Management of International Business Multiple Choice Questions
1. Computer programs are protected as :
A. Copyrights
B. Trade marks
C. Patents.
D. none
Answer: A. Copyrights
2. Geographical indication specifies:
A. Place of origin of goods only
B. Special characteristics of product associated with place of origin.
C. Both (a) and (b)
D. none
Answer: C. Both (a) and (b)
3. Strategic alliance cannot be between:
A. Manufacturer and supplier
B. Competitors
C. Non- competitors
D. None of the above
Answer: D. None of the above
4. The mode of entry into international business with least risk to the firm is :
A. Indirect exports
B. Direct exports
C. Management contract
D. Contract Manufacturing
Answer: A. Indirect exports
5. The following is an export intermediary:
A. Export house
B. Trading house
C. A manufacturing exporter
D. Merchant exporter.
Answer: C. A manufacturing exporter
6. A global company can———– its experience to expand its global operations
A. Contract
B. Expand
C. Minimize
D. Leverage
Answer: D. Leverage
7. Governmental regulations can affect the viability & ———– of a company using the internet as a foreign market entry mode.
A. effectiveness
B. association
C. performance
D. None of the above
Answer: A. effectiveness
8. ______ typically offer more flexibility in international markets
A. SMEs
B. LSEs
C. MNEs
D. None of the above
Answer: A. SMEs
9. From the point of view of marketing, an organization that enjoys competitive advantage in an industry has done so by:
A. Focusing on long-term profit.
B. Charging lower prices than competition.
C. Creating superior value for customers.
D. Constantly enlarging its marketing activities.
Answer: C. Creating superior value for customers.
10. Regionalism is:
A. An international management orientation and a protectionist policy created to exclude third world countries from certain forms of international trade.
B. The grouping of countries into regional clusters based on geographic proximity.
C. A protectionist policy created to exclude third world countries from certain forms of international trade.
D. An international management orientation.
Answer: B. The grouping of countries into regional clusters based on geographic proximity.
11. Which one of the following is a pull factor in emigration?
A. Political oppression
B. Job opportunities
C. Food shortages
D. War
Answer: B. Job opportunities
12. Which of the following do NOT facilitate globalization?
A. Improvements in communications
B. Barriers to trade and investment
C. Immigration controls
D. Removal of controls on movement of capital across borders
Answer: B. Barriers to trade and investment
13. Which of the following is not a driver of globalization?
A. The fragmentation of consumer tastes between countries.
B. The competitive process.
C. Multinational companies successfully persuading governments to lower trading barriers.
D. The need to gain economies of scale.
Answer: A. The fragmentation of consumer tastes between countries.
14. Globalization is beneficial for firms because:
A. It protects them against foreign competition.
B. It cushions them from the effects of events in other countries.
C. It opens up new market opportunities.
D. It increases the risk and uncertainty of operating in a globalizing world economy.
Answer: C. It opens up new market opportunities.
15. The internet facilitates globalization by:
A. Making it more difficult to contact potential customers abroad.
B. Cutting the cost for firms of communicating across borders.
C. Making it harder to send money from one country to another.
D. Making it easier for governments to censor the information received by their citizens from abroad.
Answer: B. Cutting the cost for firms of communicating across borders.
16. Globalization can create problems for business because:
A. It can result in more competition.
B. It increases vulnerability to political risk and uncertainty when operating abroad.
C. It means that they can increase prices.
D. All of the options given are correct.
Answer: A. It can result in more competition.
17. How does international law facilitate international trade and investment?
A. It makes it easier to resolve contract disputes for firms involved in international trade and investment.
B. It allows business to choose the most favorable national legal system to institute proceedings.
C. The terms used in international conventions are open to differing interpretations.
D. The Uniform Commercial Code favors big US multinationals.
Answer: A. It makes it easier to resolve contract disputes for firms involved in international trade and investment.
18. Laws relating to The Single Market Program allow EU-based companies to:
A. Move goods and services from any member state to another.
B. Transfer managers to any member state.
C. Invest anywhere in the EU.
D. All of the options given.
Answer: D. All of the options given.
