International Management: Culture, Strategy, and Behavior, 10th Edition Test Bank

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Chapter 01-Globalization and International Linkages1-1Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Chapter 01Globalization and International LinkagesTrue/False Questions1. Internationalization is the vision of creating one world unit, a single market entity.Answer: FalseFeedback: Internationalization is the process of a businesscrossing national and culturalborders, while globalization is the vision of creating one world unit, a single market entity.AACSB: AnalyticBloom's: RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization2. In the context of the changing global demographics, elderly populations spend money onhousing and other capitally financed purchases.Answer: FalseFeedback:Whileelderly populations spend money on health care services, youngerpopulations spend income on housing and other capitally financed purchases.AACSB: AnalyticBloom's:RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty:1 EasyTopic: Globalization and Internationalization3.North American Free Trade Agreement (NAFTA)members arebetter integrated as asingle market than theEuropean Union(EU) or the allied Asian countries.Answer: FalseFeedback: Even though long-standing cultural differences remain, and theEuropean Unionhas recently experienced some substantial challenges, theEuropean Unionis more integratedas a single market thanNAFTA, CAFTA, or the allied Asian countries.AACSB: AnalyticBloom's: RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization4. General Electric (GE)has strategically leveraged social media to improve its long-termbrand image.Answer: TrueFeedback: General Electric (GE)has strategically leveraged social media to improve its long-term brand image. By interacting daily with customers across a variety of social networks, the

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Chapter 01-Globalization and International Linkages1-2Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.100-year-old company aims to transform the way that its brand is perceived whilesimultaneously building a new generation of consumers.AACSB: AnalyticBloom's: RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: An Interconnected World5. An increase in the ease of travel between countries is an important development that hasoccurred because of the North American Free Trade Agreement (NAFTA).Answer: TrueFeedback: An increase in the ease of travel between countries is an important developmentthat has occurred because of the North American Free Trade Agreement (NAFTA). Otherimportant developments include the elimination of tariffs as well as import and export quotas,the opening of government procurement markets to companies inCanada and Mexico, anincrease in the opportunity to make investments in each other’s country, and the removal ofrestrictions on agricultural products, auto parts, and energy goods.AACSB: AnalyticBloom's:RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization6. According toaGoldman Sachs global economics team report, it is estimated that theeconomies of Brazil, Russia, India, and China, which it collectively coined as the "BRIC"nations,will surpass the collective economies of the G7 nations by 2032.Answer: TrueFeedback: According toaGoldman Sachs global economics team report, it is estimated thatthe economies of Brazil, Russia, India, and China, which it collectively coined as the "BRIC"nations, will surpass the collective economies of the G7 nations by 2032.AACSB: AnalyticBloom's: RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization7. Foreign direct investment has been falling alarmingly since the global recession of 2009 inmost regions of the world.Answer: FalseFeedback: Foreign direct investment (FDI)—the term used to indicate the amount invested inproperty, plant, and equipment in another country—has been growing at a slow but steadyrate in the years since the global recession of 2009.AACSB: AnalyticBloom's: RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.

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Chapter 01-Globalization and International Linkages1-3Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization8.In a command economy, a general balance between supply and demand sustains prices,while an imbalance creates a price fluctuation.Answer: FalseFeedback:In a command economy, the government has explicit controlover the price andsupply of a good or service. The particular goods and services offered are not necessarily inresponse to consumers'stated needs but are determined by the theoretical advancement ofsociety.AACSB: AnalyticBloom's:RememberLearning Objective:01-02 REVIEW the major trends in global and regional integration.Level of Difficulty: 1 EasyTopic:Global Economic Systems9.Monopolies are a danger to the market economy system because they tend to stifleeconomic growth.Answer: TrueFeedback:Monopolies are a danger to the market economy system because they tend to stifleeconomic growth and consumer choice with their power to determine supply. Factors such asefficiency of production and quality and pricing of goods can be chosen arbitrarily bymonopolies, leaving consumers without a choice and at the mercy of big businesses.AACSB: AnalyticBloom's:RememberLearning Objective:01-02 REVIEW the major trends in global and regional integration.Level of Difficulty:1 EasyTopic:Global Economic Systems10.In the context of the emerging markets of Asia, India is attractive to multinationals,especially U.S. and British firms.Answer: TrueFeedback:India is attractive to multinationals, especially U.S. and British firms. Many Indianpeople speak English, are very well educated, and are known for advanced informationtechnology expertise.AACSB: AnalyticBloom's:RememberLearning Objective:01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic:Economic Performance and Issues of Major Regions11.TheUnited Stateshasconsiderableforeign direct investment in Germany, morethaninany other country.Answer: FalseFeedback:The United States has considerable foreign direct investment in Canada, more thanin any other country. Canada is the UnitedStates'largest trading partner, a position it hasheld for many years.AACSB: Analytic

