GEB 3373 International Business
Full Finals Exam Review (Qns & Ans)
2025
1. Multiple Choice
A multinational company (MNC) is entering a developing market
with high political instability. Which market entry strategy is most
suitable to minimize financial risk?
A. Direct investment
B. Joint venture
C. Exporting
D. Licensing
ANS: D. Licensing
©2025
, Rationale: Licensing allows the company to enter the market
with minimal investment while transferring the risk to a local
partner, making it suitable for politically unstable regions.
---
2. Fill-in-the-Blank
_ refers to the practice of setting up operations in a country to take
advantage of lower labor costs and reduced regulatory
requirements.
ANS: Offshoring
Rationale: Offshoring involves relocating business processes to
countries with lower operational costs to improve profitability.
---
3. True/False
Cultural differences have little impact on international business
negotiations.
ANS: False
©2025
, Rationale: Cultural differences significantly influence
negotiation styles, decision-making, and communication in
international business, requiring adaptability and understanding.
---
4. Multiple Response
Which factors are critical in determining the attractiveness of a
foreign market? (Select all that apply.)
A. Political stability
B. Economic growth rate
C. Language barriers
D. Regulatory environment
ANS: A, B, D
Rationale: Political stability, a robust economy, and a favorable
regulatory environment are key determinants, while language
barriers can be mitigated.
---
5. Multiple Choice
©2025
, What is the primary advantage of forming a strategic alliance in
international business?
A. Complete control over operations
B. Access to local market knowledge and resources
C. Reduced complexity in decision-making
D. Higher profit margins than other methods
ANS: B. Access to local market knowledge and resources
Rationale: Strategic alliances enable companies to leverage
local expertise and resources while sharing risks and rewards.
---
6. Fill-in-the-Blank
The _ theory in international trade suggests that countries should
specialize in producing goods where they have a relative
efficiency advantage.
ANS: Comparative advantage
Rationale: The theory of comparative advantage states that
countries benefit by focusing on goods where they have lower
opportunity costs relative to others.
©2025
Full Finals Exam Review (Qns & Ans)
2025
1. Multiple Choice
A multinational company (MNC) is entering a developing market
with high political instability. Which market entry strategy is most
suitable to minimize financial risk?
A. Direct investment
B. Joint venture
C. Exporting
D. Licensing
ANS: D. Licensing
©2025
, Rationale: Licensing allows the company to enter the market
with minimal investment while transferring the risk to a local
partner, making it suitable for politically unstable regions.
---
2. Fill-in-the-Blank
_ refers to the practice of setting up operations in a country to take
advantage of lower labor costs and reduced regulatory
requirements.
ANS: Offshoring
Rationale: Offshoring involves relocating business processes to
countries with lower operational costs to improve profitability.
---
3. True/False
Cultural differences have little impact on international business
negotiations.
ANS: False
©2025
, Rationale: Cultural differences significantly influence
negotiation styles, decision-making, and communication in
international business, requiring adaptability and understanding.
---
4. Multiple Response
Which factors are critical in determining the attractiveness of a
foreign market? (Select all that apply.)
A. Political stability
B. Economic growth rate
C. Language barriers
D. Regulatory environment
ANS: A, B, D
Rationale: Political stability, a robust economy, and a favorable
regulatory environment are key determinants, while language
barriers can be mitigated.
---
5. Multiple Choice
©2025
, What is the primary advantage of forming a strategic alliance in
international business?
A. Complete control over operations
B. Access to local market knowledge and resources
C. Reduced complexity in decision-making
D. Higher profit margins than other methods
ANS: B. Access to local market knowledge and resources
Rationale: Strategic alliances enable companies to leverage
local expertise and resources while sharing risks and rewards.
---
6. Fill-in-the-Blank
The _ theory in international trade suggests that countries should
specialize in producing goods where they have a relative
efficiency advantage.
ANS: Comparative advantage
Rationale: The theory of comparative advantage states that
countries benefit by focusing on goods where they have lower
opportunity costs relative to others.
©2025
