CBA300 Final Exam Study Guide
Overview
Absolute Advantage - ANSWER The ability of a country to produce a product more
efficiently than any other country.
Ethical Systems - ANSWER Set of moral principles, or values, that are used to guide and
shape behavior.
Law/Legal Systems - ANSWER Three: Common law, Civil law system, Theocratic law
systems.
Theocratic Law Systems - ANSWER Legal systems based on religious teachings.
Voluntary Export Restraint - ANSWER An example of the Japanese government limiting
vehicle exports to the United States in 1981.
Sourcing Goods and Services - ANSWER The act of obtaining goods and services from
rival global companies to lower costs or improve quality.
Porter's Value Creation - ANSWER Creating superior value by driving down cost
structure and/or differentiating the product.
Ethnocentric Staffing Approach - ANSWER A staffing approach that seeks host-country
nationals for all key positions.
Polycentric Staffing Approach - ANSWER A staffing approach that seeks the best people
for key jobs regardless of nationality.
Corporate Culture - ANSWER An organization's norms and value system.
Collectivism A central message that individual economic and political freedom are the
ground rules for society.True or False - ANSWER False
Comparative Advantage - ANSWER The ability to produce a good or service at a lower
opportunity cost than any other producer.
Business Environment for Low Growth - ANSWER Must be conducive to investment,
R&D, and entrepreneurial activity.
Corruption in International Business - ANSWER Making payments to corrupt
government officials can result in economic advantages.
Ethnocentric Staffing Policy - ANSWER A policy where a multinational company staffs all
, key positions in foreign operations with managers from its home country.
World Bank Loans - ANSWER The World Bank may offer low-interest loans to
underdeveloped nations despite poor credit unions.
Currency Swap - ANSWER The simultaneous purchase and sale of a given amount of
foreign exchange for two different value dates.
Globalization of Markets - ANSWER The merging of historically distinct and separate
national markets into one huge global marketplace.
Globalization of Production - ANSWER Sourcing goods and services globally to take
advantage of national differences in cost and quality.
Drivers of Globalization - ANSWER Technological advancements in communication,
information processing, and transportation technologies.
Declining Trade and Investment Barriers - ANSWER Post-World War II, there has been a
significant reduction in barriers to the free flow of goods, services, and capital, enabling
firms to expand internationally.
Jobs and Income - ANSWER While globalization can lead to job creation in developing
countries, it may also result in job losses in developed countries as companies move
production to lower-cost locations.
Labor Policies and the Environment - ANSWER Concerns arise over the exploitation of
labor and environmental degradation in countries with lax regulations.
National Sovereignty - ANSWER Globalization can lead to a loss of sovereignty as
countries become more interdependent and subject to international regulations and
agreements.
Collectivism - ANSWER A system that emphasizes collective goals over individual goals.
Advocated by Plato, it translates into an emphasis on socialism and communism in the
modern context.
Individualism - ANSWER A philosophy that emphasizes individual freedoms in the
political, economic, and cultural realms. Associated with Aristotle, it underpins
democratic and free-market systems.
Democracy - ANSWER A political system in which government is by the people,
exercised either directly or through elected representatives.
Totalitarianism - ANSWER A form of government in which one person or political party
exercises absolute control over all spheres of human life and prohibits opposing
political parties.
Market Economy - ANSWER All productive activities are privately owned, and
production is determined by the interaction of supply and demand.
Overview
Absolute Advantage - ANSWER The ability of a country to produce a product more
efficiently than any other country.
Ethical Systems - ANSWER Set of moral principles, or values, that are used to guide and
shape behavior.
Law/Legal Systems - ANSWER Three: Common law, Civil law system, Theocratic law
systems.
Theocratic Law Systems - ANSWER Legal systems based on religious teachings.
Voluntary Export Restraint - ANSWER An example of the Japanese government limiting
vehicle exports to the United States in 1981.
Sourcing Goods and Services - ANSWER The act of obtaining goods and services from
rival global companies to lower costs or improve quality.
Porter's Value Creation - ANSWER Creating superior value by driving down cost
structure and/or differentiating the product.
Ethnocentric Staffing Approach - ANSWER A staffing approach that seeks host-country
nationals for all key positions.
Polycentric Staffing Approach - ANSWER A staffing approach that seeks the best people
for key jobs regardless of nationality.
Corporate Culture - ANSWER An organization's norms and value system.
Collectivism A central message that individual economic and political freedom are the
ground rules for society.True or False - ANSWER False
Comparative Advantage - ANSWER The ability to produce a good or service at a lower
opportunity cost than any other producer.
Business Environment for Low Growth - ANSWER Must be conducive to investment,
R&D, and entrepreneurial activity.
Corruption in International Business - ANSWER Making payments to corrupt
government officials can result in economic advantages.
Ethnocentric Staffing Policy - ANSWER A policy where a multinational company staffs all
, key positions in foreign operations with managers from its home country.
World Bank Loans - ANSWER The World Bank may offer low-interest loans to
underdeveloped nations despite poor credit unions.
Currency Swap - ANSWER The simultaneous purchase and sale of a given amount of
foreign exchange for two different value dates.
Globalization of Markets - ANSWER The merging of historically distinct and separate
national markets into one huge global marketplace.
Globalization of Production - ANSWER Sourcing goods and services globally to take
advantage of national differences in cost and quality.
Drivers of Globalization - ANSWER Technological advancements in communication,
information processing, and transportation technologies.
Declining Trade and Investment Barriers - ANSWER Post-World War II, there has been a
significant reduction in barriers to the free flow of goods, services, and capital, enabling
firms to expand internationally.
Jobs and Income - ANSWER While globalization can lead to job creation in developing
countries, it may also result in job losses in developed countries as companies move
production to lower-cost locations.
Labor Policies and the Environment - ANSWER Concerns arise over the exploitation of
labor and environmental degradation in countries with lax regulations.
National Sovereignty - ANSWER Globalization can lead to a loss of sovereignty as
countries become more interdependent and subject to international regulations and
agreements.
Collectivism - ANSWER A system that emphasizes collective goals over individual goals.
Advocated by Plato, it translates into an emphasis on socialism and communism in the
modern context.
Individualism - ANSWER A philosophy that emphasizes individual freedoms in the
political, economic, and cultural realms. Associated with Aristotle, it underpins
democratic and free-market systems.
Democracy - ANSWER A political system in which government is by the people,
exercised either directly or through elected representatives.
Totalitarianism - ANSWER A form of government in which one person or political party
exercises absolute control over all spheres of human life and prohibits opposing
political parties.
Market Economy - ANSWER All productive activities are privately owned, and
production is determined by the interaction of supply and demand.
