Market Strategic Alliance Trivia Questions
.
- 1.Strong pressures for local responsiveness emerge when customer tastes and preferences
- A.
Differ significantly between countries.
- B.
Differ slightly between countries.
- C.
Are universally alike.
- D.
Are cyclical in nature.
- E.
None of the above.
- 2.Which of the following entry modes allow(s) a company to engage in global strategic coordination?
- A.
Exporting
- B.
Licensing
- C.
Joint ventures
- D.
Wholly owned subsidiaries
- E.
Joint ventures and wholly owned subsidiaries
- 3.A key to making a strategic alliance work is
- A.
Having one partner handle daily operations.
- B.
Selecting the right partner.
- C.
Sharing all knowledge.
- D.
Enforcing one culture for both partners.
- E.
Reducing investment in the alliance to a minimum.
- 4.Which of the following is not a risk of exporting?
- A.
Tariff barriers
- B.
Transportation costs
- C.
Location diseconomies
- D.
Prime interest rates
- E.
Delegation of marketing activities to a local agent
- 5.In which of the following circumstances does a localization strategy make the most sense?
- A.
Global market standardization is not possible, and there are no significant economies of scale to be realized from centralizing global manufacturing.
- B.
Global market standardization is possible, but there are no significant economies of scale to be realized from centralizing global manufacturing.
- C.
Global market standardization is not possible, but there are significant economies of scale to be realized from centralizing global manufacturing.
- D.
Global market standardization is possible, and there are significant economies of scale to be realized from centralizing global manufacturing.
- E.
Consumer tastes and preferences differ among national markets, and economies of scale are substantial.
- 6.Global economies of scale can be realized by
- A.
Expansion of overseas sales.
- B.
Better utilization of production facilities.
- C.
Boosting bargaining power with suppliers.
- D.
Increasing cost savings through learning effects.
- E.
All of the above.
- 7.Which of the following companies increased company growth rates by developing products at home and then expanding sales of these products in international markets?
- A.
Procter & Gamble
- B.
Ford
- C.
Toyota
- D.
All of the above
- E.
None of the above
- 8.Firms should choose likely countries for an international expansion effort based on all of the followingexcept the
- A.
Size of the market.
- B.
Existing wealth of consumers in that market.
- C.
Likely future wealth of consumers in that market.
- D.
Political stability of that market.
- E.
Age of the country.
- 9.Global expansion
- A.
Is feasible only for large companies.
- B.
Can enable companies to increase their profitability and grow their profits more rapidly.
- C.
Allows domestic companies in the mature stage of the industry life cycle to maintain profits but not to increase them.
- D.
Requires locating facilities in foreign countries.
- E.
Makes sense for manufacturing firms but not for service firms.
- 10.Foreign subsidiaries play a major role in shaping the future direction of a company pursuing a(n)
- A.
Transnational strategy.
- B.
International strategy.
- C.
Localization strategy.
- D.
Joint venture.
- E.
Global standardization strategy.
- 11.A company that enters a foreign market by entering into a licensing agreement with a local company
- A.
Can realize location economies.
- B.
Can engage in global strategic coordination.
- C.
Can realize experience-curve effects.
- D.
Can realize experience-curve effects. risks losing control over its technology to the venture partner. risks losing control over its technology to the venture partner.
- E.
Can engage in global strategic coordination and realize experience-curve effects.
- 12.What are the risks associated with licensing as a means of entering overseas markets?
- A.
Licensing limits a company's ability to coordinate strategic moves across countries.
- B.
A company may lose control of its technology.
- C.
A company may lose control over its manufacturing, marketing, and strategic functions.
- D.
All of the above.
- E.
None of the above.
- 13.A nation's companies gain competitive advantage if their domestic customers are
- A.
Nondemanding purchasers.
- B.
Able to obtain products or services in other countries.
- C.
Sophisticated and demanding.
- D.
Willing to spend money on novelties.
- E.
Not willing to accept low-priced products.
- 14.Which of the following has occurred in international trade over the past half-century?
- A.
There has been a dramatic lowering of barriers to international trade.
- B.
Tariff rates on manufactured goods traded by advanced nations have fallen.
- C.
Regulations prohibiting foreign companies from entering domestic markets and establishing production facilities have been removed.
- D.
The volume of world trade has increased dramatically.
- E.
All of the above.
- 15.Most manufacturing companies begin their global expansion by
- A.
Licensing.
- B.
Franchising.
- C.
Exporting.
- D.
Forming a joint venture.
- E.
Setting up a wholly owned subsidiary in the host country.
- 16.Which of the following factors increases pressures for cost reductions?
- A.
Differences in distribution channels
- B.
Increasing national wealth
- C.
Great transportation needs
- D.
High switching costs
- E.
Price as the main competitive weapon in a market
- 17.Attaining a credible commitment from a potential partner
- A.
Is a step in partner selection.
- B.
Requires the ability to share skills with partners.
- C.
Requires the ability to learn from alliance partners.
- D.
Is a way to minimize opportunism.
- E.
Requires the ability to share skills with and learn from alliance partners.
- 18.Cost reduction pressures can be particularly intense in industries producing
- A.
Commodity-type products.
- B.
Highly differential products.
- C.
Goods that do not compete on the basis of price.
- D.
Goods servicing narrowly defined markets.
- E.
Highly advertised goods.
- 19.The ability to realize cost economies from global volume is greatest in the case of
- A.
Products that need to be customized to local requirements.
- B.
Commodity-type products that serve universal needs.
- C.
Low-weight, high-value products that can be differentiated by global companies.
- D.
Products that can be economically manufactured in small batches.
- E.
Companies competing in industries where they face a large number of multinational competitors.
- 20.Factors of production include all but which of the following?
- A.
Land
- B.
Labor
- C.
Raw materials
- D.
Ethnic diversity
- E.
Managerial sophistication
- 21.When entering an overseas market, which of the following factors should be considered?
- A.
Size of the market
- B.
Purchasing power
- C.
Consumer demand for the company's product
- D.
Economic risks
- E.
All of the above
- 22.Which entry mode gives a multinational the tightest control over foreign operations?
- A.
Exporting from the home country and letting a foreign agent organize local marketing
- B.
Licensing
- C.
Franchising
- D.
Entering into a joint venture with a foreign company to set up overseas operations
- E.
Setting up a wholly owned subsidiary
- 23.When a company increases its growth rate by taking goods or services developed at home and selling them internationally, it is
- A.
Leveraging its existing products.
- B.
Taking the path of least resistance.
- C.
Engaging in product positioning.
- D.
Realizing cost economies from global expansion.
- E.
Realizing location economies.
- 24.Which of the following isnot a necessity for leveraging the skills of global subsidiaries?
- A.
The firm must have incentives for local managers to share knowledge and ideas.
- B.
The firm's managers must be aware that competencies can develop anywhere.
- C.
The firm must be pursuing a strategy of differentiation.
- D.
The firm's managers must help to transfer competencies around the company.
- E.
The firm must offer incentives that encourage employees to take necessary risks.
- 25.A localization strategy is most appropriate when
- A.
There are relatively few differences from one location to another.
- B.
Consumer tastes and preferences are universally similar.
- C.
Consumer tastes and perferences differ substantially across nations.
- D.
There is no need to customize products.
- E.
Local demand and national demand are equal.
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