BSG Final Exam Correct Questions
And Answers
Many companies acquire a local business as a means of entering foreign markets
becauseCorrect Answers acquisition is quicker than creating a new subsidiary and
building its entire operations from the ground up, and it may be the least risky and cost-
efficient means of hurdling entry barriers.
Which of the following account for why companies decide to enter foreign markets?
Correct Answers To gain access to new customers and/or achieve lower costs and
thereby become more cost competitive
Because buyer tastes for a particular product or service sometimes differ substantially
from country to country,Correct Answers companies operating in a global marketplace
must wrestle with whether and how much to customize their offerings in each different
country market to match the tastes and preferences of local buyers or whether to
pursue a strategy of offering a mostly standardized product worldwide
The advantages of using a franchising strategy to pursue opportunities in foreign
markets includeCorrect Answers having franchisees bear most of the costs and risks of
establishing foreign locations and requiring the franchiser to expand only the resources
to recruit, train, support, and monitor foreign franchisees.
A company is said to be engaging in "cross market. subsidization" whenCorrect
Answers it supports a competitive offensive in one market with resources, capabilities,
and profits (cash flows) diverted from operations in other country markets.
Which of the following is not among the various strategic ways a company can establish
a competitive presence in foreign markets?Correct Answers A profit sanctuary strategy
Which of the following statements regarding global competition is false?Correct
Answers In global competition, there's more cross-country variation in industry
conditions and competitive forces than there is in industries where multicountry
competition prevails.
In which one of the following instances is it not advantageous to concentrate a
company's activities in a few locations?Correct Answers When the company is striving
to build profit sanctuaries in more than five different countries
Profit SanctuariesCorrect Answers are country markets (or geographic regions) in which
a company derives substantial profits because of its strong or protected market position
,Based on the content of Figure 7.2, which of the following is the most unlikely element
of a localized multicountry strategyCorrect Answers Using the best suppliers from
anywhere in the world
Domestic companies facing competitive pressure from lower-cost importsCorrect
Answers benefit when their government's currency declines in value relative to the
currencies of the countries where the lower cost foreign imports are being manufactured
According to Figure 7.2, which of the following does not accurately characterize the
differences between a localized multicountry strategy and a global strategy?Correct
Answers A global strategy involves striving to be the global low-cost provider by
economically producing and marketing a mostly standardized product worldwide
whereas a multicountry strategy entails pursuing broad differentiation and striving to
strongly differentiate its products in one country from the products it sells in other
countries.
A firm pursuing a "think global, act local" approach to strategy-makingCorrect Answers
pursues a competitive strategy that is essentially the same in all country markets where
it operates but it may nonetheless give local managers room to make minor variations
where necessary to better satisfy local buyers and to better match local market
conditions.
Which one of the following is among the important strategic issues associated with
competing across national boundaries?Correct Answers Whether to employ essentially
the same basic competitive strategy in all countries or modify the strategy country by
country to better match local market and competitive conditions
Competing in one or more countries or regions of the world causes strategy-making to
be more complex partly because ofCorrect Answers sizable cross-country differences in
wage rates, worker productivity, inflation rates, energy supplies and costs, tax rates,
and other factors that impact a company's costs and profit prospects.
Which one of the following is not a reason why a company decides to enter foreign
markets?Correct Answers To build the profit sanctuaries necessary to wage guerilla
offensives against global challengers endeavoring to invade the company's home
market
Competing in one or more countries or regions of the world causes strategy-making to
be more complex because ofCorrect Answers the risks of adverse shifts in currency
exchange rates and the presence of important cross-country differences in buyer tastes,
market sizes, and growth potential.
According to Figure 7.2, which one of the following is not a common trait of a global
strategy?Correct Answers Design manufacturing plants to cost-effectively produce
many different product versions
, Which of the following is not one of the strategic ways a company can establish a
competitive presence in foreign markets?Correct Answers Using the creation of profit
sanctuaries as the primary vehicle for entering foreign markets
Because there are country-country differences in buyer tastes, income levels,
distribution channels, competitive conditions, and other market-related factors that
impact a company's strategy choices,Correct Answers one of the managerial challenges
at companies with international or global operations is how best to tailor a company's
strategy to take all these cross-country differences into account.
Which of the following is the most unlikely element of a "think global, act global"
approach to crafting a global strategy?Correct Answers Having relatively small plants in
many countries, with each plant producing product versions for local area markets
The advantages of using a licensing strategy to participate in foreign markets
includeCorrect Answers being able to generate revenues and income from a company's
technical know-how or a unique patented product without committing a significant
additional resources to country markets that are unfamiliar politically volatile,
economically unstable, or otherwise risky
A company that has competitively powerful resources and capabilities can enhance its
competitiveness internationally and perhaps build competitive advantage byCorrect
Answers transferring a portion of these resources and capabilities from its operations in
one country to its operations in other countries because the cost of sharing or
transferring already developed resources and capabilities across country borders is low
in comparison to the time and considerable expense it takes for a country subsidiary to
build matching capabilities on its own
Which of the following qualifies as an offensive strategy for companies competing
internationally or globally?Correct Answers Dumping goods at cut-rate prices in the
markets of rivals
Which of the following statements regarding multicountry competition is false?Correct
Answers With multicountry competition the competitive arena among rival companies
involves several neighboring countries rather than either a single country or the world
market as a whole.
when the Brazilian real declines in value against the euro, a European-based company
that makes all of its goods at a plant in Brazil and then exports the Brazilian-made
goods to those European countries where the currency is eurosCorrect Answers is in
better position to compete against the makers of the same good whose plants are
located in euro-based European countries
Which of the following is not one of the problems and risks of strategic alliances
between domestic and foreign firms?Correct Answers Making it hard to pursue a
multicountry strategy as compared to a global strategy
And Answers
Many companies acquire a local business as a means of entering foreign markets
becauseCorrect Answers acquisition is quicker than creating a new subsidiary and
building its entire operations from the ground up, and it may be the least risky and cost-
efficient means of hurdling entry barriers.
