IMS 3310 EXAM 1 ZYDOREK 2026/2027 | STUDY GUIDE, PRACTICE
QUESTIONS, ANSWERS & EXAM REVIEW
International business (IB) - ANS ✔✔(1) A business (firm) that engages in international (cross-border)
economic activities and/or (2) the action of doing business abroad
Multinational enterprise (MNE) - ANS ✔✔A firm that engages in foreign direct investment (FDI)
Foreign direct investment (FDI) - ANS ✔✔Investment in, controlling, and managing value-added activities
in other countries
Global business - ANS ✔✔Business around the globe
Global mindset - ANS ✔✔Ability to "connect the dots" globally
Expatriate manager (expat) - ANS ✔✔A manager who works abroad
International premium - ANS ✔✔A significant pay raise when working overseas
A Unified Framework - ANS ✔✔What is it that we do in global business?
It is about treating the global economy as your potential playground (or battlefield).
Fundamental Question - ANS ✔✔What determines the success and failure of firms around the globe?
Institution-Based View - ANS ✔✔Suggests that the success and failure of firms are enabled and
constrained by institutions.
Triple bottom line - ANS ✔✔Economic, social, and environmental performance
Stakeholder - ANS ✔✔Any group or individual who can affect or is affected by the achievement of a
firm's objectives.
"Rules of the game" - ANS ✔✔Doing business around the globe requires intimate knowledge about both
formal rules (such as laws) and informal rules (such as values) that govern competition in various
countries.
Resource-Based View - ANS ✔✔Focuses on a firm's internal resources and capabilities
Liability of foreignness - ANS ✔✔The inherent disadvantage that foreign firms experience in host
countries because of their nonnative status.
Globalization - ANS ✔✔The close integration of countries and peoples of the world (capital, people,
goods/services, technology)
, Emerging economies - ANS ✔✔A term that has gradually replaced the term "developing countries" since
the 1990s
Emerging markets - ANS ✔✔A term that is often used interchangeably with "emerging economies"
Base of the pyramid (BoP) - ANS ✔✔Economies where people make less than $2,000 per capita per year
Reverse innovation (or frugal innovation) - ANS ✔✔An innovation that is adopted first in emerging
economies and is then diffused around the world.
Risk management - ANS ✔✔The identification and assessment of risks and the preparation to minimize
the impact of high-risk, unfortunate events
Black swan event - ANS ✔✔An unpredictable event that is beyond what is normally expected and that
has severe consequences
Semiglobalization - ANS ✔✔A perspective that suggests that barriers to market integration at borders
are high, but not high enough to insulate countries from each other completely
Gross domestic product (GDP) - ANS ✔✔The sum of value added by resident firms, households, and
governments operating in an economy
Purchasing power parity (PPP) - ANS ✔✔A conversion that determines the equivalent amount of goods
and services that different currencies can purchase.
Gross national product (GNP) - ANS ✔✔GDP plus income from nonresident sources abroad
Gross national income (GNI) - ANS ✔✔GDP plus income from nonresident sources abroad; GNI is a term
used by the World Bank and other international organizations to supersede the term GNP
Institutional transition - ANS ✔✔Fundamental and comprehensive changes introduced to the formal and
informal rules of the game that affect firms as players
Institution - ANS ✔✔Formal and informal rules of the game
Institutional framework - ANS ✔✔Formal and informal institutions that govern individual and firm
behavior
Formal institution - ANS ✔✔Institution represented by laws, regulations, and rules
Regulatory pillar - ANS ✔✔The coercive power of governments
Informal institution - ANS ✔✔Institution represented by cultures, ethics, and norms
Normative pillar - ANS ✔✔The mechanism through which norms influence individual and firm behavior
Norms - ANS ✔✔Values, beliefs, and actions of relevant players that influence the focal individuals and
firms
QUESTIONS, ANSWERS & EXAM REVIEW
International business (IB) - ANS ✔✔(1) A business (firm) that engages in international (cross-border)
economic activities and/or (2) the action of doing business abroad
Multinational enterprise (MNE) - ANS ✔✔A firm that engages in foreign direct investment (FDI)
Foreign direct investment (FDI) - ANS ✔✔Investment in, controlling, and managing value-added activities
in other countries
Global business - ANS ✔✔Business around the globe
Global mindset - ANS ✔✔Ability to "connect the dots" globally
Expatriate manager (expat) - ANS ✔✔A manager who works abroad
International premium - ANS ✔✔A significant pay raise when working overseas
A Unified Framework - ANS ✔✔What is it that we do in global business?
It is about treating the global economy as your potential playground (or battlefield).
Fundamental Question - ANS ✔✔What determines the success and failure of firms around the globe?
Institution-Based View - ANS ✔✔Suggests that the success and failure of firms are enabled and
constrained by institutions.
Triple bottom line - ANS ✔✔Economic, social, and environmental performance
Stakeholder - ANS ✔✔Any group or individual who can affect or is affected by the achievement of a
firm's objectives.
"Rules of the game" - ANS ✔✔Doing business around the globe requires intimate knowledge about both
formal rules (such as laws) and informal rules (such as values) that govern competition in various
countries.
Resource-Based View - ANS ✔✔Focuses on a firm's internal resources and capabilities
Liability of foreignness - ANS ✔✔The inherent disadvantage that foreign firms experience in host
countries because of their nonnative status.
Globalization - ANS ✔✔The close integration of countries and peoples of the world (capital, people,
goods/services, technology)
, Emerging economies - ANS ✔✔A term that has gradually replaced the term "developing countries" since
the 1990s
Emerging markets - ANS ✔✔A term that is often used interchangeably with "emerging economies"
Base of the pyramid (BoP) - ANS ✔✔Economies where people make less than $2,000 per capita per year
Reverse innovation (or frugal innovation) - ANS ✔✔An innovation that is adopted first in emerging
economies and is then diffused around the world.
Risk management - ANS ✔✔The identification and assessment of risks and the preparation to minimize
the impact of high-risk, unfortunate events
Black swan event - ANS ✔✔An unpredictable event that is beyond what is normally expected and that
has severe consequences
Semiglobalization - ANS ✔✔A perspective that suggests that barriers to market integration at borders
are high, but not high enough to insulate countries from each other completely
Gross domestic product (GDP) - ANS ✔✔The sum of value added by resident firms, households, and
governments operating in an economy
Purchasing power parity (PPP) - ANS ✔✔A conversion that determines the equivalent amount of goods
and services that different currencies can purchase.
Gross national product (GNP) - ANS ✔✔GDP plus income from nonresident sources abroad
Gross national income (GNI) - ANS ✔✔GDP plus income from nonresident sources abroad; GNI is a term
used by the World Bank and other international organizations to supersede the term GNP
Institutional transition - ANS ✔✔Fundamental and comprehensive changes introduced to the formal and
informal rules of the game that affect firms as players
Institution - ANS ✔✔Formal and informal rules of the game
Institutional framework - ANS ✔✔Formal and informal institutions that govern individual and firm
behavior
Formal institution - ANS ✔✔Institution represented by laws, regulations, and rules
Regulatory pillar - ANS ✔✔The coercive power of governments
Informal institution - ANS ✔✔Institution represented by cultures, ethics, and norms
Normative pillar - ANS ✔✔The mechanism through which norms influence individual and firm behavior
Norms - ANS ✔✔Values, beliefs, and actions of relevant players that influence the focal individuals and
firms
