ch7 Flashcards
Which of the following is not a risk normally associated with Bottom of the Pyramid strategies? A. , A low-end version of a brand may detract from the overall brand attractiveness.B. , The new low-cost products they develop may cannibalize the sales of their core products.C. , Entrenched competitors can impact the ability of the new firm to enter the market successfully.D. , New products may be perceived as exploiting the privileged customer with substandard products.
D. , New products may be perceived as exploiting the privileged customer with substandard products
Multinational firms are constantly faced with the dilemma of choosing between _______ and __________. A. , local adaptation; global integrationB. , local adaptation; local integrationC. , global adaptation; local integrationD. , global adaptation; global integration
A. , local adaptation; global integration
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 supplier industries that are internationally competitive.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.
C. , The conditions in the nation governing the nature of foreign rivalry.
Rivalry is intense in nations with conditions of __________ consumer demand, __________ supplier bases, and __________ new entrant potential from related industries. A. , weak; weak; highB. , strong; strong; lowC. , weak; weak; lowD. , strong; strong; high
D. , strong; strong; high
According to Michael Porter, firms that have experienced intense domestic competition are _________________________________. A. , unlikely to have the time or resources to compete abroadB. , more likely to demand protection from their governmentsC. , most likely to design strategies aimed primarily at the domestic marketD. , more likely to design strategies and structures that allow them to successfully compete abroad
D. , more likely to design strategies and structures that allow them to successfully compete abroad
Which of the factors below has not made the software services industry in India extremely competitive on a global scale? A. , large pool of skilled workersB. , large network of public and private educational institutionsC. , tax and antitrust legislation that protects the dominant players in the industryD. , large, growing market and sophisticated customers
C. , tax and antitrust legislation that protects the dominant players in the industry
Which of the following is not a motivation for a company to pursue international expansion? A. , It wishes to increase the size of the potential markets for its products and services.B. , It wishes to take advantage of arbitrage opportunities in order to increase profit.C. , It wishes to optimize value-chain activities to enhance performance, reduce costs, and reduce risk.D. , It wishes to increase foreign market penetration by developing products for the home market.
D. , It wishes to increase foreign market penetration by developing products for the home market.
If a company is considering optimizing the physical location for every activity in the value chain, which of the following is not a possible strategic advantage for that decision? A. , Performance enhancementB. , Cost reductionC. , Political risk reductionD. , Life-cycle enhancement
D. , Life-cycle enhancement
The sale of Boeing commercial aircraft and Microsoft operating systems in many countries enables these companies to benefit from ____________. A. , higher prices in their domestic marketsB. , reducing their exposure to currency risksC. , economies of scaleD. , optimizing the location for many activities in their value chain
C. , economies of scale
If the U.S. dollar appreciates relative to foreign currency, what is likely to be the result for the U.S. company that has company branches abroad? A. , Profits will increase, when measured in U.S. dollars.B. , Profits will decrease, when measured in U.S. dollars.C. , Foreign exports to the United States will decrease.D. , Foreign demand for U.S. goods and services will decrease.
B. , Profits will decrease, when measured in U.S. dollars.
__________ occurs when a firm decides to utilize other firms to perform value-creating activities that were previously performed in-house. A. , OffshoringB. , A global strategyC. , OutsourcingD. , A transnational strategy
C. , Outsourcing
In considering the decision to offshore, which of the following generally is not one of the hidden costs? A. , Total wage costs and indirect costsB. , Increased inventory and coordination costsC. , Reduced market responsiveness and intellectual property rightsD. , Wage deflation
D. , Wage deflation
Which one of the following is one of the Theodore Levitt assumptions supporting a pure global strategy? A. , Consumers are willing to pay more for specific product features.B. , Customer needs and interests are becoming more dissimilar.C. , MNCs can successfully compete globally by aggressively pricing products at the sacrifice of product features.D. , If the world markets are treated as heterogeneous, substantial economies of scale are easily achieved.
C. , MNCs can successfully compete globally by aggressively pricing products at the sacrifice of product features.
When firms expand into global markets, they are faced with the choice of reducing costs and/or adapting to the local market. When high pressures exist to lower costs, companies should choose a __________ or __________ in order to compete in the global marketplace. A. , global strategy; transnational strategyB. , global strategy: multidomestic strategyC. , international strategy; multidomestic strategyD. , international strategy; transnational strategy
A. , global strategy; transnational strategy
When firms expand into global markets, they are faced with the choice of reducing costs and/or adapting to the local market. When high pressures exist to adapt locally, companies should choose a __________ or __________ in order to compete in the global marketplace. A. , global strategy; transnational strategyB. , global strategy: multidomestic strategyC. , international strategy; global strategyD. , transnational strategy; multidomestic strategy
D. , transnational strategy; multidomestic strategy
Which would be the appropriate strategy for companies to use to compete in the global marketplace if the marketplace pressure is for lower costs with little pressure for local adaptation? A. , international strategyB. , global strategyC. , multidomestic strategyD. , transnational strategy
A. , international strategy
High pressure for local adaptation combined with low pressure for lower costs would suggest what type of international strategy? A. , global strategyB. , multidomestic strategyC. , transnational strategyD. , overall cost leadership strategy
B. , multidomestic strategy
Software Tech, Inc., a company in the computer software industry, invests heavily in Research and Development, and product design. Thus, most of its value is added ________. A. , upstreamB. , in its infrastructureC. , downstreamD. , midstream
A. , upstream
Industries in which proportionally more value is added in __________ activities are more likely to benefit from a global strategy. A. , downstreamB. , upstreamC. , marketingD. , sales
B. , upstream
Which of the following types of international firms are most likely to benefit from a global strategy as opposed to a multidomestic strategy? A. , firms that compete in industries in which consumer preferences vary substantially in each countryB. , firms in industries that are expanding very rapidlyC. , firms in industries that have value added by sales and marketing departmentsD. , firms in industries that have much value added in research and design or manufacturing
D. , firms in industries that have much value added in research and design or manufacturing
, Recent trends that might lead managers of multinational corporations (MNCs) to adopt a more decentralized strategy for their operations would include all of the following EXCEPT ______. A. , customer needs, interests, and tastes becoming increasingly homogenizedB. , consumers around the world increasingly willing to tradeoff idiosyncratic preferences in product features for lower priceC. , flexible manufacturing trends allowing a decline in the minimum volume required to reach acceptable levels of production efficiencyD. , fluctuating exchange rates
A. , customer needs, interests, and tastes becoming increasingly homogenized
Firms following a global strategy strive to offer __________ products and services as well as locate manufacturing, Research and Development, and marketing activities in a limited number of locations. A. , widely differentiatedB. , more expensive localC. , internationally differentiatedD. , standardized
D. , standardized
As in the case of Siebel Systems (now part of Oracle), elements of a global strategy may facilitate the competitive advantage of differentiation by _______. A. , increased freedom of individual business units to adapt to local tastesB. , the creation of a worldwide network to achieve consistent service regardless of locationC. , flexibility in applying Research and Development to meet country-specific needsD. , tailoring products to meet country-specific needs
B. , the creation of a worldwide network to achieve consistent service regardless of location
Which of the following is not a risk associated with a global strategy? A. , A firm with only one manufacturing location must export its product, sometimes at great distance from the operation.B. , The geographic concentration of any activity may also tend to isolate that activity from the targeted markets.C. , Concentrating an activity in a single location makes the rest of the firm dependent on that location.D. , The pressures for local adaptation may elevate the cost structure of the firm.
D. , The pressures for local adaptation may elevate the cost structure of the firm.