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Chapter 01-Globalization and International Linkages1-4Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Bloom's: RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major Regions12.Despite being unable to take full advantage of globalization, there is still hope in thefuture for Africa because the potential of African countries remains virtually untapped.Answer: TrueFeedback:Despite being unable to take full advantage of globalization, there is still hope inthe future for Africa because the potential of African countries remains virtually untapped.Not only are there considerable natural resources, but the diversity itself also can be used toadvantage.AACSB: AnalyticBloom's:RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major Regions13.One of the factors that contributed to the early success of the Japanese economyisthepresence ofchaebols.Answer: FalseFeedback:One of the factors that contributed to the early success of the Japanese economy istheMinistry of International Trade and Industry (MITI). This is a governmental agency thatidentifies and ranks national commercial pursuits and guides the distribution of nationalresources to meet these goals.AACSB: AnalyticBloom's:RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: EconomicPerformance and Issues of Major Regions14.About 46 percent of employees in both the United States and Russia would prefer a workschedule that fluctuates between work and leisure, mirroring a pattern of recurringsabbaticals.Answer:TrueFeedback:About 46 percent of employees in boththe United States and Russia would prefera work schedule that fluctuates between work and leisure, mirroring a pattern of recurringsabbaticals.This similarity can be taken into account by a U.S. firm when consideringopening a business in Russia.AACSB: AnalyticBloom's: RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major Regions

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Chapter 01-Globalization and International Linkages1-5Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.15.The ultimate objective of theEuropean Union(EU)is to eliminate all trade barriersamong member countries.Answer: TrueFeedback:The ultimate objective of theEuropean Unionis to eliminate all tradebarriersamong member countries (like between the states in the United States).AACSB: AnalyticBloom's: RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major Regions16.The economy of Argentina outweighs that of any other South American country with aneconomic output comparable to that of Franceand has become a worldwidepresence.Answer:FalseFeedback:The Brazilian economy outweighs that of any other South American country withan economic output comparable to that of Franceand has become a worldwide presence.Given Brazil's large and relatively well-educated population, ample natural resources,existing industrial base, and strategic geographic position, longer-term prospects are stillpotentially positive.AACSB: AnalyticBloom's: RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major Regions17. The Brazilian economy outweighs that of any other South American country with aneconomic output comparable tothat of France.Answer: TrueFeedback: The Brazilian economy outweighs that of any other South American country withan economic output comparable to that of France. Longer-term prospects are still potentiallypositive because of its large and relatively well-educated population, ample natural resources,existing industrial base, and strategic geographic position.AACSB: AnalyticBloom's:RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty: 1 EasyTopic: Economic Performance and Issues of Major Regions18. China remains a major risk for investors because they are required to maintain a delicatebalance between the country's communist and capitalist systems.Answer: TrueFeedback: China remains a major risk for investors. The one country, two systems(communism and capitalism) balance is a delicate one to maintain, and foreign businesses areoften caught in the middle.AACSB: AnalyticBloom's:Remember

