Western Governors University GLOBAL BUS D080 questions Module 2 – Unit 1 graded A+

Module 2 – Unit 1) Members of a work team are from many different countries. They share their thoughts on developing a strategy to market a product in several different countries. What is the term for the international integration of the team members' exchange of worldviews and ideas to develop the strategy? a. Globalization b. Job availability c. Wealth inequality d. Outsourcing Which type of globalization refers to the international movement of goods, capital, and services? a. Cultural b. Economic c.Anti d.Social 5 stages of going global 1. Market entry; companies enter new countries 2. Product Specialization; Full production to a single, low-cost location 3. Value chain disaggregation; Complete each activity in the most advantageous location 4. Value chain reengineering; Companies seek further cost savings, substituting lower cost labor for capital 5. Creation of new markets; market expansion The CEO of an international company reminds the executive vice presidents that while the company may do good while performing corporate social responsibilities, the business has one ultimate goal since it is engaged in commercial activities with corporate shareholders. Which ultimate goal is the CEO emphasizing to the executive vice presidents? a. Stakeholder satisfaction b. Exporting c. Cultural exchange d. Profitability A CEO seeks to better use the economies of scale and scope of production to increase the international company's profits. Which type of globalization driver is the CEO seeking to use? a. Competition b. Government c. Market d. Cost A CEO is discussing an expansion of production of a company's highly perishable dairy line in a country that can offer low labor costs and good internet connections. The country has no highways, and roads are poorly maintained. Which challenge to international business expansion do the road conditions present? a. Legal b. Relational c. Infrastructure d. Ethical Which factor is an element of a CAGE analysis when assessing barriers to cross-border activity? a. Census b. Armament c. Gross domestic product d. Economics Which factor of CAGE addresses differences in country size that affect barriers to globalization? a. Economics b. Geography c. Administration d. Culture Which argument is used by critics who wish to discourage movement towards globalization? a. It increases consumer prices across the world. b. It decreases the pace of new product development. c. It increases the wealth of the rich rather than the poor. d. It decreases awareness of the international community. Which accommodation should an American multinational company make to conduct business in China? a. Restrictions concerning oil production b. Restrictions on freedom of speech b. Regulations for waste disposal d. Regulations for child safety Which type of economy is decentralized and allows firms and households to participate in global trade with minimum governmental interference? a. Command b. Mixed c. Market d. Traditional Mixed economic system; This system protects private property and is driven by self-interest, and the government can intervene in the market as needed Market economic system; This system’s production is controlled by private owners who can choose to participate in global trade Command economic system; This system’s property is publicly owned, and the government controls economic production. Which type of legal system is based on a code and focuses on how the law is applied to the facts? a. Theocratic b. Civil c. Common d. Religious Which law is based on tradition and precedent given that judicial rulings can stand as precedents for future cases? a. Civil b. Common c. Religious d.Theocratic Which legal system can vary from community to community and is found in countries without strong formal justice systems? a. Common b. Civil c. Canon d. Customary In which legal system does a judge decide the applicable law for the case as a jury determines the facts? a. Common b. Civil c. Canon d. Customary Unit 1. Quiz) Which type of globalization is represented by Sure Start expanding into South America, Europe, and Asia? a. Legal b. Political c. Cultural d. Economic Sure Start is starting a new division for rechargeable batteries in different parts of the world. What was the globalization driver of this decision? a. Market b. Government c. Competition d. Cost Which anti-globalization argument could lead to Sure Start continuing to maintain its current factories instead of moving them to Asia? a. Tariffs for batteries made in Vietnam will make them less expensive. b. Labor laws in Germany will ensure the company maintains ethical labor practices. c. Moving manufacturing to Vietnam will result in lower profits for the company. d. Factory workers fear their jobs will be moved to another country. Which action should the U.S. government take to encourage Sure Start to keep electric battery production in the country? a. Impose tariffs on batteries made in Vietnam b. Enact more strict environmental regulations of U.S.–produced batteries c. Allow dumping of batteries made in Vietnam d. Levy a value-added tax on manufacturing activity in the United States Which economic system facilitates the global expansion of Sure Start? a. Market b. Command c. Traditional d. Mixed Which legal system will Sure Start be following when they begin operating in Germany? a. Religious law b. Civil law c. Common law d. Cannon law Unit 2. Which activity of the International Monetary Fund (IMF) impacts policymaking? a. Offering investment services to countries b. Engaging over 10,000 staff in cultural affairs training and development c. Supporting loans to developing countries d. Being owned and directed by the governments of the member nations What is a characteristic of the International Monetary Fund (IMF)? a. The IMF loans to all nations and helps increase their resources. b. The IMF is a cooperative institution and provides more effective currency exchange. c. The IMF provides financial assistance to all nations and improves their investment capability. d. The IMF is a developmental institution and supports developing countries. What was the initial purpose of the International Monetary Fund (IMF) in phase one, prior to 1973? a. Regulated currency exchange between nations b. Supervised economic policies c. Provided a means for nations to easily exchange currency d. Offered loans to member organizations How does the International Monetary Fund (IMF) impact international organizations and governments? a. It complicates the process for nations to borrow and loan. b. It over-represents the global south. c. It provides limited financial assistance to the wealthy populations. d. It reduces funding for social programs. What is a common name for the International Bank for Reconstruction and Development? a. European Central Bank b. Federal Reserve Bank c. World Bank d. International Monetary Fund What was the first loan that the World Bank made after the end of World War II? a. To France to rebuild its infrastructure b. To the U.S. to rebuild Europe's infrastructure c. To Switzerland for being neutral in the war d. To Germany to rebuild its military Which criticism is associated with the World Bank? a. The developing countries of Asia and Africa have too much control over its decisions. b. The developed countries such as the U.S. and Europe have too much control over its decisions. c. It makes loans that are too large and cannot be repaid. d. It does not offer large enough loans to developing countries. Which criticism is made about the World Bank? a. It does not consider how funding projects will affect the environment. b. It makes too many loans to countries with strong governments. c. It supports government ownership of property. d. It funds too many projects in developed countries. What was one of the results of the Uruguay Round of the World Trade Organization negotiations? a. Decrease in world-wide money supply b. Decrease in tariffs c. Increase in tariffs d. Increase