19. Competition Law in the EU means that firms:
A. Are free to set up international cartels.
B. May be refused permission to take over a US competitor.
C. Can not be made to repay government financial assistance.
D. Can cross-subsidise loss-making services from profitable activities.
Answer: B. May be refused permission to take over a US competitor.
20. Within an international context, what are ‘economies of scope’ synonymous with?
A. Reusing a resource from one business/country in additional businesses/countries.
B. Decreased cost per unit of output.
C. Buying components in a bulk.
D. Any of the above.
Answer: A. Reusing a resource from one business/country in additional businesses/countries.
21. Globalization refers to:
A. A more integrated and interdependent world
B. Less foreign trade and investment
C. Global warming
D. Lower incomes worldwide
Answer: A. A more integrated and interdependent world
22. Which of the following could be defined as a multinational company?
A. A firm that owns shares in a foreign company but does not participate in the company’s decision making.
B. A UK based internet package holiday firm specializing in selling tours to Turkey to German customers.
C. A firm owning a chain of supermarket outlets outside its country of origin.
D. A finance company transferring its HQ and all its activities from the UK to the US.
Answer: C. A firm owning a chain of supermarket outlets outside its country of origin.
23. Why might MNCs in the past have focused their marketing activities on the triad?
A. That is where the most lucrative markets were located.
B. Income per head in developing countries was relatively low.
C. Transport and communication links were improving outside the tri
Answer: A. That is where the most lucrative markets were located.
24. Which of the following statements on civil law systems would be seen as an advantage by business?
A. Civil law systems operate in very few countries.
B. Relevant areas of law are much easier to find than in common law systems.
C. Relevant areas of law are more difficult to find than in common law systems.
D. Lawyers act as oral advocates for their clients.
Answer: B. Relevant areas of law are much easier to find than in common law systems.
25. The law relating to E-Commerce fits which of the following descriptions:
A. It comprises a single set of laws.
B. The law lacks clarity.
C. There is no problem applying contract law to the internet.
D. The law makes it easy to deal with foreign computer hackers.
Answer: B. The law lacks clarity.
26. The existence of different currencies is beneficial to private financial institutions because:
A. Each country has its own currency.
B. The exchange rate of each currency is fixed by the International Monetary Fund.
C. A collapse in the exchange rate of a currency can cause economic disruption.
D. Profits can be made from arbitrage.
Answer: D. Profits can be made from arbitrage.
27. The International Monetary Fund is important because:
A. It has sufficient financial resources to deal with a major global financial crisis.
B. It has sufficient financial resources to help individual countries facing balance of payments problems.
C. Emerging economies can exercise significant influence on it.
D. It fixes exchange rates.
Answer: B. It has sufficient financial resources to help individual countries facing balance of payments problems.
28. What functions do financial institutions traditionally perform?
A. They immobilise savings.
B. They concentrate risk.
C. They spread risk.
D. They offer only short-term finance.
Answer: B. They concentrate risk.
29. Ethnocentric views concentrate on their
A. home country
B. host country
C. world orientation
D. Racial orientation
Answer: A. home country
30. Specific cultural dimensions that does not have a significant impact on cross national business interactions is
A. Hofstede’s five cultural dimensions
B. Monochromatic vs polychromatic tune
C. Communication
D. Geography
Answer: D. Geography
31. Which of the following are characteristic of the period when financial bubbles burst?
A. Excessive optimism about future asset prices.
B. Excessive pessimism about future asset prices.
C. Rising house prices.
D. Rising share prices.
Answer: B. Excessive pessimism about future asset prices.
32. The balance of payments includes which of the following?
A. a country’s balance of trade
B. foreign investments
C. foreign aid
D. all of the above
Answer: D. all of the above
33. Which one of the following is a pull factor in emigration?
A. Political oppression
B. Job opportunities
C. Food shortages
D. War
Answer: D. War
34. Which of the following do NOT facilitate globalization?
A. Improvements in communications
B. Barriers to trade and investment
C. Immigration controls
D. Removal of controls on movement of capital across borders
Answer: C. Immigration controls
35. Which of the following constitutes Foreign Direct Investment?
A. A speculator trying to make a profit by buying company shares on a foreign stock exchange.
B. A UK energy company buying territory abroad where it expects to find oil reserves.
C. A tourist purchasing foreign currency to spend on a holiday abro
Answer: B. A UK energy company buying territory abroad where it expects to find oil reserves.
