WGU C211 GLOBAL ECONOMICS FOR
MANAGERS CERTIFICATION EVALUATION
◉ OLI advantages. Answer: A firms quest for ownership (O)
advantages, location (L) advantages, and internalization (I)
advantages via FDI.
◉ Oligopoly. Answer: Industry dominated by a small number of
players.
◉ Ownership. Answer: An MNE's possession and leveraging of
certain valuable, rare, hard-to-imitate, and organizationally
embedded (VRIO) assets overseas in the context of FDI.
◉ Pragmatic nationalism on FDI. Answer: A political view that only
approves FDI when its benefits outweigh its costs.
◉ Radical view on FDI. Answer: A political view that is hostile to FDI.
◉ Sunk cost. Answer: Cost that a firm has to endure even when its
investment turns out to be unsatisfactory
,◉ Technology spillover. Answer: Technology diffused from foreign
firms to domestic firms.
◉ Upstream vertical FDI. Answer: A type of vertical FDI in which a
firm engages in an upstream stage of the value chain in a host
country.
◉ Vertical FDI. Answer: A type of FDI in which a firm moves
upstream or downstream at different value chain stages in a host
country.
◉ Antidumping law. Answer: Law that makes it illegal for an
exporter to sell goods below cost abroad with the intent to raise
prices after eliminating local rivals.
◉ Antitrust law. Answer: Law that outlaws cartels (trusts).
◉ Antitrust policy. Answer: Government policy designed to combat
monopolies and cartels.
◉ Attack. Answer: An initial set of actions to gain competitive
advantage.
,◉ Blue ocean strategy. Answer: Strategy that focuses on developing
new markets ("blue ocean") and avoids attacking core markets
defended by rivals, which is likely to result in a bloody price war or a
"red ocean."
◉ Capacity to punish. Answer: Sufficient resources possessed by a
price leader to deter and combat defection.
◉ Cartel (trust). Answer: An output- and price-fixing entity
involving multiple competitors.
◉ Collusion. Answer: Collective attempts between competing firms
to reduce competition.
◉ Collusive price setting. Answer: Price setting by monopolists or
collusion parties at a level higher than the competitive level.
◉ Competition policy. Answer: Government policy governing the
rules of the game in competition.
◉ Competitive dynamics. Answer: Actions and responses
undertaken by competing firms.
, ◉ Competitor analysis. Answer: The process of anticipating rivals'
actions in order to both revise a firm's plan and prepare to deal with
rivals' response.
◉ Concentration ratio. Answer: The percentage of total industry
sales accounted for by the top four, eight, or twenty firms.
◉ Contender. Answer: Strategy that centers on a firm engaging in
rapid learning and then expanding overseas.
◉ Counterattack. Answer: A set of actions in response to attack.
◉ Cross-market retaliation. Answer: Retaliatory attacks on a
competitor's other markets if this competitor attacks a firm's
original market.
◉ Defender. Answer: Strategy that centers on local assets in areas in
which MNEs are weak.
◉ Dodger. Answer: Strategy that centers on cooperating through
joint ventures with MNEs and sell-offs to MNEs.
◉ Dumping. Answer: An exporter selling goods below cost.
MANAGERS CERTIFICATION EVALUATION
◉ OLI advantages. Answer: A firms quest for ownership (O)
advantages, location (L) advantages, and internalization (I)
advantages via FDI.
◉ Oligopoly. Answer: Industry dominated by a small number of
players.
◉ Ownership. Answer: An MNE's possession and leveraging of
certain valuable, rare, hard-to-imitate, and organizationally
embedded (VRIO) assets overseas in the context of FDI.
◉ Pragmatic nationalism on FDI. Answer: A political view that only
approves FDI when its benefits outweigh its costs.
◉ Radical view on FDI. Answer: A political view that is hostile to FDI.
◉ Sunk cost. Answer: Cost that a firm has to endure even when its
investment turns out to be unsatisfactory
,◉ Technology spillover. Answer: Technology diffused from foreign
firms to domestic firms.
◉ Upstream vertical FDI. Answer: A type of vertical FDI in which a
firm engages in an upstream stage of the value chain in a host
country.
◉ Vertical FDI. Answer: A type of FDI in which a firm moves
upstream or downstream at different value chain stages in a host
country.
◉ Antidumping law. Answer: Law that makes it illegal for an
exporter to sell goods below cost abroad with the intent to raise
prices after eliminating local rivals.
◉ Antitrust law. Answer: Law that outlaws cartels (trusts).
◉ Antitrust policy. Answer: Government policy designed to combat
monopolies and cartels.
◉ Attack. Answer: An initial set of actions to gain competitive
advantage.
,◉ Blue ocean strategy. Answer: Strategy that focuses on developing
new markets ("blue ocean") and avoids attacking core markets
defended by rivals, which is likely to result in a bloody price war or a
"red ocean."
◉ Capacity to punish. Answer: Sufficient resources possessed by a
price leader to deter and combat defection.
◉ Cartel (trust). Answer: An output- and price-fixing entity
involving multiple competitors.
◉ Collusion. Answer: Collective attempts between competing firms
to reduce competition.
◉ Collusive price setting. Answer: Price setting by monopolists or
collusion parties at a level higher than the competitive level.
◉ Competition policy. Answer: Government policy governing the
rules of the game in competition.
◉ Competitive dynamics. Answer: Actions and responses
undertaken by competing firms.
, ◉ Competitor analysis. Answer: The process of anticipating rivals'
actions in order to both revise a firm's plan and prepare to deal with
rivals' response.
◉ Concentration ratio. Answer: The percentage of total industry
sales accounted for by the top four, eight, or twenty firms.
◉ Contender. Answer: Strategy that centers on a firm engaging in
rapid learning and then expanding overseas.
◉ Counterattack. Answer: A set of actions in response to attack.
◉ Cross-market retaliation. Answer: Retaliatory attacks on a
competitor's other markets if this competitor attacks a firm's
original market.
◉ Defender. Answer: Strategy that centers on local assets in areas in
which MNEs are weak.
◉ Dodger. Answer: Strategy that centers on cooperating through
joint ventures with MNEs and sell-offs to MNEs.
◉ Dumping. Answer: An exporter selling goods below cost.
