Topic 10 - International Marketing

Question 1

global firm

Answer 1

A firm that, by operating in more than one country, gains R&D,
production, marketing, and financial advantages in its costs and reputation that are not available to purely domestic competitors.

Question 2

U.S. companies looking abroad must start by ____

Answer 2

understanding the international trade

system

Question 3

When selling to another country, a firm may _____

Answer 3

face restrictions on trade between nations.

Question 4

Countries may set ____, limits on the amount of foreign imports that they will
accept in certain product categories.

Answer 4

quotas

Question 5

What is the purpose of a quota?

Answer 5

The purpose of a quota is to conserve on

foreign exchange and protect local industry and employment.

Question 6

A company also may face ____, such as biases against its bids,
restrictive product standards, or excessive host-country regulations or enforcement.

Answer 6

nontariff trade barriers

Question 7

Established in 1947 and

modified in 1994, ____ was designed to promote world trade by reducing tariffs and other international trade barriers

Answer 7

The General Agreement on Tariffs and Trade (GATT)

Question 8

What organization replaced GATT?

Answer 8

World Trade Organization (WTO)

Question 9

Which organization oversees the original GATT provisions?

Answer 9

The World Trade Organization (WTO)

Question 10

The first seven rounds of negotiations
reduced the average worldwide tariffs on manufactured goods from ___ percent to
just ___ percent

Answer 10

45% to 5%

Question 11

What was the impact of the Uruguay round (concluded in 1994)?

Answer 11

The benefits of the Uruguay Round
will be felt for many years, as the accord promoted long-term global trade growth,
reduced the world’s remaining merchandise tariffs by 30 percent, extended the WTO
to cover trade in agriculture and a wide range of services, and toughened the
international protection of copyrights, patents, trademarks, and other intellectual
property.

Question 12

Certain countries have formed _____ or ____.

Answer 12

free trade zones; economic communities

Question 13

Economic community

Answer 13

A group of nations organized to work toward common goals

in the regulation of international trade.

Question 14

The country’s ____ shapes its product and service needs, income levels, and employment levels

Answer 14

industrial structure

Question 15

What are the four types of industrial structures?

Answer 15

subsistence economies, raw material exporting economies, emerging economies (industrializing economies), and industrial economies

Question 16

Subsistence economies

Answer 16

the vast majority of people
engage in simple agriculture. They consume most of their output and barter
the rest for simple goods and services. These economies offer few market
opportunities.

Question 17

Raw material exporting economies.

Answer 17

These economies are rich in one or more

natural resources but poor in other ways. Much of their revenue comes from exporting these resources.

Question 18

Emerging economies (industrializing economies)

Answer 18

fast

growth in manufacturing results in rapid overall economic growth.

Question 19

Industrial economies

Answer 19

Industrial economies are major exporters of manufactured
goods, services, and investment funds. They trade goods among themselves
and also export them to other types of economies for raw materials and
semifinished goods. The varied manufacturing activities of these industrial
nations and their large middle class make them rich markets for all sorts of
goods.

Question 20

The second economic factor is the country’s _____.

Answer 20

income distribution

Question 21

What are the characteristics of different types of nations in regard to income distribution?

Answer 21

Industrialized nations
may have low-, medium-, and high-income households. In contrast, countries with
subsistence economies consist mostly of households with very low family incomes.
Still other countries may have households with either very low or very high incomes

Question 22

Nations differ greatly in their _____environments.

Answer 22

political-legal

Question 23

s. In considering whether to

do business in a given country, a company should consider factors such as ____.

Answer 23

the country’s attitudes toward international buying, government bureaucracy, political stability, and monetary regulations.

Question 24

What should a company consider regarding the cultural environment?

Answer 24

Each country has its own folkways, norms, and taboos. When designing global
marketing strategies, companies must understand how culture affects consumer
reactions in each of its world markets. In turn, they must also understand how their
strategies affect local cultures.