GLOBAL STRATEGY: Test Bank/Chapter One

CHAPTER 1 STRATEGIZING AROUND THE GLOBE TEST BANK TRUE/FALSE QUESTIONS 1. The opening case is an examp e o! ho" the p#$ ishing in%#str& no" re'#ires a sim# taneo#s penetration o! a markets rather than tr&ing to "in one market a!ter another. a. Tr#e b. False AACSB: B(S)ROG: Ana &tic* +,SC: Strateg&* LO: 1-1* B oom.s: Comprehension* +i!!ic# t&: Eas& /. ,n the opening case0 the !orma r# es in China state% that !oreign companies co# % not p#$ ish $ooks on their o"n. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: En2ironmenta ,n! #ence LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 4. ,n China0 po itica correctness ma& nee% to $e consi%ere% "hen making re!erence to Tai"an. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: En2ironmenta ,n! #ence LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 5. The c osing case i #strates ho" to strategica & !oc#s on the $ase o! the g o$a economic p&rami% an% to %o so s#ccess!# &. a. Tr e $. 1a se AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Strateg& LO: 1-4* B oom.s: Comprehension* +i!!ic# t&: Eas& 6. A S7OT ana &sis resonates 2er& "e "ith S#n T8#.s teachings. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-4* B oom.s: Ana &sis* +i!!ic# t&: 9o%erate :. ,! a strateg& ;theor&< is tr# & s#ccess!# 0 it "i "ork not =#st !or one !irm $#t !or a others as "e . a. Tr#e b. False AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Strateg& LO: 1-5* B oom.s: App ication* +i!!ic# t&: 9o%erate >. +etermining the scope o! the !irm in2o 2es not on & gro"th o! the !irm $#t a so
1

GLOBAL STRATEGY: Test Bank/Chapter One

contraction. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas&

?. The text stresses that rea ism in%icates that a companies sho# % @go g o$a A an% en%ea2or to %o so as '#ick & as possi$ e in 2ie" o! the 2ast opport#nities that exist. a. Tr#e b. False AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& B. The in%#str&-$ase% 2ie" posits that the %egree o! competiti2eness in an in%#str& arge & %etermines !irm per!ormance. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1C. The reso#rce-$ase% 2ie" s#ggests that !irm-speci!ic capa$i ities %o not %ri2e per!ormance %i!!erences. a. Tr#e b. False AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas&

11. The instit#tion-$ase% 2ie" arg#es that instit#tiona !orces pro2i%e an ans"er to simi arities in !irm per!ormance $#t not %i!!erences. a. Tr#e b. False AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1/. As i #strate% $& Cengage Learning.s penetration o! the China market "ith Global Strategy ;opening case<0 the i%ea that !irms m#st @think g o$a an% act oca A sim# taneo#s & is simp & not possi$ e. a. Tr#e b. False AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Creation o! Da #e LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 14. The ear iest 9EEs existe% in some !orm tho#san%s o! &ears ago in the Ass&rian0 )hoenician0 an% Roman empires. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: En2ironmenta ,n! #ence
/

GLOBAL STRATEGY: Test Bank/Chapter One

LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 15. Accor%ing to the text0 to%a&.s most s#ccess!# 9EEs !ar excee% the historica c o#t o! some 9EEs s#ch as Britain.s East ,n%ia Compan& %#ring co onia times. a. Tr#e b. False AACSB: B(S)ROG: Ana &tic* +,SC: Creation o! Da #e LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 16. +#ring the secon% ha ! o! the t"entieth cent#r&0 Fong 3ong0 Singapore0 So#th 3orea0 an% Tai"an0 re!#se% to participate in the g o$a econom& an% $ecame kno"n as the @1o#r Tooth ess Tigers.A a. Tr#e b. False AACSB: B(S)ROG: Ana &tic* +,SC: 9oti2ation Concepts LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1:. +#ring the 1BBCs there "as an increase in $oth g o$a tra%e an% opposition to g o$a tra%e. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1>. Semig o$a i8ation in2o 2es %oing $#siness in either the northern or so#thern hemisphere $#t not $oth. a. Tr#e b. False AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1?. Beginning in the ate 1BBCs an% ear & t"ent& !irst cent#r&0 a corporate go2ernance crisis has %e2e ope%. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: En2ironmenta ,n! #ence LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1B. Accor%ing to the text0 $#siness st#%ents ma& ten% to !oc#s more on the economic gains o! g o$a i8ation0 an% $e ess concerne% "ith its %arker si%es. a. Tr e $. 1a se AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: 9oti2ation Concepts LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& /C. A ot o! opponents o! g o$a i8ation are nongo2ernmenta organi8ations ;EGOs<0

