Mission Impossible
Which of the following is not a question asked as part of a VRIO analysis?
(A) Does the resource add value?
(B) Is the resource rare?
(C) Is the resource intangible?
(D) Are other policies and procedures organized to support the exploitation of this resource?
(C) Is the resource intangible? - Chapter 4
If a company sets up a subsidiary abroad to move some of its production overseas, then we talk of:
(A) Captive marketing
(B) Captive offshoring
(C) Captive outsourcing
(D) Captive management
(B) Captive offshoring - Chapter 4
What are you unlikely to see in a ‘feminine’ culture?
(A) Female soldiers
(B) People who care for the weak
(C) Aggressive leadership style
(D) A women prime minister
(C) Aggressive leadership style - Chapter 3
The activity of comparing a company’s resources and capabilities with those of a leading company in the industry is also known as:
(A) Competitor intelligence
(B) Competitor analysis
(C) VRIO analysis
(D) Benchmarking
(D) Benchmarking - Chapter 4
MNEs in which most subsidiaries are headed by a third-country national are said to employ a _________ human resources strategy.
(A) polycentric
(B) tercio-centric
(C) ethnocentric
(D) geocentric
(D) geocentric - Chapter 16
Which of the following is not considered a ‘modern’ trade theory?
(A) Factor endowment theory
(B) Product life cycle theory
(C) National competitive advantage (‘diamond model’)
(D) Strategic trade theory
(A) Factor endowment theory - Chapter 5
Assets specificity refers to investments that are:
(A) Specific to a business relationship
(B) Specific to a business function
(C) Specific to a country
(D) Specific to a product division
(A) Specific to a business relationship - Chapter 6
In a collective society, people belonging to the ‘in-group’ have an advantage because
(A) Out-group members are likely to pay them bribes
(B) Members of other groups will show them respect
(C) Out-group members will show them respect
(D) Other members of the same group will trust them more
(D) Other members of the same group will trust them more - Chapter 3
A company that is producing products on behalf of brand name companies without itself being involved in the product development is also known as:
(A) Original brand manufacturer
(B) Original equipment manufacturer
(C) Original market manufacturer
(D) Original design manufacturer
(B) Original equipment manufacturer - Chapter 4
Subsidiaries that have a leading role within an MNE to develop new products or technology are also known as:
(A) centers of excellence
(B) centers of excel
(C) centers of hubs
(D) centers of hubris
(A) centers of excellence - Chapter 14
Which of the following does not create a ‘liability of outsidership’?
(A) Lack of experience
(B) Being a foreigner
(C) Lack of business networks
(D) Being a native
(D) Being a native - Chapter 1
An ‘acquisition premium’ is:
(A) The difference between the market price of the acquired firm before the acquisition and the price offered by the acquirer.
(B) The increase in the stock price of the acquirer associated with the acquisition.
(C) The pay-off to the directors of the acquired company in return for their cooperation with the acquiring firm.
(D) The difference between stock prices of the acquirer and the acquired company.
(A) The difference between the market price of the acquired firm before the acquisition and the price offered by the acquirer. - Chapter 14
Which of the following indicates high power distance?
(A) Colleagues addressing each other by first name
(B) A comprehensive welfare state
(C) The lack of a first class compartment in trains
(D) None of the above
(D) None of the above - Chapter 3
In international trade theory, the term ‘deadweight loss’ is referring to:
(A) The loss to exporters due to the introduction of tariffs
(B) The loss to importers due to the introduction of tariffs
(C) The loss to consumers due to the introduction of tariffs
(D) The net loss to society due to the introduction of tariffs
(D) The net loss to society due to the introduction of tariffs - Chapter 5
The shift in the relative bargaining power between MNEs and host governments after the foreign investor incurred the sunk costs of their initial investment is known as:
(A) Obsolescing bargain
(B) Resurgent bargain
(C) Empowered negotiation
(D) Resurgent negotiation
(A) Obsolescing bargain - Chapter 6
What is not a characteristic of a market economy?
(A) Buyers and sellers meeting in a market
(B) Prices react to changes in supply and demand
(C) Businesses planning production to supply the market in the future
(D) Business producing according to an economy-wide central plan
(D) Business producing according to an economy-wide central plan - Chapter 2
Free trade areas can have a negative effect on economic welfare because of the
(A) Trade diversion effect
(B) Trade creation effect
(C) Trade reduction effect
(D) Trade exploitation effect
(A) Trade diversion effect - Chapter 9
Against the flow of command in hierarchical organizations, some MNE subsidiaries take proactive and deliberate action to convince their headquarters to increase the scope of their responsibility. Such action is also known as:
(A) subsidiary mandate
(B) worldwide mandate
(C) centre of excellence
(D) subsidiary initiative
(D) subsidiary initiative - Chapter 15
Anti-dumping duties are levied on importers who are engaging in the following practice deemed unfair in international trade:
(A) Failing to source locally
(B) Transfer pricing with the intention to minimize tax payments
(C) Selling below costs with the intention to push competitors from the market
(D) Selling at prices above competitive prices by exploiting monopolistic market positions
(C) Selling below costs with the intention to push competitors from the market - Chapter 5
Assets specificity refers to investments that are:
(A) Specific to a business function
(B) Specific to a business relationship
(C) Specific to a country
(D) Specific to a product division
(B) Specific to a business relationship - Chapter 6
Which of the following statements about business process outsourcing (BPO) is not correct?
(A) BPO is used specifically when outsourcing services to India
(B) A major motivation for BPO is to reduce costs
(C) An important motivation for BPO is to tap into suppliers’ competences
(D) None of the above
(A) BPO is used specifically when outsourcing services to India - Chapter 4
Which statement holds true about state-owned enterprises?
(A) The majority of big multinational enterprises from EU countries are in state ownership
(B) Sovereign wealth funds are the only important form of state-owned enterprises that invest abroad directly
(C) State-owned enterprises from non-EU countries are not allowed to invest in the EU
(D) State-owned enterprises play an important role in FDI from emerging economies
(D) State-owned enterprises play an important role in FDI from emerging economies - Chapter 6
The four freedoms established in the Single European Act are:
(A) Free movement of people, goods, services and capital
(B) Freedom from oppression, servitude, torture and dictatorship
(C) Freedom to vote for representatives in local, regional, national and European parliaments
(D) Freedom from monopolies, oligopolies, unfair practices, and unfair subsidies
(A) Free movement of people, goods, services and capital - Chapter 8
Which statement about the internationalization process model, also known as the Uppsala model is correct?
(A) The model suggests companies have to go through certain specified stages when developing their international business operations.
(B) Commitments to higher degrees of involvement in a foreign market depend on the knowledge acquired by the firm up to that time.
(C) The model was inspired by a study of USA companies expanding first to Canada, and then to countries further afield.
(D) The model mainly applies to mature multinational enterprises.
(B) Commitments to higher degrees of involvement in a foreign market depend on the knowledge acquired by the firm up to that time. - Chapter 11
The factor endowment theory suggests that:
(A) Resources are the foundation of firm’s competitive advantages
(B) National resource endowments are the foundation for comparative advantages in international trade
(C) Many factors contribute to explaining the emergence of comparative advantages
(D) Scarce resources are the foundation for comparative trade advantages
(B) National resource endowments are the foundation for comparative advantages in international trade - Chapter 5