Question-1
Which of the following terms refers to the basic means by which a company competes?
A. Mission
B. Procedure
C. Strategy
D. Process
Question-2
The primary motive in the contract manufacturing strategy is:
A. utilizing inexpensive overseas labor.
B. obtaining rights to patented technology.
C. sharing managerial expertise.
D. sharing financial resources.
Question-3
Which of the following statements is true of the strategic formulation process?
A. The global strategic formulation process is completely independent of the process followed in domestic companies.
B. The strategic formulation process is part of the strategic management process in which most firms engage, either formally or informally.
C. Strategic formulation consists of four defined stages that occur in a consecutive order.
D. Most firms operate on planning cycles of one or two years with periodic strategy reviews.
Question-4
Which of the following charts the direction of the company and provides a basis for strategic decision making?
A. Environmental assessment
B. Corporate structure
C. Organizational mission
D. SWOT analysis
Question-5
Restrictive trade barriers most likely influence the globalization of businesses by encouraging firms to:
A. develop joint ventures with local firms.
B. import supplies from foreign vendors.
C. expand the exportation of raw materials.
D. switch from exporting to overseas manufacturing.
Question-6
Dell is an American corporation that deals with computer technology. With its worldwide sourcing and fully merged production and marketing system, Dell is considered to be a:
A. greenfield investment.
B. turnkey operation.
C. shell corporation.
D. globally integrated company.
Question-7
Jamie decides to plan his strategies for starting an electric equipment manufacturing company. His main aim is to ensure that it runs efficiently. He decides to do this in two phases: the planning phase and the implementation phase. Which of the following processes is Jamie employing?
A. Retrenchment
B. Organizational restructuring
C. Strategic management
D. Globalization
Question-8
Which of the following is the most likely result of regulations and restrictions enforced by a firm's home government that prove to be expensive for the firm's operations?
A. The firm searches for less restrictive operating environments overseas
B. The firm responds to customers' demands more promptly
C. The firm becomes entangled in lengthy litigation
D. The firm expands its domestic operations
Question-9
Futura-Core Technologies, an electronics manufacturing firm, has advantages in financial capability and sustainability, but a disadvantage in speed of innovation. It is also at a disadvantage relative to Core-Dynamix Technologies, another electronics manufacturing firm, in important factors such as manufacturing capability and adaptability to market conditions. Which of the following terms best describes Futura-Core's abilities in comparison to Core-Dynamix?
A. Comparative advantage
B. Collective bargaining
C. Competitive advantage
D. Absolute advantage
Question-10
Due to the high demand for its handmade soaps in Canada, Fragrance Exotica, an Indian Soap manufacturer, has decided to open a new manufacturing unit in Canada, thereby expanding overseas. In this scenario, which of the following reasons prompted Fragrance Exotica to set up a manufacturing unit overseas?
A. Trade barriers
B. Manufacturer demands
C. Customer demands
D. Tax incentives
Question-11
Which of the following entry strategies is most likely to serve as a short-term strategy and to provide limited income?
A. Joint venture
B. Management contract
C. Offshoring
D. Fully owned subsidiary
Question-12
Which of the following would most likely be categorized as a global financial objective of an international firm?
A. Foreign-exchange management
B. Long-term profit growth
C. Quality and cost control
D. Company market share
Question-13
Which of the following strategies would a non-European company most likely use if it wanted to gain quick entry inside the European community?
A. International joint venture
B. Greenfield investment
C. Turnkey operation
D. Offshoring
Question-14
Which of the following is the most common reactive reason for a firm to extend its operations overseas?
A. Tax incentives
B. Economies of scale
C. Globalization of competitors
D. Resource access and cost savings
Question-15
At which three levels should firms ideally perform global environmental analysis?
A. Product, domestic market, and consumer
B. Multinational, regional, and local
C. Operational, tactical, and top management
D. Innovation, production, and local distribution
Question-16
Which of the following is the proactive reason that prompts firms to expand overseas?
A. Avoiding restrictive trade barriers
B. Solving logistics-related problems
C. Responding to foreign competition
D. Seeking economies of scale
Question-17
The first broad scan of all potential world markets should result in the firm being able to:
A. identify the strengths and weaknesses of its competitors.
B. eliminate markets with unreasonable entry conditions.
C. determine the best sources for raw materials.
D. eliminate countries with high cultural risk.
Question-18
Which of the following is a national risk with regard to strategic entry scanning?
A. Energy availability and prices
B. Regional instability
C. Legal protection
D. Political turmoil
Question-19
Which of the following is true with regard to direct coordinating mechanisms?
A. Expatriates from "headquarters" do not exert control over the foreign affiliate through the expectations of the national and corporate culture of the parent company.
B. Even in situations where parent control is considered less important, delegating the control to the local level is ritually avoided.
C. Direct coordinating mechanisms that provide the basis for the overall guidance and management of foreign operations include the design of appropriate organizational structures and the use of effective staffing practices.
D. Direct coordinating mechanisms do not include staffing practices.
Question-20
According to David Lei, the single greatest impediment managers face when seeking to learn or renew sources of competitive advantage is that:
A. good venture partners are hard to find.
B. technologies change very rapidly.
C. partners can become competitors.
D. governments can be fickle.
Question-21
Which of the following indicates a need for change in organizational design?
A. Low turnover
B. A decrease in overseas customer complaints
C. Seamless innovation
D. New management with different goals and strategies
Question-22
Which of the following is true about the matrix structure of organizational design?
