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TITLE: Test 3

UNIVERSITY / INSTITUTE: Purdue University

CLASS / COURSE: MGMT 38000

QUESTION DESCRIPTION:

MGMT 38000 INTERNATIONAL BUSINESS

Title: Test 3
 
1.   When non-exporting firms are asked why they do not export, they generally list the following as problems: 
 
A. Locating foreign markets  
B. Payment and finance procedures  
C. Export procedures  
D. International marketing  
E. A, B and C    
 F. All of the above  
 
2.   The Department of Commerce organizes events that are helpful in both locating foreign representatives and making sales. Which of the following is not an event offered by the Department of Commerce? 
 
A. U.S. Pavilions  
B. Reverse trade missions  
C. Product literature center  
 D. Education seminars    
 
3. . Export marketing plans should be specific about: 
 
A. The markets to be developed  
B. The marketing strategy for servicing them  
C. The tactics required to make the strategy operational  
D. The management plan  
 E. A, B, and C    
F. A, B and D  
 
4.   Freight forwarders' responsibilities include all except: 
 
A. Booking space on a ship  
B. Preparing the export documents  
 C. Verifying that the seller has money in the bank      
D. Arranging to have the merchandise delivered to the port  
 
5.   Which is the principal government agency responsible for aiding the export of American goods and services through a variety of loan, guarantee, and insurance programs? 
 
 A. U.S. Export-Import Bank (Ex-Im Bank)      
B. Overseas Private Investment Corporation (OPIC)  
C. Foreign Sales Corporation (FSC)  
D. Major League Baseball (MLB)  
 
6.   The U.S. Export-Import Bank (Eximbank) offers the following: 
 
A. Export Credit Insurance  
B. Guarantees  
C. Direct and Intermediary Loans  
D. Working Capital Guarantee  
E. A, C and D  
 F. All of the above      
 
7.   Foreign trade zones are also called: 
 
A. Free trade zones  
B. Transit zones  
C. Free perimeters  
 D. Export processing zones  
E. A, C and D  
F. All of the above    
 
8.   An export bill of lading serves three purposes: 
 
A. A contract for carriage between the shipper and the carrier  
B. A receipt from the carrier for the goods shipped  
C. A certificate of ownership  
D. A receipt for the IRS  
 E. A, B and C      
F. A, B, and D  
 
9.   The collection of documents varies from country to country. The most common types of collection documents that the seller provides to the buyer include all of the following except: 
 
A. Commercial invoice  
B. Consular invoices  
 C. Income statement      
D. Certificate of origin  
 
10.   If merchandise on an American port is not cleared by customs, the would-be importer must: 
 
 A. Place them in a bonded warehouse    
B. Abandon them  
C. Send them to another country  
D. Sell them in a street near the port  
E. A, B and C are possible options    
F. All of the above  
 
11.   Marketers everywhere must: 
 
A. know the market.  
B. satisfy customers' needs.  
C. price goods and services so that they are acceptable to the market.  
D. B and C.  
 E. A, B, and C.      
 
12.   The international marketing manager's task is more complex than that of the domestic marketing manager because: 
 
A. marketing strategies must be developed by assessing potential markets and analyzing alternate marketing mixes.  
B. the international market is larger.  
C. the uncontrollable environment forces vary widely among markets.  
 D. A, B and C.      
 
13.   Management would prefer global standardization of the marketing mix: 
 
A. because each market demands it.  
 B. for cost savings.   
C. to meet local conditions.  
D. A and C.  
 
14.   In spite of the advantages of global standardization, many firms find it necessary to: 
 
A. use the domestic marketing mix overseas.  
 B. modify the present mix or develop a new one for overseas markets.      
C. use different marketing mixes overseas, to save money.  
D. A and C.  
 