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Chapter 01-Globalization and International Linkages1-6Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Learning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty: 1 EasyTopic: Economic Performance and Issues of Major Regions19.Hungary'seconomy was the onlyeconomy in the EU to continue to grow during theglobal recession of 2008–2009.Answer: FalseFeedback:Poland's economy was the only economy in theEuropean Unionto continue togrow during the global recession of 2008–2009. In 2015, Poland's GDP grewby around 4percent. Although the relatively swift transition to a market economy has been very difficultfor the Polish people, with very high inflation initially, continuing unemployment, and thedecline of public services, Poland's economy has done relatively well.AACSB: AnalyticBloom's: RememberLearning Objective: 01-03 EXAMINE the changing balance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major Regions20.Singapore has emerged as an urban planner's ideal model and the leader and financialcenter of Southeast Asia.Answer: TrueFeedback:Singapore has emerged as an urban planner's ideal model and the leader andfinancial center of SoutheastAsia.It is a major success story,and its solid foundation leavesonly the question of how to continue expanding in the face of increasing internationalcompetition.AACSB: AnalyticBloom's: RememberLearning Objective: 01-03 EXAMINE the changingbalance of global economic power andtrade and investment flows among countries.Level of Difficulty:1 EasyTopic: Economic Performance and Issues of Major RegionsMultiple Choice Questions21._____ isthe process of applying managementconcepts and techniques in a multinationalenvironment and adapting management practices to different economic, political, and culturalenvironments.A.Strategic managementB.InternationalizationC.GlobalizationD.International managementAnswer: DFeedback:International management is the process of applying management concepts andtechniques in a multinational environment and adapting management practices to differenteconomic, political, and cultural contexts.AACSB: Analytic

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Chapter 01-Globalization and International Linkages1-7Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Bloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Introduction22.To qualify as a multinational corporation(MNC), a firm must meet all ofthe followingcriteria except:A.operationsin more than one country.B.internationalsales.C.amix of nationalities among managers and owners.D.salesof at least one million dollars per year.Answer: DFeedback:An MNC is a firm that hasoperations in more than one country, internationalsales, and a mix of nationalities among managers and owners.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Introduction23.Critics of globalizationbelieve that:A.the offshoring of business services jobs to lower-wage countries inherently creates greateropportunities at home.B.growing trade deficits andslow wage growth are damaging economies.C.when production moves to countries to take advantage of less-regulated environments, anupward pressure is created on wages and working conditions.D.the main winners of globalization are the low-wage workers.Answer: BFeedback:In the context of globalization, critics believe that growing trade deficits and slowwage growth are damaging economies.Theyalsobelieve that globalization may be movingtoo fast for some emerging markets, which could result ineconomic collapse.AACSB: AnalyticBloom's: UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Globalization andInternationalization24.The subcontracting or contracting out of activities to external organizations that hadpreviously been performed byafirm is called_____.A.homesourcingB.insourcingC.offshoringD.outsourcingAnswer: DFeedback:Outsourcing is the subcontracting or contracting out of activities to externalorganizations that had previously been performed byafirm.

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Chapter 01-Globalization and International Linkages1-8Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Globalization and Internationalization25._____ is the process by which companies undertake some activities at offshore locationsinstead of in their countries of origin.A.HomesourcingB.InsourcingC.OffshoringD.GlobalizationAnswer: CFeedback:Offshoring is the process by which companies undertake some activities atoffshore locations instead of in their countries of origin.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty:1 EasyTopic: Globalization and Internationalization26.The_____ is the global organization of countries thatoversees rules and regulations forinternational trade and investment, including agriculture, intellectual property, services,competition,and subsidies.A.WTOB.NAFTAC.WIPOD.ITOAnswer: AFeedback:The WTO is the global organization of countries that oversees rules andregulations for international trade and investment, including agriculture, intellectual property,services, competition, and subsidies.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization27.The _____ is afree-trade agreement among the United States, Canada, and Mexico thathas removed most barriers to trade and investment.A.AFTAB.EFTAC.CAFTAD.NAFTAAnswer: D

