Principles of Marketing, 19e (Kotler/Armstrong)
Chapter 19 The Global Marketplace
1) Which of the following does NOT characterize international trade in the past 30 years?
A) The number of multinational corporations has more than doubled.
B) Over 40 percent of the largest economies in the world are corporations.
C) Trade value of products and services grew even during the recession.
D) U.S. companies have long been successful at international marketing.
E) Home markets are just as rich in opportunity as foreign markets.
Answer: E
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
2) According to the text, what location does Coca-Cola consider a promising long-term growth
opportunity?
A) Russia
B) Brazil
C) China
D) Africa
E) India
Answer: D
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
3) Which of the following is most likely to be the consequence of increased growth of global
trade?
A) Home markets become richer in opportunities.
B) Foreign firms expand aggressively into new international markets.
C) Global competition is curbed.
D) Industries become safe from foreign competition.
E) Domestic companies increase their chances to dominate their home markets.
Answer: B
AACSB: Application of knowledge
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
1
,4) Firms that decide against international expansion to play it safe .
A) protect themselves from competition at home
B) gain a competitive edge against imports in their home markets
C) successfully shield themselves from foreign competition
D) risk losing their home markets
E) increase their chances of entering other markets
Answer: D
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
5) Companies risk losing their home markets .
A) by protecting themselves from competition at home
B) to other domestic competitors
C) as they may find foreign competitors in their own backyards
D) by focusing only on their home markets
E) in hopes of growing market share at home
Answer: C
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
6) Which of the following is a risk associated with international trade?
A) technological obsolescence
B) highly unstable governments
C) market monopolization
D) lack of trade barriers
E) currency stagnation
Answer: B
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
2
,7) Risks of global trade include all of the following EXCEPT .
A) high trade barriers
B) corruption
C) restrictive government policies
D) unstable currencies
E) increased opportunities for growth
Answer: E
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
8) A firm is one that, by operating in more than one country, gains marketing,
production, research and development, and financial advantages that are not available to purely
domestic competitors.
A) global
B) domestic
C) federally chartered
D) direct investment
E) free trade zone
Answer: A
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
9) Since the global company sees the world as one market, it raises capital, obtains components
and materials, and manufactures and markets its goods .
A) at home
B) in the lowest-cost country near where each product will be sold
C) in each country in which it does business
D) in the lowest-cost country on each continent
E) wherever it can do the best job
Answer: E
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
3
, 10) Which question should most likely be answered by all companies due to the rapid move
toward globalization?
A) How should we eliminate domestic competition?
B) Should we diversify in a new business area in the home country?
C) Who will our global competitors be, and what are their strategies and resources?
D) How should we fulfill our environmental obligations?
E) Which medium of advertising should we use in our home country?
Answer: C
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
11) Before a company decides to go global, it must evaluate all of the following environments
EXCEPT the environment.
A) cultural
B) natural
C) political-legal
D) global marketing
E) economic
Answer: B
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
12) Which of the following major decisions should a company make immediately after it
decides to operate internationally?
A) deciding which markets to enter
B) deciding how to enter the market
C) deciding on the global marketing organization
D) deciding on the global marketing program
E) deciding on the global communication program
Answer: A
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
4
Chapter 19 The Global Marketplace
1) Which of the following does NOT characterize international trade in the past 30 years?
A) The number of multinational corporations has more than doubled.
B) Over 40 percent of the largest economies in the world are corporations.
C) Trade value of products and services grew even during the recession.
D) U.S. companies have long been successful at international marketing.
E) Home markets are just as rich in opportunity as foreign markets.
Answer: E
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
2) According to the text, what location does Coca-Cola consider a promising long-term growth
opportunity?
A) Russia
B) Brazil
C) China
D) Africa
E) India
Answer: D
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
3) Which of the following is most likely to be the consequence of increased growth of global
trade?
A) Home markets become richer in opportunities.
B) Foreign firms expand aggressively into new international markets.
C) Global competition is curbed.
D) Industries become safe from foreign competition.
E) Domestic companies increase their chances to dominate their home markets.
Answer: B
AACSB: Application of knowledge
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
1
,4) Firms that decide against international expansion to play it safe .
A) protect themselves from competition at home
B) gain a competitive edge against imports in their home markets
C) successfully shield themselves from foreign competition
D) risk losing their home markets
E) increase their chances of entering other markets
Answer: D
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
5) Companies risk losing their home markets .
A) by protecting themselves from competition at home
B) to other domestic competitors
C) as they may find foreign competitors in their own backyards
D) by focusing only on their home markets
E) in hopes of growing market share at home
Answer: C
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
6) Which of the following is a risk associated with international trade?
A) technological obsolescence
B) highly unstable governments
C) market monopolization
D) lack of trade barriers
E) currency stagnation
Answer: B
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
2
,7) Risks of global trade include all of the following EXCEPT .
A) high trade barriers
B) corruption
C) restrictive government policies
D) unstable currencies
E) increased opportunities for growth
Answer: E
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
8) A firm is one that, by operating in more than one country, gains marketing,
production, research and development, and financial advantages that are not available to purely
domestic competitors.
A) global
B) domestic
C) federally chartered
D) direct investment
E) free trade zone
Answer: A
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
9) Since the global company sees the world as one market, it raises capital, obtains components
and materials, and manufactures and markets its goods .
A) at home
B) in the lowest-cost country near where each product will be sold
C) in each country in which it does business
D) in the lowest-cost country on each continent
E) wherever it can do the best job
Answer: E
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
3
, 10) Which question should most likely be answered by all companies due to the rapid move
toward globalization?
A) How should we eliminate domestic competition?
B) Should we diversify in a new business area in the home country?
C) Who will our global competitors be, and what are their strategies and resources?
D) How should we fulfill our environmental obligations?
E) Which medium of advertising should we use in our home country?
Answer: C
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Moderate
11) Before a company decides to go global, it must evaluate all of the following environments
EXCEPT the environment.
A) cultural
B) natural
C) political-legal
D) global marketing
E) economic
Answer: B
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
12) Which of the following major decisions should a company make immediately after it
decides to operate internationally?
A) deciding which markets to enter
B) deciding how to enter the market
C) deciding on the global marketing organization
D) deciding on the global marketing program
E) deciding on the global communication program
Answer: A
AACSB: Analytical thinking
Skill: Concept
Objective: LO 19.1: Discuss how the international trade system and the economic, political-
legal, and cultural environments affect a company's international marketing decisions.
Difficulty: Easy
4
