Chapter 01
The Challenging World of International Business
True / False Questions
1. American companies want their managers to have a basic knowledge of international
business.
True False
2. Only those companies that have foreign operations need to be aware of what is occurring
globally in its markets and their industry.
True False
3. Foreign business is business whose activities are carried out across national borders.
True False
4. An international company is an organization with multicountry affiliates, each of which
formulates its own business strategy based on perceived market differences.
True False
5. A business whose activities are carried out across national borders is known as an
international business.
True False
6. Foreign business refers to the operations of a company outside its home or domestic
market.
True False
,7. The term international business is used to describe an organization with multicountry
affiliates, each of which formulates its own business strategy based on perceived market
differences.
True False
8. A multidomestic company is an organization that attempts to standardize and integrate
operations worldwide in all functional areas.
True False
9. The term international company refers to both global and multidomestic companies.
True False
10. A global company is an organization that attempts to standardize and integrate
operations worldwide in most or all functional areas.
True False
11. According to the definitions in the text, a multidomestic firm is an organization that
attempts to standardize operations worldwide in all functional areas.
True False
12. The United Nations uses the term transnational to describe an enterprise doing business
in more than one country.
True False
13. International business differs from domestic business in that a firm operating across
borders must deal with the forces of two kinds of environments-domestic and foreign.
True False
,14. External forces in the international business environment are commonly called
uncontrollable forces.
True False
15. According to the text, environmental elements over which management does have some
control-include competitive, labor, and financial forces-are called the internal forces.
True False
16. External environmental forces are commonly referred to as controllable.
True False
17. Internal environmental forces are commonly referred to as controllable.
True False
18. The international environment is composed of all the uncontrollable forces originating
in the home country.
True False
19. According to the text, the international environment is all of the uncontrollable forces
originating outside the home country that surround and influence the firm.
True False
20. According to the text, the domestic environment is all of the uncontrollable forces
originating in the home country that surround and influence the firm's life and
development.
True False
, 21. The forces in the international environment are the same as those in the domestic
environment except that they occur in foreign nations.
True False
22. A common cause of the added complexity of foreign environments is managers'
unfamiliarity with other cultures and is called self-reference syndrome.
True False
23. According to the text, the self-absorption criterion is probably the biggest cause of
international business blunders.
True False
24. While international business as a discipline is relatively new, international business as a
business practice is not.
True False
25. Britain was the world's leading manufacturing country for about 1,800 years, until it
was replaced by the United States at the end of the 1800s.
True False
26. According to the text, the level of intracompany trade of multinationals in 1930, as a
percentage of world trade, may have exceeded the proportion at the end of the 20 th century.
True False
27. Transnational corporations account for approximately 25 percent of total global output
and nearly 50 percent of world trade.
True False
The Challenging World of International Business
True / False Questions
1. American companies want their managers to have a basic knowledge of international
business.
True False
2. Only those companies that have foreign operations need to be aware of what is occurring
globally in its markets and their industry.
True False
3. Foreign business is business whose activities are carried out across national borders.
True False
4. An international company is an organization with multicountry affiliates, each of which
formulates its own business strategy based on perceived market differences.
True False
5. A business whose activities are carried out across national borders is known as an
international business.
True False
6. Foreign business refers to the operations of a company outside its home or domestic
market.
True False
,7. The term international business is used to describe an organization with multicountry
affiliates, each of which formulates its own business strategy based on perceived market
differences.
True False
8. A multidomestic company is an organization that attempts to standardize and integrate
operations worldwide in all functional areas.
True False
9. The term international company refers to both global and multidomestic companies.
True False
10. A global company is an organization that attempts to standardize and integrate
operations worldwide in most or all functional areas.
True False
11. According to the definitions in the text, a multidomestic firm is an organization that
attempts to standardize operations worldwide in all functional areas.
True False
12. The United Nations uses the term transnational to describe an enterprise doing business
in more than one country.
True False
13. International business differs from domestic business in that a firm operating across
borders must deal with the forces of two kinds of environments-domestic and foreign.
True False
,14. External forces in the international business environment are commonly called
uncontrollable forces.
True False
15. According to the text, environmental elements over which management does have some
control-include competitive, labor, and financial forces-are called the internal forces.
True False
16. External environmental forces are commonly referred to as controllable.
True False
17. Internal environmental forces are commonly referred to as controllable.
True False
18. The international environment is composed of all the uncontrollable forces originating
in the home country.
True False
19. According to the text, the international environment is all of the uncontrollable forces
originating outside the home country that surround and influence the firm.
True False
20. According to the text, the domestic environment is all of the uncontrollable forces
originating in the home country that surround and influence the firm's life and
development.
True False
, 21. The forces in the international environment are the same as those in the domestic
environment except that they occur in foreign nations.
True False
22. A common cause of the added complexity of foreign environments is managers'
unfamiliarity with other cultures and is called self-reference syndrome.
True False
23. According to the text, the self-absorption criterion is probably the biggest cause of
international business blunders.
True False
24. While international business as a discipline is relatively new, international business as a
business practice is not.
True False
25. Britain was the world's leading manufacturing country for about 1,800 years, until it
was replaced by the United States at the end of the 1800s.
True False
26. According to the text, the level of intracompany trade of multinationals in 1930, as a
percentage of world trade, may have exceeded the proportion at the end of the 20 th century.
True False
27. Transnational corporations account for approximately 25 percent of total global output
and nearly 50 percent of world trade.
True False
