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Global Strategy: Competing Around The World

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Question 1
Free
Multiple Choice

Because keeping cost low is critical to IKEA's value innovation,it switched from a(n)

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A

transnational strategy to a multidomestic strategy.

B

transnational strategy to a global-standardization strategy.

C

international strategy to a multidomestic strategy.

D

international strategy to a global-standardization strategy.

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Question 2
Free
Multiple Choice

Although demand for IKEA's low-cost furnishings has increased,its annual store growth has slowed to fewer than ten new stores a year.Why has this happened?

Choose correct answer/s
A

IKEA has failed to hire top designers for its furniture.

B

IKEA's global supply chain has become bottlenecked.

C

IKEA has had a revolving door of CEOs for the past 20 years.

D

IKEA's holding companies are all located in Sweden.

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Question 3
Free
Multiple Choice

As a result of globalization,the

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A

economies around the world are becoming more independent.

B

cultural distance between countries is increasing.

C

cost of doing business around the world is increasing.

D

world's market economies are becoming more integrated.

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Question 4
Free
Multiple Choice

Jane is the CEO of a clothing brand,Diva Rule Inc.,which has retail stores and production units in five different countries.The firm's shareholders ensure the proper management of Diva Rule Inc.through their appointed board of directors.In this scenario,Diva Rule Inc.is most likely a

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A

nonprofit organization.

B

nationalized firm.

C

sole proprietorship.

D

multinational enterprise.

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Question 5
Free
Multiple Choice

European aircraft maker Airbus is investing $600 million in Mobile,Alabama,to build jetliners.Which of the following statements best explains why it is employing this strategy?

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A

to take advantage of the high labor costs in the southern United States

B

to take advantage of the high cost of living in the southern United States

C

to take advantage of the low impact of globalization in the United States

D

to take advantage of lower taxes in the southern United States

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Question 6
Multiple Choice

During the period of Globalization 1.0,the mode of entry into foreign markets primarily involved

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A
exporting goods.
B
making foreign direct investments.
C
making foreign institutional investments.
D
licensing production and distribution.
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Question 7
Multiple Choice

Which of the following is a feature of the Globalization 2.0 stage?

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A
Huge investments in fiber-optic cable networks around the world enabled companies to operate as global-collaboration networks.
B
Only sales and distribution operations took place overseas, while all the important business functions were located in the home country.
C
Two-way knowledge flow between the local subsidiaries and their U.S. headquarters was strong.
D
Multinational enterprises (MNEs) began to create smaller, self-contained replicas of themselves in a few key countries.
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Question 8
Multiple Choice

Which of the following is an observable feature in the Globalization 3.0 stage?

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A
Knowledge flow between the local replicas of the multinational enterprises and their U.S. headquarters is limited.
B
Only sales and distribution functions of a multinational enterprise are located in a few key countries.
C
Based on an optimal mix of costs, skills, and PESTEL factors, companies now freely locate business functions anywhere in the world.
D
Firms have reorganized from a global enterprise with different centers of expertise to a multinational company with self-contained operations in a few selected countries.
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Question 9
Multiple Choice

A trend observed during the Globalization 3.0 stage involves

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A
countries around the globe becoming more self-sufficient and independent.
B
multinational companies organizing as global-collaboration networks.
C
privately-owned firms getting nationalized.
D
world's market economies becoming less integrated.
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Question 10
Multiple Choice

How will an increase in coordinated economic and political integration between countries affect the world economy?

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A
The world's market economies will become self-sufficient and independent.
B
There will be gains in social welfare and living standards across the globe.
C
The cost of labor will further decline in emerging economies.
D
There will be a movement away from global-collaboration networks among multinational enterprises (MNEs).
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Question 11
Multiple Choice

How has China been affected by its one-child-per-family policy and appreciation of its currency?