in world-wide money supply Which strategic network was established to work towards decreasing tariff rates and protecting commerce and intellectual property globally? a. World Trade Organization (WTO) b. North American Free Trade Agreement (NAFTA) c. European Union (EU) d. International Monetary Fund (IMF) Which organization was formed after World War II to encourage international commerce? a. International Monetary Fund b. European Central Bank c. Federal Reserve d. World Trade Organization Which criticism is made about the World Trade Organization (WTO)? a. It increases the quantity of money in the worldwide economy. b. It protects developed countries more than developing countries. c. It decreases the quantity of money in the worldwide economy. d. It protects developing countries more than developed countries. Unit 2. Quiz) Country A is a poor, developing country. Over the years, it has joined the International Monetary Fund (IMF), the World Bank, and the World Trade Organization. Times have not always been good for Country A, and in the last 10 years they have incurred a large trade deficit with their closest neighbor, who is its largest trading partner. In Country A, a leader was recently elected based on his campaign promise of eliminating the trade deficit, reducing poverty in the rural areas, improving the infrastructure of the country’s highways, and forming favorable trade. Which aspect of the International Monetary Fund (IMF) will assist the newly elected leader in paying the deficit, if agreed upon by both countries? a. The IMF loans money to member countries to solve trade deficit issues. b. The IMF functions like a bank for developing countries. c. The IMF focuses on development projects that support trade between countries. d. The IMF establishes well-defined borrowing requirements for all its members. Which critical distinction should Country A make when choosing between the World Bank and the International Monetary Fund (IMF) to improve the country's highways? a. The World Bank focuses on development projects. b. The IMF uses a quota system. c. The IMF has a commitment to international economic cooperation. d. The World Bank provides effective currency exchange between countries. Which benefit to the newly-elected leader in Country A stems from using the World Bank to meet a campaign promise? a. Receiving guidance on how to enact better financial controls b. Obtaining the funds needed to improve the country's infrastructure c. Stabilizing the country's currency valuation d. Paying off the trade deficit that the country has with its neighbor Why should the newly-elected leader of Country A be careful when working with the World Bank? a. Because the World Bank avoids addressing global issues b. Because of the voting power highly-developed countries have on World Bank policies c. Because the World Bank avoids poverty-related issues in the poorer countries d. Because middle-income countries are not eligible for funding from the World Bank Why should the newly-elected leader of Country A use the World Trade Organization (WTO) to form favorable trade agreements? a. To obtain funds to build the highway infrastructure b. To obtain funds needed to payoff their trade deficit with their neighbor c. To receive guidance on how to stabilize the country's currency d. To receive help building international trade capacity Unit 3 Country A exports more goods to Country B than it imports from Country B. Country A receives more monetary gain by using this practice. Which relationship does Country A have with Country B? a. Neo-mercantilism b. Mercantilism c. Protectionism d. Trade surplus ** Trade surplus is when a country exports more than it imports from another country. For example, China normally exports more manufactured goods to the United States than it imports from the United States. China has a trade surplus. Country A has been criticized by other countries for giving generous tax credits to its corn farmers, which enables the country's farmers to sell corn on the international markets for cheaper than all other countries. Which term is used by other countries to describe this practice? a. Mercantilism b. Free trade c. Trade surplus d. Government subsidies * Global strategic rivalry theory; Focuses on multinational corporations * Country similarity theory; Proposes intra-industry trade will be standard * Factor endowment theory; is based on a country’s natural resources * Free Trade; Occurs when there is little or no government tariffs, quotas, subsidies, or prohibitions to inhibit the exchange. * Import; purchasing goods or services from a foreign economy by a domestic economy * Export; shipping goods or services out of the port of a country * Protectionism; imposing tariffs on goods or services to safeguard industries What is a benefit of implementing a system of free trade? a. Increased tariffs would result in more revenue generated for the government. b. Reduced import quotas would result in more domestic sales due to scarcity. c. Reduced tariffs would result in lower costs of imported raw materials. d. Increased export quotas would result in more international sales of domestic goods. How are free trade agreements handled differently than treaties in the United States? a. Treaties must be approved by the Senate, whereas free trade agreements must be approved by the House of Representatives. b. Treaties must be approved by the Senate, whereas a free trade agreement must pass both houses of Congress. c. Treaties must be approved by the House of Representatives, while a free trade agreement only needs to be approved by the Senate. d. Treaties must be approved by both houses of Congress, whereas a free trade agreement only needs to be approved by the Senate. How do antidumping laws protect a domestic market? a. They restrict international companies from selling domestically. b. They prevent foreign companies from selling goods and services at or below cost. c. They prevent international companies from foreign direct investment. d. They restrict domestic companies from selling goods at prices above the price of production. A small clothing company based in California decided that it needed to have an application (app) and an updated website. Because this is a small company, it did not have the technological expertise to handle this improvement. The company hired a company based in Pakistan to handle its technology needs. Which common practice among companies is this an example of? a. Acquisition b. Merger c. Outsourcing d. Dumping Unit 3. Quiz) Sure Start Batteries 1. Which action illustrates how Sure Start is capitalizing on the comparative advantage of a country? a. Establishing a European headquarters in Germany and moving key leaders to that country b. Adding an office in the South American market to help manage the business throughout the continent c. Moving production of the batteries used in electric cars to Vietnam where labor is less expensive d. Expanding into Europe and Asia to supply batteries to electric car manufacturers in those markets 2. Which action of Sure Start represents the application of the global strategic rivalry theory? a. Adding an office in the South American market to help manage the business throughout the continent b. Expanding into Europe and Asia to supply batteries to electric car manufacturers in those markets c. Launching a new research division to focus on a rechargeable battery for use in electric cars d. Maintaining production with no investment in batteries for use in traditional vehicles 3. Which benefit will Sure Start gain from opening the factory in Vietnam? a. The move will allow them to be fully integrated in production of rechargeable batteries. b. They will achieve economies of scale in the production of rechargeable batteries. c. It will allow them to move to the production of electric cars in the near future. d. The U.S. government will give them subsidies for producing in Vietnam. 