36. Which of the following is a driver of globalization?
A. Trade barriers and controls on inflows of foreign direct investment.
B. Weak competition.
C. Technological advance.
D. Economies of scale are being exploited to the maximum.
Answer: B. Weak competition.
37. Globalization is beneficial for firms because:
A. It protects them against foreign competition.
B. It cushions them from the effects of events in other countries.
C. It opens up new market opportunities.
D. It increases the risk and uncertainty of operating in a globalizing world economy.
Answer: A. It protects them against foreign competition.
38. The internet facilitates globalization by:
A. Making it more difficult to contact potential customers abroad.
B. Cutting the cost for firms of communicating across borders.
C. Making it harder to send money from one country to another.
D. Making it easier for governments to censor the information received by their citizens from abroad.
Answer: D. Making it easier for governments to censor the information received by their citizens from abroad.
39. Globalization can create problems for business because:
A. It can result in more competition.
B. It reduced vulnerability to political risk and uncertainty when operating abroad.
C. It means that they can increase prices.
D. All of the options given are correct.
Answer: D. All of the options given are correct.
40. In a global market place
A. the entire world is a market place
B. national borders are irrelevant
C. the potential for organizations to grow expands dramatically
D. All of the above
Answer: D. All of the above
41. In a global market place Managers must
A. deals with economic, political and cultural differences
B. expect competitors to suddenly appear at any time from any place
C. not to take specific differences of local environment into consideration
D. A and B
Answer: D. A and B
42. Trade Related Investment Measures (TRIMS) doesn’t apply for
A. Measures that affect trade in goods.
B. Measures that lead to restrictions in quantities.
C. Discouraging measures that limit a company’s imports.
D. Discouraging measures that limit a company’s exports.
Answer: B. Measures that lead to restrictions in quantities.
43. . General Agreement on Trade in Services will not be applicable to
A. Services supplied from one country to another – cross border supply
B. Transaction of goods across the border – Export Import
C. Individuals traveling from own country to supply services in another – presence of natural persons.
D. Consumers/firms making use of a service in another country – consumption abroad.
Answer: B. Transaction of goods across the border – Export Import
44. As a part of WTO guidelines, Agreement on Agriculture (AOA) doesn’t consider
A. Direct payments to farmers are permitted.
B. Indirect assistance and support to farmers including R & D support by govt. are not permitted.
C. Domestic policies which directly effect on production and trade have to be cut back.
D. Least developed countries do not need to make any cuts.
Answer: B. Indirect assistance and support to farmers including R & D support by govt. are not permitted.
45. Quantitative restrictions refer to limit set by countries to curb
A. Measures that affect trade in goods.
B. Measures that lead to restrictions in quantities.
C. Discouraging measures that limit a company’s imports.
D. Discouraging measures that limit a company’s exports.
Answer: C. Discouraging measures that limit a company’s imports.
46. A Most Favored nation status doesn’t necessarily refers to
A. Same and equal economic treatment
B. Non-discriminatory treatment
C. Same tariff rates applicable
D. Uniform civil code
Answer: D. Uniform civil code
47. The world trade organization was formed in the year _________ with GATT as it basis.
A. 1993
B. 1994
C. 1995
D. 1996
Answer: C. 1995
48. NAFTA is an example of
A. Common Market
B. Customers Union
C. Economic Community
D. Free Trade Area
Answer: D. Free Trade Area
49. Which one is not an international organization
A. SAARC
B. ASEM
C. ASEAN
D. CBDT
Answer: D. CBDT
50. Which of the following is not an International Financial Institution
A. ICICI
B. IMF
C. IDA
D. World Bank
Answer: A. ICICI
51. What one of the following is not the advantage of MNCs to the host country
A. Increase in social activities
B. increase in economic activities
C. Utilisation of natural resource
D. R&D efforts enhanced.
Answer: A. Increase in social activities
52. In terms of the PESTLE analysis, the liberalizing of international trade and tariffregimes could go in which section or sections?