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Chapter 01-Globalization and International Linkages1-9Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Feedback:The United States, Canada, and Mexico make up the North American Free TradeAgreement (NAFTA), which in essence has removed all barriers to trade among thesecountries and created a huge North American market.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization28.Identify atruestatementabout theDevelopment Roundin which the members of theWorld Trade Organization (WTO) metand launched a round of negotiations at Doha, Qatarin November 2011.A.TheWTO members agreed upon the opening of government procurement markets tocompanies in thedevelopednations.B.There was a lack of consensus among WTO members regarding agricultural subsidies.C.There was a lack of consensus among WTO members regardingunbalanced populationpyramids.D.TheWTO members agreedupon the issues of competition.Answer:BFeedback:During the Development Round in which the members of the World TradeOrganization (WTO) met, in November 2011, and successfully launched a new round ofnegotiations at Doha, Qatar, there was a lack of consensus among WTO members regardingagricultural subsidiesand the issues of competition and government procurement.AACSB: AnalyticBloom's:RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization29.The United States, Canada,and Mexico make up the _____, which in essence hasremoved all barriers to tradeamongthese countries and created a huge North Americanmarket.A.General Agreement on Tariffs and TradeB.North American Common MarketC.North American Free Trade AgreementD.North American Trade UnionAnswer: CFeedback:The United States, Canada, and Mexico make up the North American Free TradeAgreement (NAFTA), which in essence has removed all barriers to trade among thesecountries and created a huge North American market.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization

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Chapter 01-Globalization and International Linkages1-10Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.30.Agreements like NAFTA and CAFTA:A.notonly reduce barriers to trade but also require additional domestic legal and businessreforms in developing nations to protect property rights.B.donot include supplemental commitmentslike the FTAAdoesonlaborand theenvironment to encourage countries to upgrade their working conditions and environmentalprotections.C.relyexclusively on MNCs exporting or setting up operations locally rather than buying outa domestic firm.D.providefirms with enough security so they cannot go out of business, which simplyencourages a lack of efficiency or incentive to monitor costs.Answer: AFeedback:Agreements like NAFTA and CAFTA not only reducebarriers to trade but alsorequire additional domestic legal and business reforms in developing nations to protectproperty rights.AACSB: AnalyticBloom's: UnderstandLearning Objective:01-01 ASSESS the implications of globalization forcountries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Globalization and Internationalization31.In the context of thechanging global demographics, identifya changethatwill be seenindeveloped nations.A.Developed Asian nations will be able toeasilyreplace the retiring, aging population.B.In Japan, the number of nonworkers will be nearly equal to that of workers by 2050.C.In South Korea, the immigration policy will ease by 2050.D.InGermany, there will be aremoval of restrictions on agricultural products, auto parts,and energy goods.Answer: BFeedback:Demographic changes are projected to occur globally, and the most dramaticimpact will be seen in the developed nations. In Japan, the number of nonworkers will benearly equal to that of workers by 2050. Both Japan and South Korea will face a loss of over25 percent of their working-class population.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS theimplications of globalization for countries, industries,firms, and communities.Level of Difficulty:2 MediumTopic: Globalization and Internationalization32.According to some critics, agreements likeNorth American Free Trade Agreement(NAFTA) andCentral American Free Trade Agreement (CAFTA):A.have been successful in ensuring environmental standards.B.have been successful inpreventingthe decline of theglobal working-age population.C.do not go far enough in ensuring worker rights.D.do not go far enough inprotectingproperty rights.Answer: CFeedback:According to some critics, agreements likeNorth American Free Trade Agreement(NAFTA) and Central American Free Trade Agreement (CAFTA)do not go far enough in

