Mid Term Answers

Topics: International trade, World Trade Organization, Free trade Pages: 12 (3153 words) Published: October 29, 2012
MGMT338, International Business, Test #1 sample answers, September 11, 2012  
I. (6 pts) Leslie Igles is being sent to Guatemala as the new manager of a local subsidiary of a U.S. firm. She has a participatory management style and is known for her ability to relate to the workers by occasionally stepping in and working along side of them. Answer the following True and False questions using Hofstede’s Five Dimensions. T   F  1. This management style will not work well with Guatemala’s Power Distance rating. Answer: T

T   F  2. Uncertainty Avoidance levels in Guatemala will make it difficult for Leslie to make changes. Answer: T
T   F  3. The Individualism level in Guatemala is lower than in Sweden. Answer: T
II. (57 pts) Select the best answer.
1.  The major globalization drivers include all of the following except:                 A)    Social
                B)    Competitive
                C)    Technological
                D)    Market
                E)     None. All of the above are major kinds of globalization drivers Answer: A
2.   Foreign Direct Investment
                A)    is the same as Portfolio Investment.                 B)    involves management participation and Portfolio Investment does not.                 C)  has steadily increased since 2000.                 D)    from developing nations substantially increased from 1990 to 2009.                 E)     (B) and (D) above. Answer: E

3. According to the theory of comparative advantage,
                A)    a nation should produce the goods where its disadvantage is the least.                 B)    nations can gain from trade if they are not equally efficient in producing two goods.                 C)    a nation needs to have an absolute advantage in at least one good to gain from trade.                 D)    only (B) and (C)  above.                 E)   only (A) and (B) above Answer: E

4.  The international business manager can choose to: 
A. transfer a management practice intact.
B. transfer and adjust a management practice.
C. not transfer a management practice at all.
D. All of the above
E. only (A) and (B) above. Answer: D

5. From comparisons of income distribution studies over time, it appears that in early stages of development:                 A)    the inequality in income between rich and poor nations increases when purchasing power parity data is used.                 B)    income inequality has narrowed from globalization in most developing nations.                 C)    the income inequality in China has widened.                 D)    All of the above.

                E)   only (B) and (C)  above Answer: E
6. The percentage of the population living in urban areas is:                 A)    increasing in high-income nations, but decreasing in low- and middle-income nations.                 B)    increasing everywhere.                 C)    increasing in low- and middle-income nations, but decreasing in high-income nations.                 D)    becoming younger because older people retire to rural areas.                 E) None of the above

Answer: B
7. An organization with multicountry affiliates, each of which formulates its own business strategy based on perceived market differences is a (A) global company
(B) multidomestic company
(C) international company
(D) only (B) and (C) above
(E) only (A) and (B) above
Answer: D
8. According to Table 2.1, the following country (ies) is (are) in the top five in all four categories: A. China
B. Japan
C. Germany
D. all of the above
E. only (A) and (C) above
Answer: E
9.  According to opponents of the globalization of trade and investment, 
A. globalization has produced uneven results across nations and people.
B. globalization has had harmful effects on labor and labor standards.
C. globalization has contributed to a decline in environmental and health conditions.
D. all of the above. E. None of the above

Answer: D
10.  Slightly more than half of...
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