A. Political
B. Legal
C. Political and economic and legal
D. Political and environmental
Answer: D. Political and environmental
53. An ‘industry recipe’ can be defined as:
A. An accepted pattern of operating and competing
B. A tactic for anticipating a competitor’s next move
C. The hidden competences that are difficult to imitate
D. A strategic group
Answer: C. The hidden competences that are difficult to imitate
54. Typically, profits are highest in which stage of the industry life-cycle?
A. Introduction
B. Growth
C. Maturity
D. Decline
Answer: B. Growth
55. The corporate culture of a firm is more effectively carried to the managers who are
A. Host country nationals
B. Home country nationals
C. Third country nationals
D. none
Answer: B. Home country nationals
56. Posting of home country nationals for all key management positions throughout the globe is supported by:
A. Geocentric staffing model.
B. Polycentric staffing model.
C. Ethnocentric staffing model.
D. none
Answer: C. Ethnocentric staffing model.
57. Which of the following is NOT a business opportunity generated by globalization?
A. Access to low cost labour.
B. Cheap International transport.
C. Currency crises.
D. Less stringent regulation of the business environment.
Answer: C. Currency crises.
Unit 1
58. The interpersonal norms of a country may necessitate a company’s alteration of __?
A. Child Labor
B. Operations
C. Accounting
D. None of the above
Answer: B. Operations
59. Which of the following terms are not synonymous with the others?
A. MNE
B. MNC
C. MNM
D. TNC
Answer: C. MNM
60. Foreign sources may give companies?
A. Higher costs
B. New and/or better products
C. Conflicting operating knowledge
D. Legal problems
Answer: B. New and/or better products
61. A major operating objective that may induce companies to engage in international business is_____?
A. To expand sales
B. To maximize risk
C. To acquire competitors
D. None of the above
Answer: A. To expand sales
62. Critics of globalization claim _______?
A. Countries lose sovereignty
B. The resultant growth hurts the environment
C. Some people lose in both aspects
D. All of the above
Answer: D. All of the above
63. All of the following are objectives of international business operations except for:
A. sales expansion
B. resource acquisition
C. locally expanding
D. risk minimization
Answer: C. locally expanding
64. Globalization consists of the following processes except:
A. political process
B. environmental process
C. social process
D. economic process
Answer: B. environmental process
65. Which of the following is a criticism of globalization?
A. going into someone’s country uninvited
B. different climates in other countries get in the way
C. terrorist opportunities
D. threat to national sovereignty
Answer: D. threat to national sovereignty
66. To minimize your risk you can:
A. diversify suppliers across countries
B. take advantage of business cycle differences amongst countries
C. a & b
D. none of the above
Answer: C. a & b
67. Which of the following does not support globalization?
A. Improvements in communications
B. Barriers to trade and investment
C. Immigration controls
D. Removal of controls on movement of capital across borders
Answer: C. Immigration controls
68. The gains from two nations depend on
A. Domestic barter rates
B. Different in the domestic barter rates of the two countries
C. Terms of trade
D. Degree of absolute advantage.
Answer: C. Terms of trade
Unit 3
69. Which of the following statements is not true when describing a successful strategy?
A. It provides some property that is unique or distinctive
B. It provides the means for renewing competitive advantage
C. It addresses changes in the external environment
D. It guarantees long term survival
Answer: B. It provides the means for renewing competitive advantage
70. In the context of strategic management resources can be defined as:
A. The knowledge and skills within the organization
B. Something that an organization owns or controls that cannot be copied
C. Something that an organization owns, controls or has access to on a semipermanent basis
D. The physical assets of the organization
Answer: D. The physical assets of the organization
71. In the context of strategic management, stakeholders can be defined as:
A. An individual or group with a financial stake in the organization
B. An external individual or group that is able to impose constraints on the organization
C. Internal groups or individuals that are able to influence strategic direction of the organization
D. An individual or group with an interest in the organization’s activities and who seeks to influence them
Answer: C. Internal groups or individuals that are able to influence strategic direction of the organization
72. In the case where an organization acquires its supplier, this is an example of:
A. Horizontal integration
B. Forwards vertical integration
C. Backwards vertical integration
D. Downstream vertical integration
Answer: D. Downstream vertical integration
73. Knowledge which is difficult to define and codify is known as:
A. Explicit
B. Tangible
C. Tacit
D. Random
Answer: A. Explicit
74. Competitive advantage based on the creation of opportunities using internal resources is characterized by which approach/view?
