WGU C211 Final certification Study
Guide Questions with Already Passed
Answers 2023/2024
Globalization - correct answers Is the close integration of countries and peoples of the
world which has been brought about by the enormous reduction of the cost of
transportation and communication, and the breaking down of artificial barriers to the
flows of goods, services, capital, knowledge, and (to a lesser extent) people across
borders.
New view of Globalization - correct answers A new force sweeping through the world
in recent times that it is a new phenomenon beginning in the late 20th century, driven by
recent technological innovations and a Western ideology focused on exploiting and
dominating the world through a Multinational enterprises.
Evolutionary view of globalization - correct answers A long run historical evolution
since the down of human history. Historians are debating whether globalization started
2,000 or 8,000 years ago. Earliest traces of globalization goes back to the Assyrian,
Phoenician, and Roman times.
Pendulum view of globalization - correct answers A pendulum that swings from one
extreme to another from time to time. Globalization is neither recent or one-directional.
Risk management and scenario planning is needed.
What is Foreign Direct Investment (FDI)? - correct answers Investment in, controlling
and managing value-added activities in other countries. In other words, investment
made by a firm or individual in one country into business interest located in another
country. Most discussed foreign entrance is MNE.
MNE: Multinational Enterprise - correct answers Is a firm that engages in FDI when
doing business abroad. FDI sets apart MNEs and non-MNEs.
What different political views exists on FDI? - correct answers -in developed
economies, backlash against inbound FDI from certain countries is not unusual.
Example, in the 1980s, Americans were alarmed by the significant Japanese inroads
into the United States.
-in some parts of the developing world, tension over foreign ownership can heat up.
There were numerous incidents of nationalization and expropriation against MNE assets
throughout the developing world.
What 4 benefits exist to a country receiving FDI? - correct answers 1. Capital inflow
improve the host country balance of payment. More technology, management, and
more jobs in their countries.
,2. Technology, especially more advanced technology from abroad, can create
technology spillovers that benefits domestic firms and industries. Local rivals can learn
and imitate such technology resulting in what's called demonstration effect (contagion
effect).
3. Advanced management know how may be highly valued. It's often difficult for
indigenous development of management to know how to reach a world-class level in
absence of FDI.
4. FDI creates jobs, both directly and indirectly. Direct benefits arise when MNEs
employ individuals locally.
What costs exist to a country receiving FDI? - correct answers 1. Loss of sovereignty
2. Adverse effects on competition
3. capital outlfow
How do resources and capabilities influence the competitive dynamics of a business? -
correct answers Firm resources must create value when engaging rivals. The ability to
respond rapidly to challenges also adds value.
Competitive Dynamics - correct answers Actions and responses undertaken by
competing firms.
What is resource similarity? - correct answers Extent to which a given competitor
possesses strategic endowment comparable in terms of both type and amount to those
of the local firm. In order words, extent to which firm's tangible/intangible resources are
comparable to competitors in type and amount.
How does resource similarity impact competitive dynamics? - correct answers Firms
with a high degree of resources similarity are likely to have similar competitive actions.
For example, Apple and IBM used to have a lot of resource similarity in the 1990s that
they fought a lot.
Classical theory of international trade. - correct answers 1. Mercantilism
2. Absolute advantage
3. Comparative advantage
Mercantilism - correct answers Theory that suggests that the wealth of the world is
fixed and that a nation that exports more and imports less will be richer. On the other
hand, a nation experiencing a trade deficit would see its gold and silver flowing out and,
consequently, would become poorer. International trade is a zero-sum game.
Absolute advantage - correct answers Theory that suggests that under free trade, a
nation gains by specializing in economic activities in which it has an absolute advantage
with free trade market forces are determined with little to no government intervention.
The economic advantage one nation enjoys that is absolutely superior to other nations.
International trade is a win-win game. There are net gains from trade.
, Comparative advantage - correct answers Theory that focuses on the relative (not
absolute) advantage in one economic activity that one nation enjoys in comparison with
other nations. It suggests that the U.S. has an absolute advantage over China in both
wheat and aircraft, but as longs as China is not equally less efficient in production of
both goods, China can still choose to specialize in the production of one good. There
are net gains from trade.
-opportunity cost is a crucial concept here.
Opportunity cost - correct answers The cost of pursuing one activity at the expense of
another activity.
Factor endowments - correct answers The extent to which different countries possess
various factors of production such as labor, land, and technology.
Modern Theory - correct answers 1. Product life cycle.
2. Strategic trade.
3. National competitive advantage
Product life cycle - correct answers A theory that accounts for changes in the patterns
of trade over time by focusing on product life cycle.
1. New: production of a new product that commands a price premium will concentrate in
the United States which exports to other developed nations.
2. Maturing stage: demand and ability to produce grow in other developed nations so it
is now worthwhile to produce there.
3. Standardized (commoditized): production moves to low-cost developing nations,
which export to developed nations. Comparative advantage may change over time.
Strategic trade theory - correct answers Suggests that strategic intervention by
governments in certain industries can enhance their odds for international success.
These industries tend to be high capital-intensive, high-entry-barrier industries in which
firms may have little chance without government assistance. These industries feature
first-mover advantages.
Strategic trade policy - correct answers Government policy that provides companies a
strategic advantage in international trade through subsidies and other supports.
First mover advantages - correct answers Advantages that first entrants enjoy and do
not share with late entrants.
National competitive advantage - correct answers Theory that suggest that the
competitive advantage of certain industries in different nations depends on four aspects
that form a "diamond." Theory focuses on why certain industries within a nation are
competitive internationally.