4. What will be the effect of the German trade policy on Sure Start's rechargeable batteries in its first year? a. Sure Start's profit for rechargeable batteries sold in Germany would increase. b. Sure Start will increase prices to German automakers. c. If the German automakers meet the domestic content requirement, there will be little impact. d. Sales to German automakers will increase. 5. The German Transportation Agency (GTA) halts imports of rechargeable batteries from Sure Start. Why would the GTA do this? a. To punish dumping behavior of Sure Start b. To protect the infant industry in Germany c. To respond to a product safety issue d. To respond to a national security issue Unit 4 Company A is located outside the home country of Company B. Company B has acquired Company A with the intent of controlling and managing Company A's assets. Which practice is being used by Company B? a. Partnership b. Portfolio investment c. Foreign direct investment d. Merger Why does a company engage in foreign direct investment? a. The company wants to identify another company with which it can partner. b. The company wants to control organizational assets in another country. c. The company wants to find a domestic source of financing for its foreign operations. d. The company wants to find a foreign source of financing for its foreign operations. Which strategy is used by governments to limit the foreign direct investment in a country? a. Decreasing the value of the country's currency b. Creating domestic ownership restrictions in the country c. Increasing the value of the country's currency d. Creating foreign ownership restrictions in the country Which activity is considered a foreign direct investment (FDI) by a multinational corporation? a. Providing guidance for franchises in the host country b. Providing guidance for franchises in the home country c. Setting up manufacturing plants in the host country d. Setting up manufacturing plants in the home country What is a reason for companies to engage in foreign direct investments? a. To take advantage of tax exemptions offered by the home country b. To increase imports to the home country c. To take advantage of tax exemptions offered by the host country d. To decrease imports to the host country Which country characteristic is most important to foreign direct investors according to a study by the World Bank? a. Low tax rates b. Macroeconomic stability and favorable exchange rate c. Political stability and security d. Access to land or real estate What is a benefit of foreign direct investment? a. The outflow of capital benefits the local but not global economies b. The inflow of capital benefits global and local economies c. The outflow of capital benefits global and local economies d. The inflow of capital benefits the local but not global economies What is the result of the existence of multinational businesses? a. Political separation of countries b. Political integration among countries c. Economic separation of countries d. Economic integration among countries What is a potential influence of the existence of multinational corporations (MNCs) on international relations? a. Creates international trade barriers b. Eliminates international trade barriers c. Worsens relations between countries where the MNC operates d. Improves relations between countries where the MNC operates What is an accurate characterization of the relationships between multinational corporations (MNCs) and the host country governments in which they operate? a. The relationships are negative because MNCs take resources from the host country. b. The relationships are mixed because MNCs can cause, but also solve, problems for the host country. c. The relationships are positive because MNCs provide jobs and capital to the host country. d. The relationships are mixed because MNCs cause economic strife in the host country Which level of economic integration presents an alliance of all policies by a common organization? a. Political union b. Free trade area c. Customs union d. Common market Which level of economic integration is formed when trade barriers are removed between member countries but there is no mutual policy on trading with nonmember countries? a. Political union b. Free trade area c. Customs union d. Common market Which level of economic integration permits the free movement of capital, labor and technology from member countries? a. Political union b. Free trade area c. Customs union d. Common market Which economic integration stage offers economic collaboration by removing trade barriers between member countries and establishing a mutual trading policy with nonmembers? a. Political union b. Free trade area c. Customs union d. Common market Which drawback is involved when regional agreements are created? a. Companies experience higher overall costs. b. Regions with higher economic development increase their gap over lower developed regions. c. Member countries will trade less with nonmember countries. d. Countries move production to more expensive labor markets in member countries. What is a benefit of creating a regional economic integration agreement? a. Less import potential b. Decreased competition c. Increased national cultural identity d. Improved financial growth What is an advantage of regional economic integration? a. Employment shifts preserve member countries' resources. b. Mergers and acquisitions encourage start-ups of small businesses. c. Continued discussions help nations gain additional political rights. d. Flexibility on labor movement develops job opportunities What is a disadvantage of regional economic integration? a. Integrated agreements among a small number of countries create conflicts. b. Labor movement restrictions narrow job opportunities. c. The exclusion of external countries reduces global free trade. d. A higher number of trades lowers growth rates in less-developed countries. Which agreement was implemented in 1994 and helped form a free-trade zone between Canada, the United States, and Mexico by decreasing tariffs and trade barriers? a. USMCA b. CAFTA-DR c. MERCOSUR d. NAFTA Which agreement was established in 1988 and now has both political and economic goals to keep peace and stimulates economic growth in South American countries? a. USMCA b. CAFTA-DR c. MERCOSUR d. NAFTA Which agreement was formalized in 1993 to create a political and economic union to help a large group of countries cooperate and coordinate key aspects of their economic policy? a. EU b. CAFTA-DR c. Mercosur d.ASEAN Unit 4. Quiz) A large Chinese furniture company is looking to move the production facility to offset high tariffs that have been placed on the import of furniture from China to the United States because the U.S. market is the largest consumer of furniture in the world. The strategy is to make a foreign direct investment into another country, such as the United States. 1. What is one option for the Chinese company to make a foreign direct investment (FDI)? a. Create a joint venture with a furniture company in Indonesia b. Merge with an even larger China-based multinational company c. Sell unfinished furniture to a company in Italy that will complete it d. Invest 5% in a furniture company in the US. 2. What is a benefit for making a foreign direct investment (FDI)? a. The investment will increase the Chinese company's risk of doing business internationally. b. An inflow of capital into the country chosen by the Chinese company will benefit the company. c. The country chosen by the Chinese company will increase jobs for local people. d. Profits will decrease for the Chinese company because it will avoid tariffs. 3. Which advantage will the company gain over other Chinese furniture companies if it becomes a multinational business through foreign direct investment? a. The company will be more competitive in the home country's furniture market. b. It will be able to avoid the tariffs that host countries have placed on furniture imports. c. There will be more risk of incurring higher costs in another country. d. It will be harder for them to exit the host country's market if sales begin to decrease. 