Test Bank For
International Business A Managerial Perspective, Global Edition, 9th edition Ricky W. Griffin
Michael Pustay
Chapters 1-19
Chapter 1 An Overview of International Business
1) Which of the following would be considered an international business transaction?
A) purchasing products in one country and assembling them in the same country
B) recruiting employees internationally
C) borrowing money from a major bank to finance capital improvements
D) shipping finished products from one country to another for retail sale
Answer: D
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Analytical Thinking
2) Trade between nations can be traced back as far as ________.
A) 2000 BC
B) 500 BC
C) 1200
D) 1600
Answer: A
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
3) Which country was a significant focal point for international business during the Middle
Ages?
A) China
B) England
C) Italy
D) Russia
Answer: C
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
4) Which of the following is a primary source of revenue for FIFA World Cup?
A) television coverage
B) public donations
C) real estate sales
D) international loans
Answer: A
,Diff: 1
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
5) A boundary less economy is one in which ________.
A) exported goods are predominant
B) regional borders are significant
C) trade laws are strictly enforced
D) national borders are irrelevant
Answer: D
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
6) Business transactions between parties from more than one country are known as international
business.
Answer: TRUE
Diff: 1
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
7) International business is more complex than domestic business.
Answer: TRUE
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
8) Small businesses are usually not involved in international business given the cost restrictions.
Answer: FALSE
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
9) The growth of FDI and MNCs first started during the American colonial period.
Answer: TRUE
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
,10) How is FIFA World Cup symbolic of international business?
Answer: FIFA World Cup reflects an intense version of international business. Cities compete
with each other to host the games because hosting it brings recognition and publicity to the city
just as it does to a company brand name. In addition, the city benefits from increased travel,
tourism, and investment by businesses supporting the games.
Diff: 3
Skill: Critical Thinking
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
11) How does international business differ from domestic business? Why is it important for
business students to learn about international business?
Answer: Domestic business involves transactions that occur within a single country, while
international business involves transactions that cross national borders. Students should learn
about IB because most large firms have global operations and many small firms are expanding
into the international arena.
Diff: 3
Skill: Synthesis
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
12) International business differs from domestic business in several ways. Identify at least three
of these differences and describe their implications for companies.
Answer: The countries involved may use different currencies, requiring currency conversion and
introducing exchange rate risk. Because the legal systems are different, one or more parties must
adjust their practices to comply with local laws. Cultural differences and the availability of
resources affects production of various items and production methods.
Diff: 3
Skill: Synthesis
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
13) The Internet has helped small businesses compete in global markets because it ________.
A) allows them to establish a physical presence in each country
B) avoids transactions involving foreign exchange
C) eliminates price controls
D) reduces entry costs
Answer: D
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
, 14) According to the CAGE Model, which of the following refers to the physical,
communications, and transportation links between countries?
A) cultural distance
B) administrative distance
C) geographic distance
D) economic distance
Answer: C
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
15) Individuals should most likely study international business to ________.
A) comply with graduate school certification requirements
B) ensure that an employer has a global online presence
C) remain current on the latest business methods
D) obtain bilingual business experience
Answer: C
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
16) Which of the following has most likely triggered the increase of small businesses involved in
international business?
A) e-commerce
B) economic recession
C) foreign-made materials
D) increased cultural literacy
Answer: A
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
17) Just-in-time systems were created in ________.
A) the United States
B) Japan
C) Germany
D) China
Answer: B
Diff: 1
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
International Business A Managerial Perspective, Global Edition, 9th edition Ricky W. Griffin
Michael Pustay
Chapters 1-19
Chapter 1 An Overview of International Business
1) Which of the following would be considered an international business transaction?
A) purchasing products in one country and assembling them in the same country
B) recruiting employees internationally
C) borrowing money from a major bank to finance capital improvements
D) shipping finished products from one country to another for retail sale
Answer: D
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Analytical Thinking
2) Trade between nations can be traced back as far as ________.
A) 2000 BC
B) 500 BC
C) 1200
D) 1600
Answer: A
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
3) Which country was a significant focal point for international business during the Middle
Ages?
A) China
B) England
C) Italy
D) Russia
Answer: C
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
4) Which of the following is a primary source of revenue for FIFA World Cup?
A) television coverage
B) public donations
C) real estate sales
D) international loans
Answer: A
,Diff: 1
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
5) A boundary less economy is one in which ________.
A) exported goods are predominant
B) regional borders are significant
C) trade laws are strictly enforced
D) national borders are irrelevant
Answer: D
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
6) Business transactions between parties from more than one country are known as international
business.
Answer: TRUE
Diff: 1
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
7) International business is more complex than domestic business.
Answer: TRUE
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
8) Small businesses are usually not involved in international business given the cost restrictions.
Answer: FALSE
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
9) The growth of FDI and MNCs first started during the American colonial period.
Answer: TRUE
Diff: 2
Skill: Concept
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
,10) How is FIFA World Cup symbolic of international business?
Answer: FIFA World Cup reflects an intense version of international business. Cities compete
with each other to host the games because hosting it brings recognition and publicity to the city
just as it does to a company brand name. In addition, the city benefits from increased travel,
tourism, and investment by businesses supporting the games.
Diff: 3
Skill: Critical Thinking
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
11) How does international business differ from domestic business? Why is it important for
business students to learn about international business?
Answer: Domestic business involves transactions that occur within a single country, while
international business involves transactions that cross national borders. Students should learn
about IB because most large firms have global operations and many small firms are expanding
into the international arena.
Diff: 3
Skill: Synthesis
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
12) International business differs from domestic business in several ways. Identify at least three
of these differences and describe their implications for companies.
Answer: The countries involved may use different currencies, requiring currency conversion and
introducing exchange rate risk. Because the legal systems are different, one or more parties must
adjust their practices to comply with local laws. Cultural differences and the availability of
resources affects production of various items and production methods.
Diff: 3
Skill: Synthesis
LO: 1.1: Discuss the meaning of international business.
AACSB: Application of Knowledge
13) The Internet has helped small businesses compete in global markets because it ________.
A) allows them to establish a physical presence in each country
B) avoids transactions involving foreign exchange
C) eliminates price controls
D) reduces entry costs
Answer: D
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
, 14) According to the CAGE Model, which of the following refers to the physical,
communications, and transportation links between countries?
A) cultural distance
B) administrative distance
C) geographic distance
D) economic distance
Answer: C
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
15) Individuals should most likely study international business to ________.
A) comply with graduate school certification requirements
B) ensure that an employer has a global online presence
C) remain current on the latest business methods
D) obtain bilingual business experience
Answer: C
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
16) Which of the following has most likely triggered the increase of small businesses involved in
international business?
A) e-commerce
B) economic recession
C) foreign-made materials
D) increased cultural literacy
Answer: A
Diff: 2
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
17) Just-in-time systems were created in ________.
A) the United States
B) Japan
C) Germany
D) China
Answer: B
Diff: 1
Skill: Concept
LO: 1.2: Explain the importance of understanding international business.
AACSB: Application of Knowledge