Guide Questions with Already Passed
Answers 2023/2024
Globalization - correct answers Is the close integration of countries and peoples of the
world which has been brought about by the enormous reduction of the cost of
transportation and communication, and the breaking down of artificial barriers to the
flows of goods, services, capital, knowledge, and (to a lesser extent) people across
borders.
New view of Globalization - correct answers A new force sweeping through the world
in recent times that it is a new phenomenon beginning in the late 20th century, driven by
recent technological innovations and a Western ideology focused on exploiting and
dominating the world through a Multinational enterprises.
Evolutionary view of globalization - correct answers A long run historical evolution
since the down of human history. Historians are debating whether globalization started
2,000 or 8,000 years ago. Earliest traces of globalization goes back to the Assyrian,
Phoenician, and Roman times.
Pendulum view of globalization - correct answers A pendulum that swings from one
extreme to another from time to time. Globalization is neither recent or one-directional.
Risk management and scenario planning is needed.
What is Foreign Direct Investment (FDI)? - correct answers Investment in, controlling
and managing value-added activities in other countries. In other words, investment
made by a firm or individual in one country into business interest located in another
country. Most discussed foreign entrance is MNE.
MNE: Multinational Enterprise - correct answers Is a firm that engages in FDI when
doing business abroad. FDI sets apart MNEs and non-MNEs.
What different political views exists on FDI? - correct answers -in developed
economies, backlash against inbound FDI from certain countries is not unusual.
Example, in the 1980s, Americans were alarmed by the significant Japanese inroads
into the United States.
-in some parts of the developing world, tension over foreign ownership can heat up.
There were numerous incidents of nationalization and expropriation against MNE assets
throughout the developing world.
What 4 benefits exist to a country receiving FDI? - correct answers 1. Capital inflow
improve the host country balance of payment. More technology, management, and
more jobs in their countries.
,2. Technology, especially more advanced technology from abroad, can create
technology spillovers that benefits domestic firms and industries. Local rivals can learn
and imitate such technology resulting in what's called demonstration effect (contagion
effect).
3. Advanced management know how may be highly valued. It's often difficult for
indigenous development of management to know how to reach a world-class level in
absence of FDI.
4. FDI creates jobs, both directly and indirectly. Direct benefits arise when MNEs
employ individuals locally.
What costs exist to a country receiving FDI? - correct answers 1. Loss of sovereignty
2. Adverse effects on competition
3. capital outlfow
How do resources and capabilities influence the competitive dynamics of a business? -
correct answers Firm resources must create value when engaging rivals. The ability to
respond rapidly to challenges also adds value.
Competitive Dynamics - correct answers Actions and responses undertaken by
competing firms.
What is resource similarity? - correct answers Extent to which a given competitor
possesses strategic endowment comparable in terms of both type and amount to those
of the local firm. In order words, extent to which firm's tangible/intangible resources are
comparable to competitors in type and amount.
How does resource similarity impact competitive dynamics? - correct answers Firms
with a high degree of resources similarity are likely to have similar competitive actions.
For example, Apple and IBM used to have a lot of resource similarity in the 1990s that
they fought a lot.
Classical theory of international trade. - correct answers 1. Mercantilism
2. Absolute advantage
3. Comparative advantage
Mercantilism - correct answers Theory that suggests that the wealth of the world is
fixed and that a nation that exports more and imports less will be richer. On the other
hand, a nation experiencing a trade deficit would see its gold and silver flowing out and,
consequently, would become poorer. International trade is a zero-sum game.
Absolute advantage - correct answers Theory that suggests that under free trade, a
nation gains by specializing in economic activities in which it has an absolute advantage
with free trade market forces are determined with little to no government intervention.
The economic advantage one nation enjoys that is absolutely superior to other nations.
International trade is a win-win game. There are net gains from trade.
, Comparative advantage - correct answers Theory that focuses on the relative (not
absolute) advantage in one economic activity that one nation enjoys in comparison with
other nations. It suggests that the U.S. has an absolute advantage over China in both
wheat and aircraft, but as longs as China is not equally less efficient in production of
both goods, China can still choose to specialize in the production of one good. There
are net gains from trade.
-opportunity cost is a crucial concept here.
Opportunity cost - correct answers The cost of pursuing one activity at the expense of
another activity.
Factor endowments - correct answers The extent to which different countries possess
various factors of production such as labor, land, and technology.
Modern Theory - correct answers 1. Product life cycle.
2. Strategic trade.
3. National competitive advantage
Product life cycle - correct answers A theory that accounts for changes in the patterns
of trade over time by focusing on product life cycle.
1. New: production of a new product that commands a price premium will concentrate in
the United States which exports to other developed nations.
2. Maturing stage: demand and ability to produce grow in other developed nations so it
is now worthwhile to produce there.
3. Standardized (commoditized): production moves to low-cost developing nations,
which export to developed nations. Comparative advantage may change over time.
Strategic trade theory - correct answers Suggests that strategic intervention by
governments in certain industries can enhance their odds for international success.
These industries tend to be high capital-intensive, high-entry-barrier industries in which
firms may have little chance without government assistance. These industries feature
first-mover advantages.
Strategic trade policy - correct answers Government policy that provides companies a
strategic advantage in international trade through subsidies and other supports.
First mover advantages - correct answers Advantages that first entrants enjoy and do
not share with late entrants.
National competitive advantage - correct answers Theory that suggest that the
competitive advantage of certain industries in different nations depends on four aspects
that form a "diamond." Theory focuses on why certain industries within a nation are
competitive internationally.