A. The positioning approach
B. The outside-in approach
C. The resource-based view
D. The knowledge-management approach
Answer: C. The resource-based view
Unit 2
75. When a firm seeks the benefits of global integration and local adaptation, it is bestdescribed as which type of strategy?
A. Transnational
B. Global
C. Multi-national
D. Global-local
Answer: C. Multi-national
76. ‘Reputation’ in the context of an organization’s resources can provide competitive advantage because:
A. It is difficult to copy
B. It is based on word-of-mouth
C. It is a threshold resource
D. It is explicit
Answer: A. It is difficult to copy
77. A strategic manager that seeks to reach acceptable profit targets as opposed to making as much profit as possible is making decisions of which type?
A. Satisfactory
B. Satisficing
C. Irrational
D. Optimal
Answer: A. Satisfactory
78. ‘Logical incrementalism’ can be described as:
A. Careful design and planning
B. Emergent
C. Cautious resource allocation
D. Top management rational analysis
Answer: D. Top management rational analysis
79. An organization in which strategy development is characterized by internal political negotiation and self-interest is operating in which strategy-making mode?
A. The transactive mode
B. The muddling through mode
C. The command mode
D. The emotional mode
Answer: C. The command mode
80. McDonalds is deciding whether to expand into manufacturing kitchen equipment in China. At what level is this decision likely to be made?
A. Business
B. Corporate
C. Functional
D. International
Answer: A. Business
81. Diversification into many unrelated areas is an example of:
A. Risk management
B. Good management
C. Uncertainty reduction
D. Sustainability
Answer: C. Uncertainty reduction
82. Corporate governance is concerned with:
A. Executive remuneration, disclosure of information, auditing and accounting procedures, and organizations’ management structures
B. Elections to the board of directors
C. Relationships with national governments
D. Corporate-level strategy
Answer: C. Relationships with national governments
83. The principal-agent problem is concerned with:
A. Procurement
B. Appropriation of shareholders’ investment by a firm’s managers
C. How to control a firm’s distributors and dealers
D. Corporate social responsibility
Answer: D. Corporate social responsibility
84. The Six Forces framework is based on the principle of:
A. Resource-based view
B. Conduct – structure – performance
C. Econometrics
D. Structure – conduct – performance
Answer: A. Resource-based view
85. In the Six Forces, the ‘threat of new entrants’ relates to:
A. Barriers to entry
B. Substitutes
C. Switching costs
D. Buyer power
Answer: D. Buyer power
86. An industry characterized by irregular patterns of stability, rapid technological change, high uncertainty and global competition can be described as:
A. Hypercompetitive
B. Hyperactive
C. Atypical
D. Co-optive
Answer: D. Co-optive
87. In the context of environmental analysis, ‘munificence’ means:
A. The extent to which resources are freely available to support firms in an industry and enable them to grow
B. The extent to which it is diverse
C. The extent to which it is stable or turbulent
D. The extent to which the industry follows the conventional life-cycle stages
Answer: C. The extent to which it is stable or turbulent
88. A ‘market driven’ firm will typically:
A. Develop new products and then find someone to sell them to
B. Define the target market and produce products that will satisfy those customers’ needs
C. Operate in a product-oriented fashion
D. Suffer from market-myopia
Answer: B. Define the target market and produce products that will satisfy those customers’ needs
89. Segmentation is a way of:
A. Subdividing markets
B. Subdividing industries
C. Differentiating products
D. Subdividing organizations into departments
Answer: A. Subdividing markets
90. A B2C market is:
A. Business to commercial
B. Business to consumer
C. Business to contract
D. Business to corporate
Answer: D. Business to corporate
91. Segmentation is a compromise between two ideals: mass marketing and:
A. Customization
B. Uniformity
C. Innovation
D. Convergence of tastes
Answer: B. Uniformity
92. Porter’s generic strategies are:
A. Low price, differentiation, focus
B. Cost leadership, differentiation, cost focus, focus differentiation
C. Price leadership, differentiation, focus
D. Low cost, differentiation, focus differentiation
Answer: B. Cost leadership, differentiation, cost focus, focus differentiation
Unit 2
93. A strategic decision can be distinguished from other types of decisions by three factors, theseare magnitude, time-scale and:
A. Commitment
B. Riskiness
C. Impact
D. Longevity
Answer: B. Riskiness
94. ‘Influence’ is defined as the ability to ____________ someone to something they wouldnot otherwise have done.