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Chapter 01-Globalization and International Linkages1-11Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.ensuring worker rights.They alsobelieve that the agreements do not go far enough inensuring environmental standards.AACSB:AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Globalization and Internationalization33.The Asian economicblock, made up of Indonesia, Malaysia, the Philippines, Singapore,Brunei, Thailand, Cambodia, Myanmar, and Vietnam,is referred to asthe:A.Association of Southeast Asian Nations (ASEAN).B.Southeast Asia Free Trade Agreement (SWAFTA).C.Southeast Asia Common Market.D.Asian Economic Union.Answer: AFeedback:The Association of Southeast Asian Nations (ASEAN) is made up of Indonesia,Malaysia, the Philippines, Singapore, Brunei, Thailand, and,in recent years,Cambodia,Myanmar, and Vietnam.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty:1 EasyTopic:Globalization and Internationalization34.A methodthatadjusts GDP to account for different prices in countries is called:A.cumulativedistribution function.B.nominalGDP.C.currentcurrency exchange rate.D.purchasingpower parity.Answer: DFeedback:Purchasing power parity (PPP) is a method that adjusts GDP to account fordifferent prices in countries.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, andcommunities.Level of Difficulty:1 EasyTopic: Globalization and Internationalization35.Unlike theGroup of Seven (G7)economies, theEmerging Seven (E7)economies are:A.primarily located in North America and Europe.B.located throughout LatinAmerica and Asia.C.mature economies in which economic growth is slow.D.incentivizing citizens to have more children.Answer: BFeedback:Unlike theGroup of Seven (G7) economies, the Emerging Seven (E7)economiesare located throughout Latin America and Asia. In March 2006, the term E7 was coined by

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Chapter 01-Globalization and International Linkages1-12Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.PricewaterhouseCoopers (PwC) to describe seven major emerging economies of Brazil,China, India, Indonesia, Mexico, Russia, and Turkey that are expected to expand significantlyin the coming decades.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic:Globalization and Internationalization36.Which of the followingstatements is trueaccording to the reports that were released in2004 and 2011 by the Goldman Sachs global economics team?A.The economies of Russia and Brazil would remainunaffected by the low prices for oil andother commodities in the years 2015 and 2016.B.The BRIC (Brazil, Russia, India, and China)economies'share of world growth could risesignificantlyfrom 2003 to 2025.C.Theeconomies ofIndonesia, Mexico, andTurkeycouldexpand significantly in thecoming decades.D.The E7 (Brazil, China, India, Indonesia, Mexico, Russia, and Turkey) economies wouldmature and slowdown in terms of market exchange rates.Answer: BFeedback:According to the reports that were released in 2004 and 2011 by the GoldmanSachs global economics team, the BRIC (Brazil, Russia, India, and China) economies'shareof world growth could rise significantly from 2003 to 2025. It could rise from 20 percent in2003 to more than 40 percent in 2025.The reports also predicted thatthe BRIC's total weightin the world economy would rise from approximately 10 percent in 2004 to more than 20percent in 2025.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty:2 MediumTopic: Globalization and Internationalization37._____ is the term used to indicate the amount invested in property, plant, and equipmentin another country.A.ExportingB.Foreign direct investmentC.ImportingD.Trade imperfectionAnswer: BFeedback:Foreign directinvestment (FDI) is the term used to indicate the amount invested inproperty, plant, and equipment in another country.AACSB: AnalyticBloom's: RememberLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty:1 EasyTopic: Globalization and Internationalization

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Chapter 01-Globalization and International Linkages1-13Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.38.According to the World Trade Organization, in 2014merchandise exports:A.reached a record high.B.declined for the first time since 1983.C.remainedfairly consistent.D.decreasedby almost 50 percent.Answer: AFeedback:According to the World Trade Organization, in2014merchandise exports reacheda record high $18.2 trillion, and commercial services exports have rebounded to $4.2 trillion.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Globalization and Internationalization39.In 2009,globalFDI_____.A.nearly doubledB.nearlytripledC.droppedsubstantiallyD.remainedfairly constantAnswer:CFeedback:In 2009, global FDIdropped significantly byalmost 50 percent to $896 billion. Itrebounded to $1.5 trillion by 2013.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 2 MediumTopic: Globalization and Internationalization40.By 2017,foreign direct investment (FDI)is estimated to:A.surpass the all-time high set a decade earlier in 2007.B.reach an all-timelow due to political instability and uncertain markets.C.experience a significantdropsimilar tothe global recession of 2009.D.experience an insignificant rise due to a slow rate of increase of merchandise exports.Answer: AFeedback:By 2017, foreign direct investment (FDI) is estimated to surpass the all-time highset a decade earlier in 2007. Despite dropping almost 50percent in 2009 to $896 billion,global FDI rebounded to $1.5 trillion by 2013.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level ofDifficulty: 2 MediumTopic: Globalization and Internationalization

