Objective Assessment Actual Practice Questions with
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1. Globalization & global business drivers (Q1–30)
2. Trade theories, economic systems & institutions (Q31–60)
3. Entry strategies, FDI & global strategy (Q61–90)
4. Culture, ethics, legal & political risk (Q91–120)
5. Technology, global trends & sustainability (Q121–150)
SECTION 1 – Globalization & Global Business Drivers (Q1–30)
Q1. Which option best describes economic globalization?
A. Companies operate only in their home country
B. Integration of national economies through trade, investment, and capital flows
,C. Restricting foreign investment by law
D. Use of technology only inside one firm
B. Integration of national economies through trade, investment, and capital flows
Globalization in the course context focuses on how goods, services, money, and knowledge
move across borders, creating interdependent economies rather than isolated national
markets.
Q2. According to Friedman’s “Globalization 3.0”, which factor primarily drives global
integration?
A. Powerful nation-states expanding territory
B. Multinational corporations seeking new markets
C. Individual and small-group digital collaboration across borders
D. Colonial empires controlling trade routes
C. Individual and small-group digital collaboration across borders
Friedman’s third stage emphasizes that technology and the internet empower individuals,
small firms, and entrepreneurs to participate in global work, outsourcing, and innovation
without large corporate or state gatekeepers.
Q3. Which is an example of a market driver of industry globalization?
A. A firm seeking lower labour costs in another country
B. Similar customer needs and preferences across multiple countries
C. Government subsidies for exports
D. Competitors entering foreign markets first
,B. Similar customer needs and preferences across multiple countries
Market drivers exist when customers in different countries want similar products; this
encourages firms to standardize offerings and expand internationally to serve those
common demands efficiently.
Q4. A company moves production to Vietnam to lower manufacturing costs. Which
globalization driver is most relevant?
A. Market driver
B. Cost driver
C. Government driver
D. Competitive driver
B. Cost driver
Cost drivers relate to differences in wages, infrastructure, and raw material costs between
countries; firms relocate production to reduce expenses while maintaining product quality
and competitiveness.
Q5. Government drivers of globalization typically include:
A. Differences in consumer tastes
B. Trade liberalization, free-trade agreements, and investment incentives
C. Currency speculation by hedge funds
D. Informal social media campaigns
B. Trade liberalization, free-trade agreements, and investment incentives
Governments accelerate globalization when they reduce tariffs, sign regional agreements,
, simplify customs rules, and offer tax breaks or subsidies, making cross-border business
operations easier and cheaper.
Q6. What is a competitive driver of globalization?
A. Desire to avoid foreign markets entirely
B. Pressure to follow rivals into new markets to defend market share
C. Government tariffs protecting domestic industries
D. Cultural differences between countries
B. Pressure to follow rivals into new markets to defend market share
When competitors expand globally, firms may feel compelled to enter the same markets to
avoid losing customers, maintain brand visibility, and access similar resources, driving
industry-wide internationalization.
Q7. “Value chain disaggregation” in going global means:
A. Keeping all activities in the home country
B. Splitting production, R&D, marketing, and logistics across different countries
C. Outsourcing only customer service
D. Only exporting finished goods
B. Splitting production, R&D, marketing, and logistics across different countries
Disaggregation occurs when firms locate value-adding activities wherever they gain
comparative advantages, such as cheaper labour, specialized skills, or faster logistics,
rather than performing everything domestically.