WGU D080 Exam QUESTIONS AND
CORRECT ANSWERS
What is globalization? - CORRECT ANSWER When international integration arises from the
interchange of world views, products, ideas, and other aspects of cultures.
different types of Globalization - CORRECT ANSWER 1. Economic
2. Political
3. Cultural
Advantages of Economic globalization - CORRECT ANSWER more trade, investments,
information technology, faster economic development, and increased social being
Disadvantages of Economic globalization - CORRECT ANSWER benefits the rich at the
expense of the poor, manufacturing job loss in developed countries, environmental damage, and
unethical practices of labor
Advantages of Political globalization - CORRECT ANSWER more cooperation amount
countries, formation of international or regional organizations, NGOs
Disadvantages of Political globalization - CORRECT ANSWER reduce the importance of
nation-states, loss of sovereignty and power of local government
Advantages of Cultural globalization - CORRECT ANSWER awareness of international
community
Disadvantages of Cultural globalization - CORRECT ANSWER loss of uniqueness of a
country's culture
What is international business? - CORRECT ANSWER any situation where the production or
distribution of goods or services crosses country borders
,What are opportunities for international business? - CORRECT ANSWER New and large
international markets offers possible more revenues, lower costs, and access to advanced technology
What are challenges for international business? - CORRECT ANSWER Ethical business
practice concerns, organizational structure (create new division), public relations (build customer
loyalty), leaderships, and legal and regulatory structure
What are the 5 stages of going global? - CORRECT ANSWER 1. Market entry
2. product specialization
3. value chain disaggregation
4. value chain reengineering
5. creation of new markets
Market Entry - CORRECT ANSWER Companies enter new countries using business models
similar to the ones deployed in their home markets
Product specialization - CORRECT ANSWER Companies transfer the full production process
of a particular product line to a single, low-cost location and export the goods to various consumer
markets
Value chain disaggregation - CORRECT ANSWER Companies disaggregate the production
process and focus on completing each activity in the most advantageous location
Value chain reengineering - CORRECT ANSWER Companies seek to further increase their
cost savings by reengineering their processes to suit local market conditions by substituting lower cost
labor for capital
Creation of new markets - CORRECT ANSWER creates new demand due to the reduction of
ticket price
What are the 4 drivers of Globalization? - CORRECT ANSWER 1. Market
2. Cost
3. Competition
, 4. Government
Market - CORRECT ANSWER Opportunity for scale and convergence of needs (foreign
consumers have the same demand as domestic consumer, no need to redesign)
Cost - CORRECT ANSWER - Economies of scale & scope: use same production facility for
multiple procedures.
- Exploiting cost of factors of production: labor cost reductions, natural resources cost reduction
Competition - CORRECT ANSWER New markets & increased levels of trade
Government - CORRECT ANSWER Favorable policies, support for the industry ((can use tax
bracket to attract FDI and subsidies (free money) can help domestic business reduce cost and charge
lower price))
What did Thomas Friedman propose? - CORRECT ANSWER The world is flat view - the use
of technology and internet has made it easier for businesses to conduct global operation
What did Ghemawat propose? - CORRECT ANSWER The world is a multi-domestic world
What is CAGE analysis? - CORRECT ANSWER Culture, Administration, Geography, and
Economics
Culture (CAGE) - CORRECT ANSWER Cultural difference could reduce country's trade
volume
Administration (CAGE) - CORRECT ANSWER Administrative similar countries trade more,
countries hold membership of the same trade
Geography (CAGE) - CORRECT ANSWER geographical distance between countries impact
trade volume
CORRECT ANSWERS
What is globalization? - CORRECT ANSWER When international integration arises from the
interchange of world views, products, ideas, and other aspects of cultures.
different types of Globalization - CORRECT ANSWER 1. Economic
2. Political
3. Cultural
Advantages of Economic globalization - CORRECT ANSWER more trade, investments,
information technology, faster economic development, and increased social being
Disadvantages of Economic globalization - CORRECT ANSWER benefits the rich at the
expense of the poor, manufacturing job loss in developed countries, environmental damage, and
unethical practices of labor
Advantages of Political globalization - CORRECT ANSWER more cooperation amount
countries, formation of international or regional organizations, NGOs
Disadvantages of Political globalization - CORRECT ANSWER reduce the importance of
nation-states, loss of sovereignty and power of local government
Advantages of Cultural globalization - CORRECT ANSWER awareness of international
community
Disadvantages of Cultural globalization - CORRECT ANSWER loss of uniqueness of a
country's culture
What is international business? - CORRECT ANSWER any situation where the production or
distribution of goods or services crosses country borders
,What are opportunities for international business? - CORRECT ANSWER New and large
international markets offers possible more revenues, lower costs, and access to advanced technology
What are challenges for international business? - CORRECT ANSWER Ethical business
practice concerns, organizational structure (create new division), public relations (build customer
loyalty), leaderships, and legal and regulatory structure
What are the 5 stages of going global? - CORRECT ANSWER 1. Market entry
2. product specialization
3. value chain disaggregation
4. value chain reengineering
5. creation of new markets
Market Entry - CORRECT ANSWER Companies enter new countries using business models
similar to the ones deployed in their home markets
Product specialization - CORRECT ANSWER Companies transfer the full production process
of a particular product line to a single, low-cost location and export the goods to various consumer
markets
Value chain disaggregation - CORRECT ANSWER Companies disaggregate the production
process and focus on completing each activity in the most advantageous location
Value chain reengineering - CORRECT ANSWER Companies seek to further increase their
cost savings by reengineering their processes to suit local market conditions by substituting lower cost
labor for capital
Creation of new markets - CORRECT ANSWER creates new demand due to the reduction of
ticket price
What are the 4 drivers of Globalization? - CORRECT ANSWER 1. Market
2. Cost
3. Competition
, 4. Government
Market - CORRECT ANSWER Opportunity for scale and convergence of needs (foreign
consumers have the same demand as domestic consumer, no need to redesign)
Cost - CORRECT ANSWER - Economies of scale & scope: use same production facility for
multiple procedures.
- Exploiting cost of factors of production: labor cost reductions, natural resources cost reduction
Competition - CORRECT ANSWER New markets & increased levels of trade
Government - CORRECT ANSWER Favorable policies, support for the industry ((can use tax
bracket to attract FDI and subsidies (free money) can help domestic business reduce cost and charge
lower price))
What did Thomas Friedman propose? - CORRECT ANSWER The world is flat view - the use
of technology and internet has made it easier for businesses to conduct global operation
What did Ghemawat propose? - CORRECT ANSWER The world is a multi-domestic world
What is CAGE analysis? - CORRECT ANSWER Culture, Administration, Geography, and
Economics
Culture (CAGE) - CORRECT ANSWER Cultural difference could reduce country's trade
volume
Administration (CAGE) - CORRECT ANSWER Administrative similar countries trade more,
countries hold membership of the same trade
Geography (CAGE) - CORRECT ANSWER geographical distance between countries impact
trade volume
