Global Marketing Test Questions with Correct Answers 100% Pass
What is Global Marketing? - Answers The performance of business activities that direct the flow of a
company's goods and services to consumers or users in more than one nation for a profit
Why is Global Marketing Different? - Answers It generates new organizational challenges.
G-7 - Answers USA, Germany, UK, France, Japan, Canada, Italy
BRIC - Answers Brazil, Russia, India, China
N-11 - Answers Bangladesh Egypt Indonesia Iran Korea Mexico Nigeria Pakistan Philippines Turkey
Vietnam
What are emerging markets? - Answers Countries restructuring their economies along market- oriented
lines, offering opportunities in trade, technology, transfer & foreign direct investment.
Nokia in India - Answers Had 60%+ Market Share in India, Shifted R&D and manufacturing to India,
Product development and marketing 100% planned and executed by local teams (in weeks, not
months!) Employees empowered to criticized management decisions... and to contribute ideas to
improve performance
Decision to Go Global Affected by: - Answers Company Influences Industry Influences Market Influences
Proactive - Answers Profit and growth goals, Managerial urge, Technology competence/ unique
product/brand, Economies of scale/ Learning curve effects, Foreign market opportunities/market
information, Tax benefits, Proximity to international customers/psychological distance
Reactive - Answers Competitive pressures, Domestic market: small and saturated,
Overproduction/excess capacity, Unsolicited foreign orders, Extend sales of seasonal products
Economies of Scale - Answers a proportionate saving in costs gained by an increased level of
production."mergers may lead to economies of scale"
Learning Curve Effects - Answers In management, models of the learning curve effect and the closely
related experience curve effect express the relationship between equations for experience and
efficiency or between efficiency gains and investment in the effort.
Reactive Motives - Answers Competitive Pressures-anticipating future cost disadvantages because of
first mover advantages, small or saturated domestic markets; overproduction
Internal Triggers - Answers Perceptive Management/personal networks, Specific Internal Event,
Importing as inward internationalization
External Triggers - Answers Market Demand, Competing Firms, Network Partners, Outside experts,
Banks, Governments, Outside Experts, Chambers of Commerce
, Why are Triggers and Motives different? - Answers Motives should be viewed as certain attitudes
towards internationalization"-answers why the firm would like to go abroad, Triggers are change agents
that make firms go ahead, the same trigger might influence companies with different motives
Barriers to Global Expansion - Answers Insufficient finances, insufficient knowledge & finance. Lack of
foreign market connections, Lack of export commitment, Lack of capital to finance expansion into
foreign markets, Lack of productive capacity to dedicate to foreign markets, Lack of foreign channels of
distribution, Management emphasis on developing domestic markets, Cost escalation due to high export
manufacturing, distribution and financing expenditures
General market risks - Answers Competition from other firms ,Language and cultural differences
Commercial risks - Answers Exchange rate fluctuations, Failure of export customers to pay due to
contract disputes, bankruptcy, refusal to accept product or fraud
Political risk - Answers High foreign tariffs on imported products , Confusing foreign import regulations
and procedures, Civil strife, revolution and wars disrupting foreign markets
Hidden Costs of Internationalization - Answers Bias against foreign companies in advanced economies,
customers use global activity as a basis for inferences about quality and social responsibility
Uppsala model - Answers Saw internationalization process as gradual and involving progression along an
"establishment chain" of increasing commitment and also into psychically more distant markets
4 Stages of Uppsala - Answers 1. No regular exports-No active cultivation of foreign customers 2. Export
via independent representatives -Devoted exports 3. Establishment of a foreign sales subsidiary-‐
Interaction with foreign customers 4. Foreign production/manufacturing subsidiary- ‐Greater
involvement with foreign customers
Perspective of the Uppsala model - Answers • Market commitment consists of two factors - Amount of
resources commited - Specificity of resource commitment • Importance of knowledge - General market
knowledge - Market-‐specific knowledge • The greater the knowledge, the greater the commitment will
be • Key message of the Uppsala Model: Internationalization is a slow, time- ‐consuming and iterative
process
Benefits of the Uppsala model - Answers • Clarifies the level of investment commitment and risk
involved in different modes of operation • Shows the relationship between these different influences on
international investments • Describes the internationaliza;on process of some firms
Transaction Costs Analysis - Answers . Organizational structures are just means to perform the firm's
activities in the most efficient ways . The firm will expand as long as the cost of organizing an extra
transaction will be lower internally than when using the market . The original focus was on two
organizational structures - Hierarchy (FDI) - Market (independent exporter) . Understanding of
transaction costs is essential to make an informed decision . Opportunistic behavior of transaction
partners plays a key role in this model .