GLOBAL STRATEGY: Test Bank/Chapter One

s#ch as en2ironmenta ists an% cons#mer gro#ps. a. Tr e $. 1a se AACSB: B(S)ROG: Ana &tic* +,SC: Gro#p +&namics LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas&

!ULTIPLE CHOICE QUESTIONS 1. a. $. c. ". e. 9# tinationa enterprises ;9EEs< are !irms that: Engage in !oreign %irect in2estment ;1+,<. +irect & contro 2a #e-a%%ing acti2ities in other co#ntries. 9anage 2a #e-a%%ing acti2ities in other co#ntries. All #$ %&e ab#'e. Eone o! the a$o2e. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas&

/. a. $. c. %.

7hich o! the !o o"ing $est %escri$es !oreign %irect in2estment ;1+,<G A $(r)*s "(re+% (,'es%)e,% (, -r#" +%(#, a,"/#r ser'(+e a+%('(%(es abr#a". The p#rchases o! !oreign sec#rities $& peop e "ithin the (.S. The p#rchases o! (. S. sec#rities $& peop e !rom other co#ntries. A2oi%ance o! $rokers or other !inancia interme%iaries "hen making !oreign in2estments. e. B an% C a$o2e. AACSB: B(S)ROG: Ana &tic* +,SC: 9oti2ation Concepts LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 4. a. $. +. %. e. 7hich o! the !o o"ing $est %e!ines @Tria%A as the term is #se% in the textG The (.S.0 Hapan0 an% German&. The (.S.0 Cana%a0 an% 9exico. N#r%& A)er(+a. E r#-e. a," /a-a,. Eorth America0 E#rope0 an% Asia. The (.S. %o ar0 the E#ro0 an% the Yen. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-1* B oom.s 3no" e%ge* +i!!ic# t&: Eas&

5. Accor%ing to the text0 the c#rrent $ran% o! @g o$a strateg&A seems re e2ant on & !or 9EEs !rom:
5

GLOBAL STRATEGY: Test Bank/Chapter One

a. b. c. %. e.

BR,C. T&e Tr(a". O)EC nations. EA1TA. The E. (. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas&

6. Emerging economies ;or emerging markets<: a. Eo" comman% a !# one-thir% o! the "or %"i%e 1+, ! o". $. Comman% ha ! o! the g o$a gross %omestic pro%#ct ;G+)< meas#re% at p#rchasing po"er parit&. +. A a," B ab#'e %. +espite their gro"th0 the& sti comman% ess than 1CI o! g o$a G+). e. Consist o! co#ntries "hich are in a state o! %ec ine $#t "hich are $e ie2e% to ha2e potentia !or gro"th. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& :. a. $. c. %. e. BR,C re!ers to: Bahrain0 R#ssia0 ,ran0 an% China. Bo i2ia0 Romania0 ,n%ia0 an% Co #m$ia. B# garia0 Romania0 ,ra'0 an% China. Berm#%a0 R"an%a0 ,ra'0 an% the C8ech Rep#$ ic. Bra0(l. R ss(a. I,"(a. a," C&(,a. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 9an& BR,C oca !irms are: E!!ecti2e & competing at home. La#nching o!!ensi2es a$roa%. Creating serio#s rami!ications !or Tria%-$ase% 9EEs. All #$ %&e ab#'e. BR,C oca !irms ha2e &et to $ecome signi!icant g o$a &. AACSB: B(S)ROG: Ana &tic* +,SC: En2ironmenta ,n! #ence LO: 1-1* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& Strateg&: +ates $ack to 6CC$c an% the "ork o! the strategist S#n T8# o! China. App ies concepts %e2e ope% $& the strategist 2on C a#se"it8. ,nc #%es app ication o! princip es o! mi itar& strateg& to $#siness competition. All #$ %&e ab#'e. ,n this cent#r&0 ci2i ian companies no onger app & mi itar& theories an%
6

>. a. $. c. ". e.

?. a. $. c. ". e.

