BUS 381 Exam 3 Questions with CORRECT
Answers
International Strategy
Selling the same products or services in domestic and foreign markets; low cost pressure, low
local responsiveness
Why Firms Go Global
To access resources, technology, mature markets, lower-cost inputs, new markets, and develop
new competencies
Advantages of International Expansion
Access to new markets, lower-cost inputs, and developing new capabilities.
Disadvantages of International Expansion
Liability of foreignness, loss of reputation, and loss of intellectual property.
CAGE Framework
A tool for assessing costs/risks of international expansion (Cultural, Administrative/Political,
Geographic, Economic).
Cultural Distance
Differences in social norms, values, beliefs, and behavioral expectations between home and host
countries.
Dimensions of Cultural Distance
, Power distance, individualism, masculinity/femininity, uncertainty avoidance, long-term
orientation, indulgence.
Power Distance
Comfort with hierarchy and unequal distribution of power.
Individualism
Degree of interdependence among people in a society.
Masculinity vs. Femininity
Masculinity = outcome achievement; Femininity = quality of life/enjoying what you do.
Uncertainty Avoidance
Comfort level with unpredictability and ambiguity.
Long-Term Orientation
How cultures view time (past, present, future).
Indulgence
Extent to which people control desires vs. indulge in them.
Administrative & Political Distance
Differences in laws, regulations, politics, currency systems, and institutions.
Barriers to Administrative/Political Distance
Tariffs, quotas, and trade restrictions.
Geographic Distance
Answers
International Strategy
Selling the same products or services in domestic and foreign markets; low cost pressure, low
local responsiveness
Why Firms Go Global
To access resources, technology, mature markets, lower-cost inputs, new markets, and develop
new competencies
Advantages of International Expansion
Access to new markets, lower-cost inputs, and developing new capabilities.
Disadvantages of International Expansion
Liability of foreignness, loss of reputation, and loss of intellectual property.
CAGE Framework
A tool for assessing costs/risks of international expansion (Cultural, Administrative/Political,
Geographic, Economic).
Cultural Distance
Differences in social norms, values, beliefs, and behavioral expectations between home and host
countries.
Dimensions of Cultural Distance
, Power distance, individualism, masculinity/femininity, uncertainty avoidance, long-term
orientation, indulgence.
Power Distance
Comfort with hierarchy and unequal distribution of power.
Individualism
Degree of interdependence among people in a society.
Masculinity vs. Femininity
Masculinity = outcome achievement; Femininity = quality of life/enjoying what you do.
Uncertainty Avoidance
Comfort level with unpredictability and ambiguity.
Long-Term Orientation
How cultures view time (past, present, future).
Indulgence
Extent to which people control desires vs. indulge in them.
Administrative & Political Distance
Differences in laws, regulations, politics, currency systems, and institutions.
Barriers to Administrative/Political Distance
Tariffs, quotas, and trade restrictions.
Geographic Distance