What is Global Marketing? - Answers The performance of business activities that direct the flow of a
company's goods and services to consumers or users in more than one nation for a profit
Why is Global Marketing Different? - Answers It generates new organizational challenges.
G-7 - Answers USA, Germany, UK, France, Japan, Canada, Italy
BRIC - Answers Brazil, Russia, India, China
N-11 - Answers Bangladesh Egypt Indonesia Iran Korea Mexico Nigeria Pakistan Philippines Turkey
Vietnam
What are emerging markets? - Answers Countries restructuring their economies along market- oriented
lines, offering opportunities in trade, technology, transfer & foreign direct investment.
Nokia in India - Answers Had 60%+ Market Share in India, Shifted R&D and manufacturing to India,
Product development and marketing 100% planned and executed by local teams (in weeks, not
months!) Employees empowered to criticized management decisions... and to contribute ideas to
improve performance
Decision to Go Global Affected by: - Answers Company Influences Industry Influences Market Influences
Proactive - Answers Profit and growth goals, Managerial urge, Technology competence/ unique
product/brand, Economies of scale/ Learning curve effects, Foreign market opportunities/market
information, Tax benefits, Proximity to international customers/psychological distance
Reactive - Answers Competitive pressures, Domestic market: small and saturated,
Overproduction/excess capacity, Unsolicited foreign orders, Extend sales of seasonal products
Economies of Scale - Answers a proportionate saving in costs gained by an increased level of
production."mergers may lead to economies of scale"
Learning Curve Effects - Answers In management, models of the learning curve effect and the closely
related experience curve effect express the relationship between equations for experience and
efficiency or between efficiency gains and investment in the effort.
Reactive Motives - Answers Competitive Pressures-anticipating future cost disadvantages because of
first mover advantages, small or saturated domestic markets; overproduction
Internal Triggers - Answers Perceptive Management/personal networks, Specific Internal Event,
Importing as inward internationalization
External Triggers - Answers Market Demand, Competing Firms, Network Partners, Outside experts,
Banks, Governments, Outside Experts, Chambers of Commerce
, Why are Triggers and Motives different? - Answers Motives should be viewed as certain attitudes
towards internationalization"-answers why the firm would like to go abroad, Triggers are change agents
that make firms go ahead, the same trigger might influence companies with different motives
Barriers to Global Expansion - Answers Insufficient finances, insufficient knowledge & finance. Lack of
foreign market connections, Lack of export commitment, Lack of capital to finance expansion into
foreign markets, Lack of productive capacity to dedicate to foreign markets, Lack of foreign channels of
distribution, Management emphasis on developing domestic markets, Cost escalation due to high export
manufacturing, distribution and financing expenditures
General market risks - Answers Competition from other firms ,Language and cultural differences
Commercial risks - Answers Exchange rate fluctuations, Failure of export customers to pay due to
contract disputes, bankruptcy, refusal to accept product or fraud
Political risk - Answers High foreign tariffs on imported products , Confusing foreign import regulations
and procedures, Civil strife, revolution and wars disrupting foreign markets
Hidden Costs of Internationalization - Answers Bias against foreign companies in advanced economies,
customers use global activity as a basis for inferences about quality and social responsibility
Uppsala model - Answers Saw internationalization process as gradual and involving progression along an
"establishment chain" of increasing commitment and also into psychically more distant markets
4 Stages of Uppsala - Answers 1. No regular exports-No active cultivation of foreign customers 2. Export
via independent representatives -Devoted exports 3. Establishment of a foreign sales subsidiary-‐
Interaction with foreign customers 4. Foreign production/manufacturing subsidiary- ‐Greater
involvement with foreign customers
Perspective of the Uppsala model - Answers • Market commitment consists of two factors - Amount of
resources commited - Specificity of resource commitment • Importance of knowledge - General market
knowledge - Market-‐specific knowledge • The greater the knowledge, the greater the commitment will
be • Key message of the Uppsala Model: Internationalization is a slow, time- ‐consuming and iterative
process
Benefits of the Uppsala model - Answers • Clarifies the level of investment commitment and risk
involved in different modes of operation • Shows the relationship between these different influences on
international investments • Describes the internationaliza;on process of some firms
Transaction Costs Analysis - Answers . Organizational structures are just means to perform the firm's
activities in the most efficient ways . The firm will expand as long as the cost of organizing an extra
transaction will be lower internally than when using the market . The original focus was on two
organizational structures - Hierarchy (FDI) - Market (independent exporter) . Understanding of
transaction costs is essential to make an informed decision . Opportunistic behavior of transaction
partners plays a key role in this model .