GLOBAL STRATEGY: Test Bank/Chapter One

princip es in %ea ing "ith competition. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-4* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& B. a. b. c. %. e. A ha mark o! theor& $#i %ing an% %e2e opment is: The o#tcome o! a test. Re-l(+a%(#,. ,nt#ition. Consens#s. Lack o! contro2ers&. AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Creation o! Da #e LO: 1-4* B oom.s: Ana &sis* +i!!ic# t&: 9o%erate

1C. O2era 0 strateg& is: a. A r# e$ook. $. A $ #eprint. c. A set o! programme% instr#ctions. %. A o! the a$o2e. e. N#,e #$ %&e ab#'e. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-4* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 11. 9#ch o! o#r kno" e%ge a$o#t @the !irmA is !rom research on !irms in: a. A,1l#2A)er(+a, +a-(%al(s). $. Hapan a!ter 7or % 7ar ,,. c. German mathematica mo%e s. %. Emerging markets. e. The ear & in%#stria era. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1/. The "or% JJJJJJJhas no" $ecome the most !amo#s Chinese $#siness "or% to appear in Eng ish- ang#age me%ia. a. 3eirets# b. G a,3( c. Chae$o %. B at e. Eone o! the a$o2e. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas&

GLOBAL STRATEGY: Test Bank/Chapter One

14. The JJJJJJJ 2ie" primari & !oc#ses on the JJJJJJ in a S7OT ana &sis. a. I," s%r42base". OT $. Reso#rce-$ase%0 OT c. ,n%#str&-$ase%0 S7 %. Reso#rce-$ase%0 S7 e. ,n%#str& an% reso#rce0 S7OT AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: Comprehension* +i!!ic# t&: 9o%erate 15. As sho"n in the c osing case0 the in!orma r# es o! the game: a. 9#st $e a2oi%e% $eca#se g o$a $#siness is not a mere game. $. Are not app ica$ e in c# t#res in "hich ten% to $e 2er& !orma . c. O!ten re'#ire that the !irm seek to change the in!orma r# es instea% o! going a ong "ith those r# es. ". Nee" %# be ,"ers%##" b4 $(r)s. e. Are $eing rep ace% $& !orma r# es. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 16. +i2ersi!ication: a. 7as acc aime% in the 7est %#ring the 1B:Cs an% 1B>Cs $#t "as %iscre%ite% t"ent& &ears ater. $. ,s $e ie2e% $& 7estern me%ia to %estro& 2a #e in emerging economies. c. Fas res# te% in higher pro!ita$i it& !or some in emerging economies than in%epen%ent !irms. %. ,n emerging economies ma& $e a !#nction o! the e2e o! instit#tiona ;#n%er< %e2e opment. e. All #$ %&e ab#'e. AACSB: B(S)ROG: Ana &tic* +,SC: Creation o! Da #e LO: 1-5* B oom.s: Ana &sis* +i!!ic# t&: Cha enging 1:. @G o$a strateg&A re!ers to: a. A partic# ar theor& on ho" to compete. $. O!!ering stan%ar%i8e% pro%#cts an% ser2ices on a "or %"i%e $asis. c. An& strateg& o#tsi%e one.s home co#ntr&. %. Strateg& o! !irms aro#n% the g o$eKessentia & 2ario#s !irms. theories a$o#t ho" to compete s#ccess!# &. e. All #$ %&e ab#'e. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-4* B oom.s: 3no" e%ge* +i!!ic# t&: 9o%erate 1>. G o$a i8ation is 2ie"e% as: a. A ne" !orce s"eeping thro#gh the "or % in recent times.
>

GLOBAL STRATEGY: Test Bank/Chapter One

$. c. ". e.

A ong-r#n historica e2o #tion since the %a"n o! h#man histor&. A pen%# #m that s"ings !rom one extreme to another !rom time to time. All #$ %&e ab#'e. Eone o! the a$o2e. AACSB: B(S)ROG: Ana &tic* +,SC: En2ironmenta ,n! #ence LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: 9o%erate

1?. 7hich o! the !o o"ing "ere the !irst to express concern a$o#t internationa competition !rom o"-cost co#ntriesG a. American po itica ea%ers in the t"ent& !irst cent#r&. $. (nion ea%ers in the ast ha ! o! the t"entieth cent#r&. c. American $#siness ea%ers in the ate 1?CCs. %. The 3ing o! Eng an% in the ate 1>CCs. e. A $(rs% +e,% r4 R#)a, e)-er#r. AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: En2ironmenta ,n! #ence LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& 1B. The c#rrent era o! g o$a i8ation originate% in the a!termath o!: a. 7or % 7ar ,. b. 5#rl" 5ar II. c. The 3orean Con! ict. %. The Dietnam Con! ict. e. The G# ! 7ar. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: Eas& /C. At the %a"n o! the /1st cent#r&0 JJJJJJJJJJ ha% signi!icant rami!ications !or companies an% strategists aro#n% the "or %. a. Antig o$a i8ation protests $. Terrorist attacks c. Corporate go2ernance crisis ". All #$ %&e ab#'e e. Eone o! the a$o2e AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-6* B oom.s: 3no" e%ge* +i!!ic# t&: 9o%erate