4. Which stage of regional economic integration is represented by the North American Free Trade Agreement (NAFTA) that benefits the U.S. furniture company's production of covers in Mexico? a. Free trade area b. Customs union c. Common market d. Trade union 5. What is a drawback of the U.S. furniture company having its cut and sew operation in Mexico? a. There are three member countries in NAFTA, so it is more difficult for U.S. furniture companies to decide on policies. b. The number of U.S. furniture companies in Mexico are lower because of NAFTA. c. The U.S. company may forgo trade with another company producing covers for less because they are not part of NAFTA. d. There are fewer opportunities to do business with multiple furniture companies in Mexico. 6. Which economic benefit will result in the company's decision to move operations to the U.S. or Mexico? a. Increasing access to natural resources b. Eliminating tariffs and duties c. Implementing a country of origin rule d. Protecting intellectual property 7. How will the Chinese company recognize that it is more profitable to operate business in the United States from a foreign currency exchange perspective? a. The foreign direct investment in Chinese currency is restricted. b. The dollar is stronger than Chinese currency. c. The dollar is weaker than the Chinese currency. d.The regional trade bloc adopts one currency. Module 2) Test 1. Which effect does a command economy have on the process of globalization? a. The government encourages a free market, so the globalization process is accelerated. b. The economy is competitive, so the globalization process will be slowed. c. The government is less flexible, so the globalization process is challenged. d. The economy is self-sufficient, so the globalization process remains unaffected. 2. A company is conducting a legal risk analysis for a country that has a civil law system. Which statement accurately characterizes this legal system? a. It permits judges to interpret the law.(x) b. It is based on a detailed set of laws that form a code. c. It is a moral, not a commercial, system. d. It relies on the opinions of those well-trained in law. 3. Which fact should a company note when it opens its operations in the state of Louisiana? a. The state follows the canon law system. b. The state has a mixed law system. c. The state follows a Talmudic law system. d. The state follows a customary law system. 4. Which core principle of the World Trade Organization supports equality among member nations and helps fight discrimination among them? a. Multilateral trade agreements(x) b. Free trade c. Controlled tariffs d. Most-favored-nation (MFN) status 5. What is true regarding free trade? a. Free trade generates more losses than gains for participating countries b. Free trade leads to specialization of each country and increases production efficiency. c. Free trade generates manufacturing jobs in developed countries. d. Free trade is weakened when countries join regional economic integrations. 6. Countries A and B participate in trade agreements that allow free trade among participant countries. However, Country A imposed quotas on several imported products to protect its domestic products. What is the effect, if any, on the domestic prices of these products? a. Stays the same(x) b. Increases c. Decreases d. Cannot be determined 7. How do governments help companies offset the cost of manufacturing domestically? a. Anti-trust laws b. Subsidies c. Tariffs(x) d. Anti-dumping laws 8. What would a mercantilist value the most? a. Comparative advantage b. Factors of production(x) c. A trade surplus d. Absolute advantage 9. A multinational corporation has manufacturing facilities in many Asian countries due to cheaper labor. Which strategy is the corporation using? a. Market expansion b. Acquisition of resources c. Centralized portfolio management d. Realignment of capital expenditures 10. A firm in Country A exports products to Country B. The currency in Country B is strong relative to the currency in Country A. What does this mean for the firm? a. Increased domestic sales b. Less valuable export sales(x) d. More valuable export sales d. Decreased foreign sales 1. How is global business positively affected by intercultural exchange? a. It decreases the rate of change associated with industrial colonization. b. It increases the uniqueness of the national community. c. It decreases complexity to improve commercial identities. d. It increases worldwide connections that support commodity trading. 2. How does globalization support tolerance for different people and ideas? a. By strengthening protectionist tendencies b. By improving global wages c. By enhancing global morality d. By increasing the access to information 3. A business has recently started selling in a new global marketplace. Shortly after the company made this global expansion, the new country opted to implement ad valorem tariffs. How will this change affect the company? a. It will impose a value-added tax on corporate profits. b. It will levy a fixed tax on the goods imported. c. It will levy a tax based on the value of goods imported, causing this company to export less. d. It will provide increased corporate tax breaks. 4. Which business component does the TRIPS agreement help protect for member nations? a. Intellectual property protection for all member nations b. Policies that member nations use to conduct business in other member nations c. Standard transportation agreements between member nations d. Agreements between member nations to protect manufacturing patents 5. A business operating globally wants to increase its overall production efficiency. Which strategy should the business use? a. Improve trade regulations b. Enhance international relationships c. Maximize labor force d. Focus on specialization 6. The German government has imposed a specific tariff on T-shirts imported from Cambodia. How does this specific tariff affect the T-shirt producers in Germany? a. It protects German T-shirt producers. b. It decreases German T-shirt producers’ profit. c. It will decrease German T-shirt producers’ sales quantity. d. It does not have any impact on German T-shirt producers. 7. Countries A, B, and C have a trade agreement. Country C imposes high tariffs on all raw materials imported from Country A, and Country B imposes a lower tariff on the same raw materials imported from country A. What is the effect of this set of actions on these countries? a. Country A will do more business with Country C. b. Country A will do the same amount of business with Country B and Country C. c. Country A will cease doing business with Countries B and C. d. Country A will do more business with Country B. 8. A multinational corporation (MNC) in a country with a strong labor union is seeking to move its production facility overseas. Which factor is a benefit of this action? a. Decreasing labor costs b. Overcoming competitive intensity in the industry c. Identifying new markets overseas for new customers d. Moving away from regulatory issues related to operations 9. What is enhanced when creating regional trade agreements? a. Global trade integration b. National cultural identity c. Labor restrictions d. Economic opportunity 10. A firm based in Country A exports products to Country B. The currency in Country A is stronger than the currency in Country B. Which strategy should the firm use to maximize profits? a. Increase domestic sales and reduce its exports to Country B b. Increase the selling price of domestic sales c. Reduce domestic sales and increase its exports to Country B d. Reduce the selling price of foreign sales Module 3 Which is not a mandate that companies with corporate social responsibility strive to achieve? a. Treat its employees with dignity and respect b. considers the impact of their actions on the environment c. Provide a quality product or service to its customers. d. Fairly deal with suppliers e. do whatever it takes to be profitable GCD industries employs a set of internal