
Q1) International portfolio investment refers to passive ownership of foreign securities.
A)True
B)False
Q2) Which of the following should be considered in the decision regarding where to build a new Ciao plant?
A) How many Ciao cars are sold in Italy and Spain each year?
B) What U.S. automakers are the biggest competitors of Ciao?
C) How politically stable are the governments of Russia and Canada?
D) How will Ciao managers handle the language barriers in foreign markets?
Q3) A greenfield investment is a direct investment to purchase an existing company or facility.
A)True
B)False
Q4) Host-country governments often pressure MNEs to undertake acquisition over greenfield investments.
A)True
B)False
Q5) Discuss the four key differences between project-based, nonequity ventures and equity ventures.
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Chapter 16: Licensing, Franchising, and Other Contractual Strategies
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Sample Questions
Q1) ________ is an arrangement in which the focal firm or a consortium of firms plans, finances, organizes, manages, and implements all phases of a project abroad and then hands it over to a foreign customer after training local workers.
A) Home-replication strategy
B) Exporting
C) Turnkey contracting
D) Equity-based collaborative venture
Q2) Describe three advantages of licensing agreements from the perspective of the licensor.
Q3) Which of the following is protected under copyright laws?
A) the Nike swoosh
B) the art of Jackson Pollack
C) McDonald's clown shaped man with puffed out costume legs
D) Winnie the Pooh image
Q4) Contractual entry strategies in international business are cross-border exchanges in which the relationship between the focal firm and its foreign partner is governed by an explicit contract.
A)True
B)False
18
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Chapter 17: Global Sourcing
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Sample Questions
Q1) When outsourcing, managers can minimize the risk of creating employee tension by
A) increasing the number of junior managers for foreign assignments
B) increasing the annual training budget
C) sending domestic managers to foreign countries for training
D) reaching a consensus of managers and labor
Q2) In a short essay, explain how global sourcing can contribute significantly to a firm's ability to achieve its strategic goals. Why is "achievement of strategic goals" actually the best rationale for global sourcing?
Q3) ________ refers to sourcing from the firm's own production facilities.
A) Captive sourcing
B) Crowdsourcing
C) Business process outsourcing
D) Externalization
Q4) In advanced economies, firms generally do not outsource value-chain activities because they fear the loss of proprietary knowledge and trade secrets.
A)True
B)False
Q5) In a short essay, explain how global sourcing can affect home-country employees.
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Chapter 18: Marketing in the Global Firm
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Sample Questions
Q1) A standardized marketing approach is inappropriate when products have universal specifications.
A)True
B)False
Q2) What is market segmentation? In a short essay, discuss how international firms use market segmentation.
Q3) Serving a key global customer in a consistent and standardized manner, regardless of where in the world it operates is known as ________.
A) global account management
B) offshoring
C) marketing communications
D) insourcing
Q4) Channel length refers to the number of distributors or other intermediaries that it takes to get the product from the manufacturer to the market.
A)True
B)False
Q5) In a short essay, explain why consumers prefer global brands. What are some of the important characteristics of the most successful global brands?
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Chapter 19: Human Resource Management in the Global Firm
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Sample Questions
Q1) Critical incident analysis examines ________.
A) a situation under which an MNE is forced to relocate operations abroad
B) an episode in which tension arises between employee and foreign counterpart due to a cross-cultural misunderstanding
C) an episode in which tension arises between an employee and a manager with regard to performance evaluation
D) a critical situation in which the internal stakeholders of a firm fail to reach a consensus with regard to a common issue
Q2) Which of the following is NOT one of the four dimensions of cultural intelligence?
A) behavioral flexibility
B) motivation
C) strategy
D) introversion
Q3) In a short essay describe the four elements management must consider when compensating expatriates.
Q4) Discuss the reasons why labor union membership has declined in recent years.
Q5) In a short essay, discuss the factors that complicate the job of international human resource managers.
21
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Chapter 20: Financial Management and Accounting in the Global Firm
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Sample Questions
Q1) Which of the following questions would be more important for Intensity financial managers to evaluate when deciding the best method for the firm to raise funds?
A) What percentage of stock is owned by the CEO of Intensity Games?
B) How will the dividend be paid to shareholders if the firm expands its Chinese facility?
C) What type of debt financing would be most economical for Intensity?
D) At which bank does Intensity do the majority of its business transactions?
Q2) Explain the differences between equity financing and debt financing, and discuss the ways international firms obtain equity financing or debt financing.
Q3) Which of the following should most likely be considered by financial managers before FEG purchases Maple Leaf?
A) How will environmentalists react to the purchase of Maple Leaf by FEG?
B) Should FEG integrate the Maple Leaf logo into the FEG marketing campaign?
C) What is the best way for FEG to manage currency fluctuation between U.S. dollars and Canadian dollars?
D) How will NAFTA affect the legal negotiations between FEG and Maple Leaf?
Q4) Describe three methods used to transfer funds within an MNE.
Q5) How has technology affected foreign exchange trading?
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