GMS 522 UPDATED CORE MAIN EXAMINATION
QUESTIONS AND ANSWERS SURE A+
✔✔The Mexican ambassador to Canada knew exactly why he was being asked to
attend a meeting in Ottawa. Mexican vegetable farmers were rumored to be subsidized
by their government. Canadian farmers in British Columbia and Ontario (two Canadian
provinces) had complained to the Canadian government calling for the imposition of
________________ on Mexican imports. The Mexican ambassador knew that if he was
not careful in discussions with trade officials in Ottawa the matter could soon be before
the World Trade Organization. - ✔✔Countervailing duties
✔✔Dreher (2006) measures globalization on three dimensions: economic, social and
political. The political dimension would capture: - ✔✔Diffusion of government policies
around the world
✔✔In Europe the European Commission examines transactions when any firm buys an
overseas company, engages in a joint venture with a foreign firm, or makes an
agreement with a competing firm in order to ensure that competition is not stifled. The
Commission is enforcing Europe's ________________ laws. - ✔✔Antitrust
✔✔Which is not a form of government export promotion? - ✔✔Establishing voluntary
export restrictions on local firms
, ✔✔Raymond and William had completed their foreign market entry analysis. They were
just about ready to make a recommendation to the Board on which country the
company should enter next. William recalled, however, that the last time they had
conducted such an analysis they did not factor in corruption levels. This omission
created serious problems for the company as the constant requests for bribes made day
to day operations in the country difficult. Below is a shortlist of countries Raymond and
William are considering entering with their TI corruption scores. Ignoring possible
methodological problems if perceived corruption level is the only deciding factor, which
country should be entered? Transparency International (TI) Corruption Perception Index
(2011) Denmark - 9.4 New Zealand - 9.5 Trinidad - 3.2 Iraq - 1.8 Somalia - 1.0 - ✔✔3)
New Zealand
✔✔LCD Inc., a privately owned Asian company, had developed a revolutionary
technology which significantly improved the screen resolution of the video iPod and
PDAs. The firm was interested in penetrating the North American market but did not
have the capital to set up manufacturing facilities to produce its own line of these hand
held devices. LCD knew that other firms were doing research in this area and may soon
have a competing technology. As a consultant to LCD you would recommend: - ✔✔2)
Licensing the technology to a manufacturer of hand held devices
✔✔The CEO of Ainsworth Inc. was committed to global expansion. Ainsworth was,
however, a new firm and had no track record operating outside of Canada. The CEO
was particularly concerned about political risk and the impact it could have on the firm's
expansion plans. Based only on the Profit Opportunity Recommendation (POR) scores
below which country should the CEO of Ainsworth avoid? POR Scores: Switzerland - 76
China - 58 Singapore - 72 India - 62 Russia - 43 - ✔✔Russia
✔✔Which (if any) is a potential effect of bribery and corruption? - ✔✔2) All of these
options
✔✔Henry was given responsibility for the implementation of a global marketing strategy
for Ambrosia Inc., a major food manufacturing firm. One of the biggest problems Henry
will face in implementing such a strategy is: - ✔✔Identifying homogenous consumer
segments in various countries
✔✔Jackie, the CEO of US Textiles Inc. knew she had to get her company's
manufacturing costs down if the company was to survive the current global recession.
As consumers cut back spending on clothing her company was being forced to compete
on price with manufacturers in China. The company's US-based plant was not
competitive based on relatively high labour costs. As a consultant to US Textiles you
would advise Jackie to: - ✔✔Relocate the company's manufacturing plant to a foreign
trade zone in Mexico
QUESTIONS AND ANSWERS SURE A+
✔✔The Mexican ambassador to Canada knew exactly why he was being asked to
attend a meeting in Ottawa. Mexican vegetable farmers were rumored to be subsidized
by their government. Canadian farmers in British Columbia and Ontario (two Canadian
provinces) had complained to the Canadian government calling for the imposition of
________________ on Mexican imports. The Mexican ambassador knew that if he was
not careful in discussions with trade officials in Ottawa the matter could soon be before
the World Trade Organization. - ✔✔Countervailing duties
✔✔Dreher (2006) measures globalization on three dimensions: economic, social and
political. The political dimension would capture: - ✔✔Diffusion of government policies
around the world
✔✔In Europe the European Commission examines transactions when any firm buys an
overseas company, engages in a joint venture with a foreign firm, or makes an
agreement with a competing firm in order to ensure that competition is not stifled. The
Commission is enforcing Europe's ________________ laws. - ✔✔Antitrust
✔✔Which is not a form of government export promotion? - ✔✔Establishing voluntary
export restrictions on local firms
, ✔✔Raymond and William had completed their foreign market entry analysis. They were
just about ready to make a recommendation to the Board on which country the
company should enter next. William recalled, however, that the last time they had
conducted such an analysis they did not factor in corruption levels. This omission
created serious problems for the company as the constant requests for bribes made day
to day operations in the country difficult. Below is a shortlist of countries Raymond and
William are considering entering with their TI corruption scores. Ignoring possible
methodological problems if perceived corruption level is the only deciding factor, which
country should be entered? Transparency International (TI) Corruption Perception Index
(2011) Denmark - 9.4 New Zealand - 9.5 Trinidad - 3.2 Iraq - 1.8 Somalia - 1.0 - ✔✔3)
New Zealand
✔✔LCD Inc., a privately owned Asian company, had developed a revolutionary
technology which significantly improved the screen resolution of the video iPod and
PDAs. The firm was interested in penetrating the North American market but did not
have the capital to set up manufacturing facilities to produce its own line of these hand
held devices. LCD knew that other firms were doing research in this area and may soon
have a competing technology. As a consultant to LCD you would recommend: - ✔✔2)
Licensing the technology to a manufacturer of hand held devices
✔✔The CEO of Ainsworth Inc. was committed to global expansion. Ainsworth was,
however, a new firm and had no track record operating outside of Canada. The CEO
was particularly concerned about political risk and the impact it could have on the firm's
expansion plans. Based only on the Profit Opportunity Recommendation (POR) scores
below which country should the CEO of Ainsworth avoid? POR Scores: Switzerland - 76
China - 58 Singapore - 72 India - 62 Russia - 43 - ✔✔Russia
✔✔Which (if any) is a potential effect of bribery and corruption? - ✔✔2) All of these
options
✔✔Henry was given responsibility for the implementation of a global marketing strategy
for Ambrosia Inc., a major food manufacturing firm. One of the biggest problems Henry
will face in implementing such a strategy is: - ✔✔Identifying homogenous consumer
segments in various countries
✔✔Jackie, the CEO of US Textiles Inc. knew she had to get her company's
manufacturing costs down if the company was to survive the current global recession.
As consumers cut back spending on clothing her company was being forced to compete
on price with manufacturers in China. The company's US-based plant was not
competitive based on relatively high labour costs. As a consultant to US Textiles you
would advise Jackie to: - ✔✔Relocate the company's manufacturing plant to a foreign
trade zone in Mexico