controls within its operations to help ensure ethical behavior and to help prevent financial impropriety. Which one of the following is least likely to be used as an internal control by the company? a. Corrective actions are taken immediately whenever a department goes over its budget b. Adequate and accurate documentation and records are maintained c. Financial and accounting records are periodically audited d. All funds due the company and all checks for expenditures are handled by the same person e. The company has written policies and procedures for all members to follow A farmers’ market has many vendors and consumers who all sell and buy the same produce at the same price. Which type of market is represented? a. Oligopoly b. Perfect competition c. Monopolistic competition d. Monopoly A sole, national telephone company was found violating antitrust laws and was forced to separate into regional companies. What caused the violation of the antitrust laws? a. Service disruptions b. Increased profits c. Technological innovation d. Reduced competition Many countries from several geographic regions are accused of dumping steel into the U.S. market at unfairly low prices. Which entity can the United States appeal to correct this apparent market manipulation? a. World Trade Organization b. World Bank c. European Union d. International Monetary Fund Which of these agreements or treaties was to combat increased temperatures of global climate change? a. Versailles b. Maastricht c. Antarctic d. Paris Which governmental entity was created to provide regulatory authority regarding pollution by industry? a. Department of Commerce b. Department of Agriculture c. Environmental Protection Agency d. Federal Bureau of Investigation Which type of duty is required to take care of the collective environment across the nation? a. Assigned b. Shared c. Individual d. Customs What makes the enforcement of United Nations Environmental Program regulations difficult? a. World Food Program distributions b. Sovereign rights of nations c. Pure competitive markets d. Peacekeeping missions of nations Which action is used by companies wishing to avoid working with vendors who use sweatshops? a. Developing and imposing a company internal code of conduct for vendor labor practices b. Establishing national child labor laws and requiring vendors to comply with them c. Allowing vendor practices to be flagged by nongovernmental organizations such as the National Labor Committee d. Sending a whistleblower to the job sites to ensure the vendor practices safe working conditions A major footwear brand company is contracting the manufacturing of its products to a contractor’s manufacturing plant overseas. The footwear company has been accused of turning a blind eye to sweatshop practices at other overseas contract locations before. How should the footwear company ensure that the contractor will comply with the standards set forth in the code of conduct that explicitly prohibit this practice? a. Restrict authorization to daytime shifts b. Require that the factories be available for inspections c. Require the contractor to self-report compliance on a monthly basis d. Prohibit the use of worker overtime What did the Worst Forms of Child Labor Convention, 1999 define? a. Hourly wage rates b. Rights for domestic workers c. The age at which a person becomes an adult d. Rules of workplace of safety Which convention protects decent working hours for a cruise ship director who travels in international waters? a. Maritime Labor Convention, 2006 b. Forced Labor Convention c. Equal Remuneration Convention d. Domestic Workers Convention, 2011 Which result occurs when a legally enforceable contract between two businesses from different countries is broken? a. The party who has been affected can seek damages. b. The broken contract impacts political policy making. c. Resolution of the contract must be secured in 90 days. d. The party who broke the contract cannot sell goods. Which two primary sources of law govern contracts in the United States? a. The UN Convention on Contracts for the International Sale of Goods and a vertical structure b. The common law and U.S. Supreme Court c. The UN Convention on Contracts for the International Sale of Goods and a horizontal structure d. The common law and the Uniform Commercial Code How is contract law structured as it applies to global business among nations? a. Vertical b. Arbitral c. Horizontal d. Tribunal Which condition is part of a contract between international companies that are based in different nations? a. A clause against unfair contract terms b. A structure that is vertical in nature c. A provision against arbitration clause d. A choice of law clause Which intellectual property right describes a chemical company's filing on their innovative industrial process invention? a. Trademark b. Patent c. Service mark d. Copyright Which organization aims to develop a global intellectual property infrastructure? a. WRC b. WTO c. WIPO d. TRIPS What is the agreement that the World Trade Organization has between its member nations that governs all intellectual property laws? a. World Intellectual Property Organization (WIPO) b. Trade-Related Aspects of Intellectual Property Rights (TRIPS) c. United States Trade Representative (USTR) d. Alternative Dispute Resolution (ADR) Module 3) Test The Garbus company is a producer of microprocessors made with precious metals mined in Central America and is headquartered in the southwest United States. It is one of a few producers of the microprocessors that are used in the onboard computers of luxury automobiles. In the past year, it has outgrown its competitors and is looking at acquiring the next three largest competitors, who are in Europe. One of the companies that Garbus would like to acquire in the Czech Republic is under investigation for operating a sweatshop. It is suspected of having employees younger than 17 who work long hours each day. If it can complete the acquisitions, it will be able to dominate the global market for these microprocessors. The precious metals used in the microprocessors produce waste that can be toxic to the environment. Garbus wants to be an environmentally friendly company. It works closely with the Environmental Protection Agency (EPA) to ensure that all waste is disposed of properly. However, some managers in the company are concerned that if they adhere to the guidelines of the EPA, they could be limiting their productivity. The mining company in Costa Rica that provides some of the precious metals to Garbus has decided to renegotiate its contract with Garbus because it has heard of Garbus’ desire to acquire its competitors. It wants to include a provision that will require Garbus to continue to purchase precious metals for the next three years. Garbus agrees, but adds a choice of law clause that requires any contract disputes to be handled in the United States. In addition to the production of the microprocessor, Garbus has intellectual property associated with the design of the microprocessor. It regularly has its legal team search for infringements of the patents that it holds for the design. If the legal team finds something in another country that infringes on the patents, it works with the World Intellectual Property Organization (WIPO) to settle any disputes. 1. Why does the European Union (EU) have a concern about the acquisitions of the Garbus company? a. The jobs in EU countries would be eliminated. b. The acquisitions would create a trade deficit with the United States. c. Garbus will be able to unfairly raise prices. d. Garbus will be more efficient in production than other companies in Europe. 2. Why is the EPA assisting Garbus with ensuring its waste is disposed of properly? a. The EPA's mission is to help businesses in stopping environmental deterioration. b. The EPA ensures that global trade is not affected by environmental laws. c. The EPA's assistance is mandated by the U.S. Department of Labor. d. The EPA provides a free resource to companies to help them save money. 