A. The matrix structure is developed to combine geographic support for both global integration and local responsiveness.
B. Regional managers are solely responsible for the operations and performance of the countries within a given region.
C. In the matrix structure, communication problems, confusion, and conflict are minimal.
D. Overlapping responsibilities are absent in a matrix structure.
Question-23
Organizing for global product standardization requires __________, an especially difficult task for multiproduct companies.
A. multibranding
B. vertical organizational mobility
C. seamless product development
D. centralized global product responsibility
Question-24
Which of the following primarily determines the extent of control exercised over an IJV by its parent company?
A. Staffing choices for top IJV positions
B. Policies of the smaller firm
C. Cultural background
D. IJV industry
Question-25
Nimbus Inc. is a hybrid organization. The organizational structure of the company has been developed to combine geographic support for both global integration and local responsiveness. Nimbus is not a hierarchical organization and uses cross-functional teams to quickly adapt to the dynamic business environment.
If the above information is
true, which of the following can be fittingly inferred?
A. Nimbus has only a few SBUs.
B. Nimbus has a matrix structure.
C. Nimbus is a born global.
D. Nimbus does not favor standardization of its products.
Question-26
Which of the following is true with regard to the global geographic structure?
A. With the geographic structure, the focus is on importing.
B. Marketing-oriented companies are most likely to opt for this structure.
C. The geographic structure is not an adequate structure for consolidating regional expertise.
D. In a geographic structure, problems of coordination across different regions are virtually nonexistent.
Question-27
NextLinx Corporation provides a wide range of strategic implementation services for small- and medium-sized organizations. It allows all trading partners to collaborate in a single online location, using the same information and processes. Therefore, NextLinx is an example of a(n):
A. e-commerce enabler.
B. knowledge management firm.
C. IJV controller.
D. outsourcing company.
Question-28
Trout Corp., Kirgo Ltd., and Sturgeon Inc., three of the leading construction companies in the U.S., have decided to join hands and create a new cement manufacturing company. According to their agreement, Trout Corp. will have 50 percent equity, Kirgo Ltd. will have 20 percent equity, and Sturgeon Inc. will have 30 percent equity. In this given scenario, Sturgeon Inc. is referred to as a(n):
A. minority JV partner.
B. majority JV partner.
C. sole proprietor.
D. franchisor.
Question-29
In their rush to get on the globalization bandwagon, too many firms have:
A. opted for niche marketing.
B. sacrificed the ability to respond to local market structures and consumer preferences.
C. overly focused on local markets at the cost of losing out on market share abroad.
D. wrongly overestimated the importance of mass customization for the global market.
Question-30
In order to minimize potential problems in alliances, companies should most likely choose partners with:
A. competitively sensitive technology.
B. complementary products and skills.
C. significant control of the target market.
D. superior bargaining power in the same industry.
Question-31
International joint ventures are less likely to break up when:
A. issues are settled before the merger.
B. new policies are created after the merger.
C. one partner has all the decision-making autonomy and the other has none.
D. each firm explicitly states its actions and requirements after the merger.
Question-32
Overlooking cultural differences in cross-border alliances can create a negative impact when target country:
A. has similar views on organizational formality.
B. and host country equally participate in decision making.
C. is technologically superior to the host country.
D. has conflicting practices and systems.
Question-33
Managers choose the manufacturing location for each product based on where the best combination of cost, quality, and technology can be attained in order to achieve:
A. customer loyalty.
B. integration.
C. segregation.
D. rationalization.
Question-34
Papillion Inc. is a small American high-technology firm that has been successfully competing in the international business arena from its inception two years ago. Instead of internationalizing slowly, Papillion embarked upon an ambitious plan to leverage niche market opportunities worldwide—right from the beginning. Papillion Inc. exemplifies the __________ phenomenon.
A. born-global
B. subordinateship
C. outsourcing
D. insourcing
Question-35
According to the __________ model, as the company becomes larger, more complex, and more sophisticated in its approach to world markets, it may evolve into a transnational corporation.
A. four stages of contribution
B. crowdsourcing
C. matrix
D. evolutionary stages
Question-36
All of the following are cooperative aspects of strategic alliances EXCEPT:
A. creating economies of scale in tangible assets.
B. forming upstream–downstream divisions of labor.
C. limiting investment risks through shared resources.
D. learning new intangible skills from alliance partners.
Question-37
In spite of the potential problems with local partners, many firms rush the process of partner selection because they:
A. want to reduce the amount spent on establishing subsidiaries abroad
B. want to take advantage of the local partner's technological innovations.
C. mostly aim at increasing the number of equity shares within a short period of time.
D. are anxious to get into an attractive market.
Question-38
The initial challenge in implementing strategies in emerging markets is likely to be how to:
A. compete with other emerging markets.
B. allocate responsibilities between the partners.
C. set up new policies and regulations.
D. navigate poor infrastructures.
Question-39
Offshoring provides the company with access to foreign markets while avoiding:
A. relocation of the company to other countries.
B. competition between companies in the global market.
C. trade risks.
D. trade barriers.
Question-40
Roch, a Swiss chocolate company, recently opened a manufacturing unit in Spain. The purpose of this move was that Roch wanted to avoid Spain's high import tariffs. Which of the following reasons prompted Roch to open the manufacturing unit in Spain?
A. Customer demands
B. Trade barriers
C. Globalization of competitors
D. Growth opportunities