A. Intimidate
B. Force
C. Order
D. Persuade
Answer: A. Intimidate
95. The authors believe there are three tests that can be applied to judge whether astrategy is ‘good’. These are:
A. Fit, distinctiveness, sustainability
B. Fit, internal resources, external environment
C. Distinctiveness, internal resources, fit
D. Sustainability, distinctiveness, external environment
Answer: B. Fit, internal resources, external environment
96. According to Porter, dealing with the paradox of premature commitment versus notenough commitment involves some kind of:
A. Trade-off
B. Lock-in
C. Lock-out
D. Diversification
Answer: C. Lock-out
97. Which of the following industries is least likely to follow the conventional life-cyclemodel?
A. Software development
B. Coal mining
C. Insurance broking
D. Hairdressing
Answer: A. Software development
98. Brandenburger and Nalebuff added a sixth force to Porter’s Five Forces. It is knownas:
A. The threat of substitutes
B. The power of complementors
C. Seller power
D. Government regulation
Answer: A. The threat of substitutes
99. A situation in which the joint moves of two firms can determine how much money eachfirm can make or lose can be explained using the story of:
A. The Trojan Horse
B. The Icarus Paradox
C. The Prisoner’s Dilemma
D. The Icarus Dilemma
Answer: D. The Icarus Dilemma
100. According to Porter, if an organization does not follow either a cost leadership strategy or adifferentiation strategy they are:
A. Hybrid
B. Stuck in the middle
C. Typical
D. No frills
Answer: C. Typical
101. Subsidiaries consider regional environment for policy / Strategy formulation is known as
A. Polycentric Approach
B. Regiocentric Approach
C. Ethnocentric Approach
D. Geocentric Approach
Answer: B. Regiocentric Approach
102. According to this theory the holdings of a country’s treasure primarily in the form ofgold constituted its wealth.
A. Gold Theory
B. Ricardo Theory
C. Mercantilism
D. Hecksher Theory
Answer: C. Mercantilism
103. Which is not an Indian Multinational Company?
A. Unilever
B. Asian Paints
C. Piramal
D. Wipro
Answer: A. Unilever
104. Globalization refers to:
A. Lower incomes worldwide
B. Less foreign trade and investment
C. Global warming and their effects
D. A more integrated and interdependent world
Answer: D. A more integrated and interdependent world
105. All the following statements are correct except:
A. Case studies examine specific mergers and look for firm specific examples of merger benefits.
B. Stock market studies tend to suggest that most of the stock market gains from merger accrue to shareholders of target firms.
C. Financial and accounting studies typically conclude that mergers benefit shareholders
D. Case studies, the stock market and financial accounting based studies typically conclude that mergers are not always a good idea.