3. Which convention addresses the issue regarding the company that Garbus would like to acquire but is under investigation for operating a sweatshop? a. Worst Forms of Child Labor b. Maritime Labor c. United Nations Framework d. Domestic Workers 4. Why does Garbus want to include a choice of law clause in the contract? a. The Uniform Commercial Code requires that the clause is included in contracts. b. It specifies which law applies to any disputes that could arise under the contract. c. Garbus would be able to breach the contract easier. d. Garbus is not familiar with the contract laws of Costa Rica. 5. Which type of law is applicable if Garbus contracted with another company to handle the disposal of its waste from its production plant and the waste accidentally leaked into a local water source? a. Labor b. Antitrust c. Environmental d. Contract 6. Why is the World Intellectual Property Organization (WIPO) used to help protect intellectual property? a. It can solve any international business dispute. b. It encourages the trade of intellectual property in the global market. c. It offers alternative dispute resolution to mediate disputes over intellectual property. d. It can direct the local governments to resolve the dispute. Module 4 Sobel sodas is a US company that specialized in the production of carbonated beverages. They are considering expansion to other countries. In conducting their expansion research, Sobel Sodas has determined that the tastes and flavor preferences in other countries are vary different from one another. Which organizational structure would best serve the needs of Sobel Sodas as they expand to other countries? a. Functional - based on specific skills or tasks b. Divisional – product, region, or market c. Matrix – by function and division d. Teams – complimentary skills, competitions. Sobel sodas is a US company that specialized in the production of carbonated beverages. They are considering expansion to other countries. In conducting their expansion research, Sobel Sodas has determined that the tastes and flavor preferences in other countries are very different from one another. Which organizational structure would best serve the needs of Sobel Sodas as they expand to other countries? a. Geographic – (sub of divisional) regions or geographical areas/ the most specific reason, best answer for the question. b. Divisional c. Market – (sub of divisional) customer types d. Product – (sub of divisional) different products of the following, which is Not an advantage of the functional structure? a. It promotes economies of scale b. It promotes in-depth skill development of employees c. It ensures that organizations will engage in socially responsible efforts. => not related with organizational structure. d. It encourages collaboration, efficiency, and quality within the function. A defense contractor may need deep functional skills as well as the ability to coordinate across the functions for each contract or project. This contractor ought to use a structure. a. Functional - based on specific skills or tasks b. Product – (sub type of divisional) c. Matrix – by function and division d. Teams – complimentary skills, competitions. Which of the following are disadvantage (s) of the Teams organizational structure (select all apply)? a. Innovation (advantage) b. Tunnel vision (disadvantage of functional structure) c. Interpersonal conflict d. lack of motivation Which of the following correspond to decentralized decision making (select all apply)? a. employee feel more secure (centralization) b. Inconsistent decision-making c. Flexibility to meet local needs d. Consistency of processes and output(centralization) e. Decisions are made at higher levels in the organization(centralization) f. employees feel more empowered Sobel Sodas has entered a foreign market. After being there for some time the market has become saturated with competitors. Sobel Sodas is facing significant cost pressure. As a result, the company is trying to achieve economies of scale through standardization while also responding to the local and unique taste preference. Which strategy best describes Sobel Sodas? a. Standardization b. Exporting c. Transnational d. Multidomestic Sobel Sodas would like to expand to foreign markets. They have decided to use licensing (IP; Licensor sells rights to IP to licensee) as their entry strategy. Which of the following are true? (select all that apply) a. Sobel Sodas has no upfront investment b. The licensor will pay an annual fee (= Licensee will pay) c. Sobel Sodas will provide specialized equipment to the licensee (franchise) d. Sobel Sodas will help with some of the startup costs (franchise) e. Sobel Sodas will provide the intellectual property to the licensee f. The licensor will help with pricing and marketing (franchise) A challenge faced by strategic alliances is that a. they involve the creation of a separate entity with joint ownership (joint venture) b. environmental sustainability is difficult to achieve c. any member could prematurely quit the alliance d. they are not especially focused on enhancing revenues e. they are illegal in the most international markets KFC sells several core items around the world, but offers other items tailored to specific markets. KFC is following an strategy. a. Standardization; (same item) b. Adaptation(modification) c. Marketing d. Glocalization (standardization + adapt when necessary) e. export A business has decided to expand and become a multinational enterprise. Which of the following reasons should influence the business to take this step? a. To create a regional integration bloc (= country level agreement) with the host country b. To create economic infrastructure in the host country c. To increase risk d. to gain access to lower resource costs in the host country of the following, which dimension identified by Hofstede refers to the level of egalitarianism in a society? a. Individualism vs collectivism b. Power distance c. Masculine vs feminine d. Uncertainty avoidance e. Internal control vs external control According to Hofstede, the US is considered a(n) a. authoritarian country b. collectivist country c. high power distance country d. feminine country e. high individualistic country Which of the following countries would be appropriate for a performance evaluation to be conducted at the individual level as opposed to the group level? a. Denmark b. Japan c. Mexico d. China A Multi-national corporation headquartered in the US is starting a new operation in India. They have to fill the management positions at the India location with individuals from their home office. Which of the following best describes their management at the india location? a. Patriots b. Third-country Nationals c. Expatriates d. Host-country Nationals e. Home basing A Multi-national corporation headquartered in the US is starting a new operation in India. They have to fill the management positions at the India location with individuals from their home office. Which of the following best describes their HRM and Staffing strategy? a. Anthrocentric b. Ethnocentric c. Polycentric d. Globocentric e. Geocentric A Multi-national corporation headquartered in the US is starting a new operation in India. They have to fill the management positions at the India location with individuals from their home office. Which of the following is not a disadvantage of their staffing and HRM strategy? a. Flexibility to adjust to local conditions. b. Lack of diversity c. the large potential for management attrition d. Lack of motivating of local employees. An international company has created a diagram to show the division of labor between departments. What is the name of this diagram? a. Organizational chart b. Flowchart c. Horizontal linkages d. Vertical linkages An international company wants to establish links between the people at the same level of the organization to form committees. What is the name for this type of link in a company? a. Vertical b. Horizontal c. Contractual d. Cooperative