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A
The purchasing power of its workforce has reduced.
B
The value added to production has reduced.
C
The standard of living within the economy has lowered.
D
The country's advantage in low-cost manufacturing has reduced.
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Question 12
Multiple Choice

Emirates,Etihad Airlines,and Qatar Airways are a threat to U.S.legacy carriers because they offer

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A
higher quality for lower costs for international routes.
B
higher quality for similar costs for U.S domestic routes.
C
similar quality for lower costs for international routes.
D
similar quality for lower costs for U.S domestic routes.
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Question 13
Multiple Choice

Which of the following has been a key driver for firms to expand globally during the Globalization 3.0 stage?

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A
benefits from lower labor costs in manufacturing and services
B
access to low-cost raw materials such as lumber and iron ore
C
low levels of economic growth in emerging economies
D
inefficient infrastructure in countries like China, which have brought down setting-up costs
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Question 14
Multiple Choice

India has been able to carve out a competitive advantage in business process outsourcing (BPO)primarily because

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A
it has emerged as a manufacturing powerhouse.
B
of an efficient infrastructure and high labor costs.
C
it has an abundance of uneducated workers who are highly trainable.
D
of an abundance of well-educated, English-speaking young people.
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Question 15
Multiple Choice

Unilever's new-concept center is situated in downtown Shanghai,China,attracting hundreds of eager volunteers to test the firm's latest product innovations on-site while Unilever researchers monitor consumer reactions.In this example,Unilever is trying to reap the benefits of

Choose correct answer/s
A
location economies.
B
economies of scope.
C
learning races.
D
network effects.
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Question 16
Multiple Choice

Ridemore Autos Inc.has shifted its research and development unit from its home country to Germany.This allows the company to be better informed about the latest developments in the automotive industry by tapping into the highly advanced automotive industry in Germany.In this scenario,Ridemore Autos Inc.is reaping the benefits of

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A
economies of scope.
B
location economies.
C
resource immobility.
D
resource ambiguity.
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Question 17
Multiple Choice

A firm is said to be pursuing a polycentric innovation strategy when

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A
its research facility is situated in the headquarters and all other business activities are located around the world.
B
it draws from multiple, equally important research facilities located throughout the world.
C
it restricts its innovation to Western economies and production to developing markets.
D
its knowledge flow takes a one-way path-from its headquarters to the subsidiaries.
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Question 18
Multiple Choice

Which of the following statements accurately explains the primary reason behind Walmart's failure in Germany?

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A
inability to implement its trademark focused-differentiation strategy in the German market
B
significant differences between its U.S. personnel policies and Germany's culture
C
Germany's unfamiliarity with retail discount powerhouses
D
Metro's hostile takeover of Walmart in Germany
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Question 19
Multiple Choice

Silca Electronics Inc.is a consumer-electronics company based in the country of Pelo.It has approximately 300 stores across the country and is already active in three foreign countries.It attempts to establish itself successfully in the country of Zevar,and uses its low-cost strategy to do so.However,due to the additional costs associated with training,coordinating across geographic distances,and other costs associated with doing business in an unfamiliar cultural and economic environment,Silca Electronics Inc.incurs huge financial losses in Zevar.In this scenario,Silca Electronics Inc.'s failure to establish itself successfully in Zevar occurs most likely because

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A
it overestimates its need to protect its intellectual property.
B
it underestimates its liability of foreignness when entering the Zevar market.
C
it underestimates its dwindling reputation before it enters the Zevar market.
D
it overestimates the geographic and cultural distance between Pelo and Zevar.
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Question 20
Multiple Choice

Japanese and European engineering companies entered China to participate in building the world's largest network of high-speed trains worth billions of dollars.Companies such as Kawasaki Heavy Industries (Japan),Siemens (Germany),and Alstom (France)were joint-venture partners with domestic Chinese companies.These firms now allege that the Chinese partners built on the Japanese and European partners' advanced technology to create their own,next-generation high-speed trains.This example best highlights the _____ that firms can experience when expanding overseas.

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A
threat of new entrants
B
liability of foreignness
C
loss of reputation
D
intellectual property exposure
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