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Chapter 01-Globalization and International Linkages1-14Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.41.In the context of theshifting balance ofeconomicpower in theglobaleconomy, which ofthe followingfactorshas helped boost incomes and wealth in the African continentbetween2000 and 2015?A.A one-child policyB.An increase in the price of agricultural productsC.An increase in the size of the elderly populationD.An easy immigration process for workersAnswer:BFeedback:In the context ofthe shiftingbalance of economic power in the global economy, anincrease in the price of agricultural products has helped boost incomes and wealth in theAfrican continentbetween 2000 and 2015.Also, increases in the price of commodities, suchas oil,gas, and mineral and mining products have helped boost incomes and wealth in thecontinent.AACSB: AnalyticBloom's:UnderstandLearning Objective:01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level ofDifficulty: 2 MediumTopic: Globalization and Internationalization42. The Trans-Pacific Partnership (TPP) is a trade agreement among 12 Pacific Rimcountries, including:A. Peru, the United States, and Vietnam.B. Great Britain, New Zealand, and China.C. India, Canada, and Australia.D. Singapore, Russia, and Chile.Answer: AFeedback: The Trans-Pacific Partnership (TPP) is a trade agreement among 12 Pacific Rimcountries, includingAustralia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, NewZealand, Peru, Singapore, the United States, and Vietnam.AACSB: AnalyticBloom's: RememberLearning Objective: 01-01 ASSESS the implications of globalization for countries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization43. Which of the following economies is projected to becomethe largest by 2050 usingmarket exchange rates?A. ChinaB. IndiaC. AustraliaD. BrazilAnswer: AFeedback: The economy of China is projected to becomethe largest by 2050 using marketexchange rates. China would surge past the United States and Japan as the largest worldeconomic power by 2050.AACSB: AnalyticBloom's: Remember

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International Management: Culture, Strategy, and Behavior, 10th Edition Test Bank - Page 16 preview image

Chapter 01-Globalization and International Linkages1-15Copyright ©2018McGraw-Hill Education. All rights reserved. No reproduction or distribution without theprior written consent of McGraw-Hill Education.Learning Objective: 01-01 ASSESS the implications of globalization forcountries, industries,firms, and communities.Level of Difficulty: 1 EasyTopic: Globalization and Internationalization44.A _____ is comparable to a monopoly in the sense thatanorganization, in this case thegovernment, has explicit control over the price and supply of a good or service.A.commandeconomyB.marketeconomyC.mixedeconomyD.socialisteconomyAnswer: AFeedback:A command economy is comparable to a monopoly in the sense thatanorganization, in this case the government, has explicit control over the price and supply of agood or service.AACSB: AnalyticBloom's:RememberLearning Objective: 01-02 REVIEW themajor trends in global and regional integration.Level of Difficulty:1 EasyTopic: Global Economic Systems45.Identify a characteristic of a market economy.A.The state reserves the right to monitor the production and distribution of goods andservices.B.Private enterprisesreserve the right to own property.C.Monopolies boost economic growth.D.Competition is discouraged because it hinders penetration into niche markets.Answer:BFeedback:A market economy exists when private enterprise reserves the right to ownproperty and monitor the production and distribution of goods and services while the statesimply supports competition and efficient practices.Management is particularly effectivehere since private ownership provides local evaluation and understanding, opposed to anationally standardized archetype.AACSB: AnalyticBloom's: UnderstandLearning Objective: 01-02 REVIEW the major trends in global and regional integration.Level ofDifficulty: 2 MediumTopic: Global Economic Systems46.Unlike a market economy, a command economyis characterized by:A.private ownershipof businesses.B.an appropriate response to consumers'stated needsand desires.C.insufficient security provided by government subsidies.D.an ignorance of demographic information by management.Answer: DFeedback:Unlike a market economy, a command economy is characterized by an ignoranceof demographic information by management. In a market economy, individuals within thecommunity disclose wants, needs, and desires to which businesses may appropriatelyrespond.

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