15.   Buyers of __________ usually act on the same motives worldwide. 
 
A. impulse goods  
B. mass-consumption products  
 C. industrial products      
D. low-priced products  
 
16.   In the developing countries, there is a tendency to ____________________ industrial equipment. 
 
 A. overload and slight the maintenance of      
B. overprice and over design  
C. underprice and underdesign  
D. overprice and underdesign  
 
17.   Theodore Levitt says that Coca-Cola, Pepsi-Cola, and McDonald's all sell standardized products globally using standardized promotion. In reality, __________ 
 
A. only Coca-Cola does.  
B. only Pepsi-Cola does.  
C. only McDonald's does.  
D. only A and B do.  
 E. none does.      
 
18.   Generally, __________ products require greater modification to meet local market requirements worldwide. 
 
A. low priced  
B. maintenance  
 C. consumer      
D. industrial  
 
19.   Generally, as marketers go down the economic and social strata in each country, they will tend to find: 
 
A. similarities among countries with respect to social and cultural values.  
 B. dissimilarities among countries with respect to social and cultural values.      
C. no significant differences with respect to social and cultural values.  
D. greater government support for each succeeding lower stratum.  
 
20.   The need to change the color of packages when selling a product in a new market is generally a result of the influence of: 
 
A. distributive forces.  
B. competitive forces.  
C. political conflicts.  
 D. cultural differences.      
 
21.   According to the text, a brand name has been pirated: 
 
 A. when a firm's brand name has been registered by another firm, which is employing it for its own product's name.    
B. when it is registered by someone who hopes to profit by selling the name back to the originating firm.    
C. if it is being used by sailors who are criminals.  
D. A and C.  
 
22.   Of all the promotional mix elements, __________ is the one with the greatest similarities worldwide. 
 
A. public relations  
B. personal selling  
 C. advertising      
D. sales promotion  
 
23.   To avoid translation errors, the experienced advertising manager will use: 
 
A. plenty of illustrations with short copy.  
B. local translators.  
C. back translation.  
 D. A and C.   
 
24.   The effectiveness of every organization depends to a great extent on how well its: 
 
A. human resources are utilized.  
B. production facilities are operated.  
C. financial resources are planned.  
 D. all of the above.      
 
25.   Qualifications for a good manager of an overseas operation should include: 
 
 A. all of the below.      
B. being bicultural and bilingual.  
C. knowing business practices in the home and host countries.  
D. having more and different skills than domestic managers.  
 
26.   An ethnocentric staffing policy: 
 
A. utilizes host country nationals in key foreign management and technical positions.  
B. assigns expatriates who have learned the language and culture of the country of their assignment.  
C. Is required in order to prepare home country citizens for high-level managerial positions at headquarters.  
 D. none of the above.      
 
27.   Hiring and promoting employees on the basis of the specific local context in which the subsidiary operates refers to: 
 
A. an ethnocentric orientation.  
 B. a polycentric orientation.      
C. a regiocentric orientation.  
D. a geocentric orientation.  
 
28.   A polycentric staffing policy is appropriate when : 
 
 A. there are low levels of pressure for cost reduction and high levels for localization.      
B. information technology is of increasing importance.  
C. A, B, and D.  
D. international companies are entering India, where there are more women in management.  
 
29.   Home country nationals may be used in host country management because: 
 
 A. all of the below.      
B. host country nationals are unavailable.  
C. home country nationals are being groomed for IC headquarters.  
D. IC headquarters wants one of its nationals in the host country.  
 
30.   Training and development of potential candidates for expatriate assignments: 
 
A. is unnecessary with host country nationals.  
B. is unnecessary with home country nationals.  
 C. depends on whether the candidate is a home, host or third country national.      
D. wastes company resources because management is an art form, not a skill.  
 
31.   An advantage of hiring personnel who are citizens of neither the home country nor the host country is that they: 
 
A. may accept lower wages and benefits.  
B. may come from a culture similar to that of the host country.  
 C. A, B and D.      
D. have international experience.  
 
32.   Before accepting a foreign posting and becoming an expatriate, an executive should: 
 
A. arrange with someone fairly high in the home country company to be your mentor and look out for your interests.  
B. insist that the bosses tell you exactly what the company expects you to accomplish.  
C. try to assess how your family will adopt to the major changes involved.  
 D. all the above.      
 