Managers in an international company are arranging jobs so similar tasks are coordinated. Which activity is being completed by this company? a. Delegation b. Aggregation c. Departmentalization d. Segmentation Managers at an international business are deciding the method by which it will be organized. The business is highly diversified, manufacturing a number of different components and parts for its industrialized customers. Which departmentalization structure should be used by this company? a. Product b. Market c. Geographic d. Functional Functional; Uses a traditional type of organizational structure with silos Product; Promotes efficiency in production lines Market; Focuses on distinct customer needs Geographic; Allows for adaptation to the local needs for a multinational corporation Matrix; Allows for specialization Teams; Increase creativity and productivity An employee feels empowered to make decisions to solve customer problems independent of seeking manager approval and uses flexibility to meet customer needs. Which decision-making structure is being used by this employee? a. Matrix b. Decentralized c. Functional d. Centralized A fast food company seeks to expand internationally and changes its menu to appeal to the new country's food tastes. Which action is being sought by the company by making this change? a. Local responsiveness b. Economy of scope c. Global integration d. Economy of scale A company wants to gain market share but does not want to establish operations in other countries nor tailor its products to the other countries. Which entry strategy should the company use to meet this goal under these conditions? a. Transnational b. Export c. Multidomestic d. Joint venture A car company wants to expand internationally but encounters much international competition to reduce cost while responding to local needs. Which strategy should the company use to meet this goal under these conditions? a. Communication b. Export c. Web d. Transnational Module 4 Quiz) Stanley & Sons is based in the United States and produces performance fabrics that are used in the construction industry. Its products have been revolutionary for enabling construction companies to build highways in mountainous areas, mostly in the U.S. and Canada. The company was started 15 years ago in North Carolina by Jack Stanley and his two sons. For the past two years, the growth of their company has encouraged them to think about restructuring in order to meet increasing demand for their products. Currently, the company produces 10 types of fabrics that help with soil erosion, which is a by-product of highway construction. The processes used to manufacture the different types of fabric are mostly the same, and Jack and his sons handle most of the business decisions. The company employs 50 workers on the production floor that is overseen by Jack and his sons. Because everything funnels through Jack and his sons, they are feeling overwhelmed, and the company is not being as efficient as it needs to be. Stanley & Sons wants to departmentalize employees into functions. In addition to figuring out the best organizational structure, Stanley & Sons is contemplating which steps to take to grow the company outside of the U.S. and Canada. Stanley & Sons is thinking about starting up a new manufacturing facility in Germany and is considering using a centralized decision-making method at that location. They are not sure if they should incur large amounts of debt in order to open a facility in Germany or if they should go in a different direction. They believe that providing their products to construction companies in Germany will lead to further international growth. Stanley & Sons is considering using an international standardization business strategy. 1. Which organizational structure is appropriate for forming the departments for Stanley & Sons? a. Matrix b. Divisional c. Functional d. Teams 2. Which structure is Stanley & Sons using to control the structural hierarchy at a low level? a. Flat structure b. Matrix structure c. Functional structure d. Tall structure 3. What is an advantage of using the decision-making method proposed for a facility in Germany? a. Business would be flexible to meet local needs. b. Employees would feel empowered. c. Operations would be customer-centered. d. Decision-making processes would be consistent. 4. Which business strategy should Stanley & Sons use to meet goals if leaders choose not to create an international division in Germany but they would still like to serve German customers? a. Standardization b. Export c. Multidomestic d. Transnational 5. What is the effect on global integration and local responsiveness if Stanley & Sons chooses to use an international standardization business strategy? a. High global integration and low local responsiveness b. High global integration and high local responsiveness c. Low global integration and high local responsiveness d. Low global integration and low local responsiveness A company decides to focus on economies of scale to decrease production costs and increase revenues. Why is this strategy effective? a. Ordering in small quantities ensures that shipping costs stay low. b. Manufacturing in large quantities keeps costs low. c. Ordering in large quantities takes advantage of bulk pricing. d. Manufacturing in small quantities minimizes operational costs. When expanding internationally to a country with a lower average income, a company made efforts to reduce the price of its product, even though it eliminated some of the benefits the product has in other markets. This allowed for greater sales in the new market. Which strategy is being used by this company? a. Standardization b. Adaptation c. Multibrand d. Global A company owner is considering manufacturing using a global standardization strategy to achieve economies of scale. Why is this strategy effective? a. It manufactures the same product for all markets. b. It decreases shipping costs. c. It ensures product safety is maintained. d. It improves manufacturing processes. A company has decided that a foreign direct investment should be made during the next quarter to strengthen the organization. Which method should be used for this purpose? a. Establishing a greenfield venture b. Exporting c. Establishing a joint venture with another company d. Licensing An individual is considering entering the global market via a franchise. Which outcome should be expected by the individual if this approach is used? a. Majority of financial risk b. Limited access to the franchiser’s brand and trademarks c. Low access to advertising and product training d. Limited name recognition Quiz) Azamar Inc. is a manufacturer of area rugs in Dalton, Georgia. The company wants to expand into international markets and decides to focus on Italy first. The chief executive officer (CEO) of the company prefers to enter this new market as quickly as possible. The chief financial officer (CFO) wants to ensure that the risks of entering into the new market are understood so they can be managed within a tolerable limit, and the chief operating officer (COO) has concerns over shipping times and freight costs from the United States to Italy. Because of the high concentration of apartments in most Italian cities, Azamar has decided that the largest area rug to be offered in the Italian market will be 6ft x 9ft, and most of the Italian company's rugs will be 5ft x 7ft. In the United States, the largest size is 12ft x 12ft, and the most popular size is 9ft x 10ft. 1. Which approach will save costs through a quick entry by Azamar? a. Acquisition b. Greenfield c. Partnering d. Franchising 2. Which marketing strategy is being used when Azamar decides to offer smaller sizes in the new country? a. Glocalization b. Brand recognition c. Standardization d. Product adaptation 3. Azamar discovers that there are import restrictions on area rugs in Italy. Which low-risk strategy should Azamar use to enter this foreign market? a. Licensing b. Integration c. Acquisitions d. Joint ventures 4. Which factor is a risk for Azamar if it decides to export its area rugs to Italy through a distributor? a. The manufacturer will lose control over the quality of the area rugs being exported to Italy. b. The distributor could switch to cheaper supplier of area rugs to get better prices. c. The manufacturer and distributor will have to share profits with other Italian companies. d. The manufacturer would take too long to develop the operation processes to be successful. 