GLOBAL STRATEGY: Test Bank/Chapter One

SHORT ANS5ER ESSA6 QUESTIONS 1. Fo" can princip es o! mi itar& strateg& $e #se!# in %e2e oping a g o$a $#siness strateg&G Exp ain $& #sing S7OT ana &sis. Students may point out that military strategy involves developing a clear idea of goals and objectives, an understanding of the barriers to achieving those objectives (such the opponents), the development of capabilities to overcome those barriers and the selection of the best alternative means of achieving the objectives under specific circumstances. Business firms can benefit by doing the same thing. They need to start by examining their current situation hich includes an understanding of their internal strengths (S) and ea!nesses (") and ho that can affect the strategy they use to deal ith their external opportunities (#) and threats (T). AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-4* B oom.s: App ication* +i!!ic# t&: 9o%erate

/. The text points o#t that not a !irms sho# % go g o$a . ,n 2ie" o! the 2ast opport#nities0 "h& sho# % some !irms not p#rs#e internationa $#sinessG $any ill point out that success in one mar!et or part of the orld does not assure that the firm ill be able to be successful ith its product and strategy in some other part. $uch depends on hether it ill be able to modify its product or its strategy so as to be successful in the country it see!s to enter. Timing may also be off either in terms of mar!et readiness or development of the firm%s capabilities. AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: Strateg& LO: 1-5* B oom.s: Comprehension* +i!!ic# t&: Eas& 4. Fa2ing 2a #a$ e0 #ni'#e0 an% har%-to-imitate capa$i ities ma& $e a%2antageo#s in %oing $#siness g o$a &. Fo"e2er0 "hat is the pro$ em "ith tr&ing to maintain that a%2antageG There are many possible ays to ans er this &uestion. Some may argue that it is much li!e being on a treadmill in hich one must !eep moving for ard just to stay in place. "hat is valuable today may lose its value as changes occur in technology and mar!ets. #ther firms in other parts of the orld may develop alternatives that imitate or even exceed one%s capabilities or render them no longer uni&ue. 's firms expand production around the orld, they may in fact be helping to train others to compete ith them. AACSB: B(S)ROG: Ana &tic* +,SC: Strateg& LO: 1-5* B oom.s: Comprehension* +i!!ic# t&: Eas&

GLOBAL STRATEGY: Test Bank/Chapter One

5. 7h& is there a $ack ash against g o$a i8ation0 an% ho" %o aspects o! that $ack ash act#a & enhance g o$a i8ationG 's the text points out, many incorrectly assume that globali(ation is a ne force that is enabling emerging economics to ta!e a ay both lo )end manufacturing jobs high)end jobs as ell hile enabling $*+%s to destroy local companies, local cultures and values as ell and the environment. *G#%s (*on Government #rgani(ations) have focused on various abuses (real or alleged) and brought about a public debate regarding the relative positive and negative outcomes involved in globali(ation. 's a result, social responsibility, ethics, and governance, long regarded as ,bac!burners,- have no increasingly become central topics for strategy discussions. To the extent that $*+%s can effectively counter misunderstandings and positively respond to valid concerns, they may be able prevent or overcome barriers to global trade and investment. AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: En2ironmenta ,n! #ence LO: 1-6* B oom.s: Ana &sis* +i!!ic# t&: Cha enging 6. As &o# examine the c#rrent po itica 0 socia 0 an% economic en2ironment o! &o#r co#ntr& an% the "or % as o! the moment &o# are rea%ing the text0 "hat is &o#r estimate o! the extent to "hich g o$a i8ation "i increase or %ecrease in the short r#nG ,n the ong r#nG The response is li!ely to be specific to the national and cultural bac!ground of the student and the major ne s events at the time the student is ta!ing the course. The text has sho n that there is a pendulum that tends to s ing bac! and forth in regards to the acceptance or resistance of globali(ation but the long run trend appears to be moving to ard greater globali(ation. .o ever, the future is not al ays li!e the past and even long)term trends can be reversed. 's a result, some students may have reasons hy they feel that there ill be increasing barriers to globali(ation in the future. "hatever the response, this &uestion is one in hich the ans er is not as important as the thought process that goes into it. AACSB: B(S)ROG: Re! ecti2e Thinking* +,SC: En2ironmenta ,n! #ence LO: 1-6* B oom.s: E2a #ation* +i!!ic# t&: Cha enging

1C