Which of the following account for why companies decide to enter foreign markets?
Correct Answers To gain access to new customers and/or achieve lower costs and
thereby become more cost competitive
Because buyer tastes for a particular product or service sometimes differ substantially
from country to country,Correct Answers companies operating in a global marketplace
must wrestle with whether and how much to customize their offerings in each different
country market to match the tastes and preferences of local buyers or whether to
pursue a strategy of offering a mostly standardized product worldwide
The advantages of using a franchising strategy to pursue opportunities in foreign
markets includeCorrect Answers having franchisees bear most of the costs and risks of
establishing foreign locations and requiring the franchiser to expand only the resources
to recruit, train, support, and monitor foreign franchisees.
A company is said to be engaging in "cross market. subsidization" whenCorrect
Answers it supports a competitive offensive in one market with resources, capabilities,
and profits (cash flows) diverted from operations in other country markets.
Which of the following is not among the various strategic ways a company can establish
a competitive presence in foreign markets?Correct Answers A profit sanctuary strategy
Which of the following statements regarding global competition is false?Correct
Answers In global competition, there's more cross-country variation in industry
conditions and competitive forces than there is in industries where multicountry
competition prevails.
In which one of the following instances is it not advantageous to concentrate a
company's activities in a few locations?Correct Answers When the company is striving
to build profit sanctuaries in more than five different countries
Profit SanctuariesCorrect Answers are country markets (or geographic regions) in which
a company derives substantial profits because of its strong or protected market position
,Based on the content of Figure 7.2, which of the following is the most unlikely element
of a localized multicountry strategyCorrect Answers Using the best suppliers from
anywhere in the world
Domestic companies facing competitive pressure from lower-cost importsCorrect
Answers benefit when their government's currency declines in value relative to the
currencies of the countries where the lower cost foreign imports are being manufactured
According to Figure 7.2, which of the following does not accurately characterize the
differences between a localized multicountry strategy and a global strategy?Correct
Answers A global strategy involves striving to be the global low-cost provider by
economically producing and marketing a mostly standardized product worldwide
whereas a multicountry strategy entails pursuing broad differentiation and striving to
strongly differentiate its products in one country from the products it sells in other
countries.
A firm pursuing a "think global, act local" approach to strategy-makingCorrect Answers
pursues a competitive strategy that is essentially the same in all country markets where
it operates but it may nonetheless give local managers room to make minor variations
where necessary to better satisfy local buyers and to better match local market
conditions.
Which one of the following is among the important strategic issues associated with
competing across national boundaries?Correct Answers Whether to employ essentially
the same basic competitive strategy in all countries or modify the strategy country by
country to better match local market and competitive conditions
Competing in one or more countries or regions of the world causes strategy-making to
be more complex partly because ofCorrect Answers sizable cross-country differences in
wage rates, worker productivity, inflation rates, energy supplies and costs, tax rates,
and other factors that impact a company's costs and profit prospects.
Which one of the following is not a reason why a company decides to enter foreign
markets?Correct Answers To build the profit sanctuaries necessary to wage guerilla
offensives against global challengers endeavoring to invade the company's home
market
Competing in one or more countries or regions of the world causes strategy-making to
be more complex because ofCorrect Answers the risks of adverse shifts in currency
exchange rates and the presence of important cross-country differences in buyer tastes,
market sizes, and growth potential.
According to Figure 7.2, which one of the following is not a common trait of a global
strategy?Correct Answers Design manufacturing plants to cost-effectively produce
many different product versions
, Which of the following is not one of the strategic ways a company can establish a
competitive presence in foreign markets?Correct Answers Using the creation of profit
sanctuaries as the primary vehicle for entering foreign markets
Because there are country-country differences in buyer tastes, income levels,
distribution channels, competitive conditions, and other market-related factors that
impact a company's strategy choices,Correct Answers one of the managerial challenges
at companies with international or global operations is how best to tailor a company's
strategy to take all these cross-country differences into account.
Which of the following is the most unlikely element of a "think global, act global"
approach to crafting a global strategy?Correct Answers Having relatively small plants in
many countries, with each plant producing product versions for local area markets
The advantages of using a licensing strategy to participate in foreign markets
includeCorrect Answers being able to generate revenues and income from a company's
technical know-how or a unique patented product without committing a significant
additional resources to country markets that are unfamiliar politically volatile,
economically unstable, or otherwise risky
A company that has competitively powerful resources and capabilities can enhance its
competitiveness internationally and perhaps build competitive advantage byCorrect
Answers transferring a portion of these resources and capabilities from its operations in
one country to its operations in other countries because the cost of sharing or
transferring already developed resources and capabilities across country borders is low
in comparison to the time and considerable expense it takes for a country subsidiary to
build matching capabilities on its own
Which of the following qualifies as an offensive strategy for companies competing
internationally or globally?Correct Answers Dumping goods at cut-rate prices in the
markets of rivals
Which of the following statements regarding multicountry competition is false?Correct
Answers With multicountry competition the competitive arena among rival companies
involves several neighboring countries rather than either a single country or the world
market as a whole.
when the Brazilian real declines in value against the euro, a European-based company
that makes all of its goods at a plant in Brazil and then exports the Brazilian-made
goods to those European countries where the currency is eurosCorrect Answers is in
better position to compete against the makers of the same good whose plants are
located in euro-based European countries
Which of the following is not one of the problems and risks of strategic alliances
between domestic and foreign firms?Correct Answers Making it hard to pursue a
multicountry strategy as compared to a global strategy