5. Why would Azamar want to expand business outside of the United States and into Italy? a. To diversify transportation costs b. To reduce diversification of operation c. To support market growth d. To increase operating expenses A country's corporate culture requires that most of the decisions be made by senior management, and entry-level positions are viewed as having much less status and respect. Which of Hofstede's cultural dimensions is being used by this country? a. Long-term orientation b. Uncertainty avoidance c. Restraint d. Power distance A country that values spontaneity and freedom to satisfy human desires provides its citizens business opportunities to prosper in these areas. Which of Hofstede's cultural dimensions is the country exhibiting? a. Power distance b. Long-term orientation c. Indulgence d. Masculinity A U.S. employee believes that each individual is responsible for one's own success and finds it challenging to work in cultures that emphasize collaborative approaches to decision-making. Which aspect of Hofstede's cultural dimensions is exemplified by this employee? a. Individualism b. Power distance c. Long-term orientation d. Uncertainty avoidance John is the president of a company that is based in Atlanta. This company, which manufactures office items that stick to walls, furniture, and other items, has been very successful in its first five years, so John decides that he would like to expand the business globally and has chosen to start in the Philippines. What is one of the first things he should do? a. Talk to the local people in the Philippines b. Email the local government in the Philippines c. Conduct a market survey in the Philippines d. Research the history and politics of the Philippines A company's chief executive officer (CEO) wants to expand the company into China and is reviewing the Chinese word guanxi, the basis of all business in that country. Which English meaning must the CEO understand in regards to this Chinese concept? a. The die is cast. B. If God is willing. C. All is well that ends well. D. You owe me one Which Latin American phrase (translated into English) typifies how time is viewed, which can make conducting business frustrating to Northern European companies seeking to expand in Latin America? a. Time is money. b. Time is circular. c. Time is space. d. Time is a social construct A chief executive officer (CEO) of a Scandinavian company sought to expand operations in Japan through a joint venture. When the CEO asked the Japanese business owner whether she was committed to the venture, the business owner responded with a flat-toned "yes." The outcome the CEO expected did not happen, and the joint venture failed. What was the CEO's misinterpretation in this communication? a. The response indicated agreement. b. The response indicated possibility. c. The response indicated misunderstanding. d. The response indicated excitement A company's chief executive officer (CEO) emphasizes to other executives in the foreign country's joint venture that the CEO's culture should take precedence over other cultural systems since it is superior. Which type of viewpoint is the CEO demonstrating regarding culture? a. Individualism b. Uncertainty avoidance c. Power distance d. Ethnocentrism A company wants its expatriates to receive the best training to adapt to the local environment in the host country. What is the goal of this training? a. Cultural homogeneity b. Cultural agility c. Obeying local law d. Making a profit A company is considering establishing a subsidiary in a new host country and wishes to prepare its expatriates to adapt to the local environment. How should this company prepare its expatriates? a. Operational training b. Repatriation c. Cultural training d. Negotiation An employee has assumed an expatriate role and is studying textbooks to learn about cultural differences in order to function smoothly in the new setting. Which helpful secondary source training is the expatriate using? a. Cultural simulation b. Documentary c. Field simulation d. Foreign language An employee who is scheduled to become an expatriate has successfully passed the survival training stage. What type of training is used by the company after passing this stage? a. Documentary b. Field simulation c. Cultural simulation d. Workshop A company operating in a foreign country hires and conducts business according to the cultural practices in its home country. Which approach to human resource management is used by this company? a. Geocentric b. Monocentric c. Ethnocentric d. Polycentric A company would like to use a human resource approach that leads to more fluid movement among employees and creates diversity in the workforce. Assignment decisions are made jointly by the headquarters and the field offices. Which human resource approach should be used by this company? a. Polycentric b. Multicentric c. Geocentric d. Ethnocentric What is the term for the services a company provides when it helps an employee who has worked in a host country make the transition back to the home country? a. Orientation b. Repatriation c. Documentary training d. Field training Module 9 Quiz) 1. Employees in the Vietnam office that are hired locally seek to achieve common goals and are loyal to each other. Which of Hofstede's cultural dimensions is this office low in? a. Power distance b. Individualistic c. Long-term orientation d. Indulgence 2. What can Charlie expect to encounter among the employee dynamics in the various international locations? a. Individuals believe that using time efficiently is equal to increased profits. b. Individuals expect business meetings to begin on time. c. Personal values are based on one's home country cultural norms. d. Offering flexible work schedules shows a lack of respect. 3. What type of in-depth training will Carl Spith and Kim Arkle most quickly benefit from before leaving the United States to their new host countries? a. Field training b. Self-guided learning c. Cultural simulation d. Documentary 4. All hiring decisions will be made in the international markets using policies and procedures applicable to those locations without home office oversight. Which approach to human resource management aligns with this decision? a. Geocentric b. Regiocentric c. Polycentric d. Ethnocentric 5. Which component of training by the human resource department will help Carl Spith and Kim Arkle understand the norms of Vietnam and Germany? a. Repatriation b. Culture c. Language d. Goal setting Unit 4 Quiz) An international company has employees with complementary skill sets work together toward a mutual goal. What is the organizational structure of this company? a. Divisional b. Functional c. Teams d. Matrix Which departmentalization is based on the primary roles performed within an organizational unit, such as marketing, finance, production, and sales? a. Process b. Geographic c. Functional d. Customer A business has decided to engage in foreign direct investment (FDI). Which reason should influence the business to take this step? a. To create a political alliance with the host country b. To establish business policy in the host country c. To increase economic development in the host country d. To take advantage of lower costs in the host country A chief executive officer (CEO) wants to grow the company by investing in foreign countries. The CEO is considering multiple entry strategies to accomplish this objective but has concerns about growth in foreign markets, especially the costs, risks, and entry time. The CEO would like to eliminate any en