33.   With regard to the use of women versus men for expat management assignments: 
 
A. Few qualified women candidates are available.  
B. Few women candidates are accepting assignments and enjoying the experience.  
 C. Those women who go into expatriate positions tend to do well. The hurdle is in getting the assignment.      
D. The women expatriates are making more money than their male counterparts.  
 
34.   For expatriate employees, the salary portion of the compensation package is: 
 
A. usually higher than employees at the same level in the home company.  
B. usually lower than employees at the same level in the home company.  
 C. usually within the range of the employees at the same level in the home company.      
D. usually on a separate, expatriate schedule.  
 
35.   Executive compensation packages sometimes include payments called perks that are extras and are: 
 
A. usually illegal.  
B. always legal.  
 C. uncommon.   
D. symbols of rank in the company hierarchy.    
 
36.   When an IC hires and trains local, host country people, the IC often: 
 
A. pays them too much and creates inflation.  
B. over-trains them to IC culture-based standards.  
 C. may lose them to local firms or other ICs once they are trained.      
D. encourages their transfer, causing brain drain.  
 
37.   The financial issues confronting IC management include: 
 
  Student Response Value Correct Answer Feedback
A. fluctuating currency exchange rates.  
B. tariffs, taxes, and inflation.  
C. accounting practices.  
 D. all of the above.      
 
38.   Transaction exposure: 
 
A. is a credit type risk.  
 B. is a currency exchange risk which arises when future payment in a foreign currency is involved.  
C. is a currency exchange risk resulting from translating values in foreign currencies to the home country currency.  
D. cannot be protected against.  
 
39.   A forward market hedge: 
 
 A. is accomplished by a contract in the foreign exchange market.    
B. involves credit.  
C. should be avoided.  
D. is rarely used.  
 
40.   Swap contracts are used to hedge: 
 
A. derivatives.  
B. foreign currency exposure.    
C. covered positions.  
 D. none of the above.  
 
41.   Leading or lagging payments: 
 
A. is more useful between unrelated companies than within an IC.  
B. usually profits both parties.  
C. does not permit either party to gain.  
 D. depends on an ability to predict currency movements.    
 
42.   The adoption of the euro has affected transaction exposure by: 
 
 A. reducing it for some ICs, significantly for ICs that are euro-based.      
B. expanding it.  
C. increasing the number of currency options available for hedging.  
D. B and C.  
 
43.   Transfer pricing may be used to: 
 
A. decrease IC taxes.  
B. fund exports only.  
C. reduce import duties.  
 D. A and C.    
 
44.   The attitudes of governments toward transfer pricing is: 
 
A. indifference.  
B. academic interest.  
C. encouragement.  
 D. suspicion.      
 
45.   Translation risk: 
 
 A. is a currency exchange risk resulting from translating values in foreign currencies to the home country currency.      
B. is a credit type risk.  
C. is a currency exchange risk that arises when future payment in a foreign currency is involved.  
D. cannot be protected against.  
 
46.   Parallel loans are useful to: 
 
A. save taxes.  
 B. avoid foreign exchange risk.    
C. save tariffs.  
D. save interest costs.  
 
47.   In raising capital, an IC can look: 
 
A. within its family of companies.  
B. at home or host country capital markets.  
C. at third country markets.  
 D. any of the above.      
 
48.   Switch trading calls for: 
 
A. bait and switch.  
 B. a third party to dispose of goods delivered by the developing nation.      
C. counterfeit goods.  
D. switching suppliers.  
 
49.   Derivatives: 
 
A. should not be used.  
 B. are financial instruments the values of which are tied to price movements of some commodity or other instrument.      
C. are instruments of title such as a bill of lading.  
D. are simple methods for an organization to hedge risks  
 
50. An example of the counterpurchase version of countertrade is: 
 
 A. Pepsi Co.'s arrangement with Russia to sell Pepsi Cola there in exchange for which Pepsi Co. has exclusive rights to export Russian vodka.      
B. Dresser's arrangement with Poland to take tractors produced there with Dresser supplied technology.  
C. bringing in a third party to dispose of developing nation products that are difficult to sell.  
D. production of part of a product and/or assembly in the developing nation.  

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