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Exam 7: International Strategy: Creating Value in Global Markets

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Question 61

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In the Porter Diamond of National Advantage framework,which of the following factors does not affect nation competitiveness?

A) The position of the nation in factors of production necessary to compete in a given industry.
B) The presence or absence in the nation of internationally competitive supplier industries.
C) The conditions in the nation governing the nature of foreign rivalry.
D) The nature of home-market demand of the products or services of the industry.

E) All of the above
F) C) and D)

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Question 62

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Arbitrage opportunities in global financial markets are more attractive to global companies than local corporations,because they enable them to buy in huge volume and therefore increase their bargaining power with suppliers.

A) True
B) False

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Question 63

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The shift in the global automobile market over the past several years,in which China supplanted the U.S.at the largest market for automobiles in 2009,is an example of how the structure of the global economy is unchanging.

If the U.S.dollar appreciates relative to foreign currency,what is likely to be the result for the U.S.company that has branches abroad?

The Nestle line of pizzas marketed in the United Kingdom includes cheese with ham and pineapple topping on a French bread crust.This is an example of company adaptation to global markets.

Panasonic needed to change its strategy in the 1980s in order to respond to demographic and economic changes in China.As the Chinese middle class began to emerge,local companies responded with competitive products.Panasonic then changed its strategy from a transnational strategy to a global strategy.

Demanding domestic consumers tend to push firms to move ahead of companies in other countries where consumers are less demanding and more complacent.

GE Healthcare developed a portable,inexpensive ultrasound device for the emerging Chinese market.It expects to sell the device in the United States at a price cheap enough for every physician,paramedic,and emergency room nurse to purchase.This is an example of

In considering the transnational strategy,Nestle evaluates the limits of decentralization.The closer they are to the consumer in activities such as branding and pricing,the more then tend to decentralize.The more they deal with production and logistics,the more they centralize decision-making.The production and logistics decisions involve _______ activities.

Which of the factors below has not made the software services industry in India extremely competitive on a global scale?

A franchise generally expires after a few years,whereas a license is designed to last into perpetuity.

Reverse innovation occurs when a company develops a product that meets the needs of a developed country and then adapts it to the needs of the developing country.

According to the textbook,_______________ economic integration has progressed as a faster pace than _________ economic integration.

In considering the decision to offshore,which of the following generally is not one of the hidden costs?

The Indian software industry has become one of the leading global markets for software.The industry has grown to over 60 billion USD,and Indian IT firms provide software and services to over half the Fortune 500 firms.This success is being driven by factor endowments such as a large,growing market with sophisticated customers.

Which of the following is not a motivation for a company to pursue international expansion?

Wholly owned subsidiaries are least appropriate where a firm already has the appropriate knowledge and capabilities that it can leverage rather easily through multiple locations.

Increasing international exchange in goods and services can run into the difficulty of having one offer that meets the needs of customers at differing income levels.

Since the strategies and tactics to differentiate products and services to local markets can involve additional expenses,company costs will tend to fall.

A report issued by the World Trade Organization described the production of a particular U.S.car.The study showed that 30 percent of the car value goes to Korea for assembly,17.5 percent to Japan for components and advanced technology,7.5 percent to Germany for design,4 percent to Taiwan and Singapore for minor parts,2.5 percent to U.K.for advertising and marketing services,and 1.5 percent to Ireland and Barbados for data processing.This is an example of