Answer: C. Financial and accounting studies typically conclude that mergers benefit shareholders
106. All of the following examples are hypothetical cases of horizontal growth except:
A. Coca Cola and Pepsi Cola merge
B. Manchester United and Manchester City merge
C. British Airways and Easyjet merge
D. Ford and Michelin merge
Answer: D. Ford and Michelin merge
107. In 90’s the global management perception was based on
A. Standardization v/s adaptation
B. Globalization v/s localization
C. Global integration v/s Local Responsiveness
D. Local responsiveness
Answer: C. Global integration v/s Local Responsiveness
108. Which of the following is an advantage of turnkey projects?
A. Can earn a return on knowledge asset
B. Will not create a competitor
C. Tight control of operations
D. All the above
Answer: A. Can earn a return on knowledge asset
109. CISF pricing includes the following
A. Commission is paid to the agent involved in the transaction
B. Cost of the goods exported
C. Freight & Insurance charges for the goods exported
D. All of the above
Answer: D. All of the above
110. Vertical mergers are those in which the participants are
A. In the same industry.
B. In different industries
C. In different phases of the value chain
D. None of the above.
Answer: C. In different phases of the value chain
111. Which of the following are commonly cited reasons for M&As?
A. Synergy
B. Market power
C. Strategic realignment
D. All of the above
Answer: D. All of the above
112. A merger is a combination of businesses in which
A. Two businesses combine to form a new business.
B. The participants are necessarily comparable in size, competitive position, Profitability, and market capitalization.
C. One of the two firms becomes a wholly owned subsidiary of the other firm.
D. None of the above.
Answer: D. None of the above.
113. All of the following are common motives for a merger or acquisition except for
A. Operating synergy.
B. Financial synergy.
C. Raising the cost of capital.
D. Buying undervalued assets.
Answer: C. Raising the cost of capital.
114. Buyers can exercise high bargaining power over their suppliers if
A. The volume they buy accounts for a large percentage of their suppliers sales.
B. There are few buyers in the market.
C. They have many suppliers to choose from.
D. There is a high concentration of suppliers.
Answer: A. The volume they buy accounts for a large percentage of their suppliers sales.
115. The generic competitive strategies are
A. Overall Cost Leadership
B. Cost Focus
C. Differentiation and Focused Differentiation
D. All the above
Answer: D. All the above
116. Synergy’ can best be explained by which of the sums below?
A. 2+2=5.
B. 2+2=4.
C. 2-2=1.
D. 2-2=0.
Answer: A. 2+2=5.
Unit 2
117. A likely consequence of rationalization is:
A. Lower number of employees
B. Lower revenues
C. Higher costs
D. Price decrease
Answer: C. Higher costs
118. A likely consequence of merger and acquisition is:
A. Lower revenues
B. Price increase
C. Higher costs
D. Price decrease
Answer: B. Price increase
119. The agreement signed by Ranbaxy Laboratory and Bayer AG of Germany in the year 1999 is an example of
A. Subsidiary
B. Joint venture
C. Strategic International Alliance
D. License agreement
Answer: C. Strategic International Alliance
120. When the transaction is of high value, complex In nature and more technical __________ method of export sales contract is used.
A. Performa invoice
B. Purchase order
C. Sales contact
D. None of the above
Answer: C. Sales contact
121. What are core competences?
A. Resources which critically underpin competitive advantage and that others cannot obtain.
B. Activities and processes needed to meet customers’ minimum requirements and therefore to continue to exist.
C. Key skills required for success in a particular business.
D. Activities that underpin competitive advantage and are difficult for competitors to imitate or obtain.
Answer: D. Activities that underpin competitive advantage and are difficult for competitors to imitate or obtain.
122. What do you mean by the term “holding company” is:
A. organization with a balanced portfolio of individual businesses
B. decentralized organization with a small head office that organizes finance for the subsidiaries
C. centralized organization with a small head office that helps subsidiaries develop and finance their strategies
D. decentralized organization with a large head office that offers a broad range of advice and services to subsidiaries
Answer: B. decentralized organization with a small head office that organizes finance for the subsidiaries
123. A firm with a functional director for 6 areas with an area director for 3 functions. There, staff at each area will be reporting to 2 bosses. This firm has which type of structure?
A. Project structure
B. Matrix structure
C. Divisionalized structure
D. Front-back structure
Answer: B. Matrix structure
124. Organization structure that is a functional or divisional structure but at the same time also includes project teams for dealing with specific issues is called:
A. An M-form structure
B. A front-back structure
C. A networked structure
D. A hybrid structure
Answer: D. A hybrid structure
125. Organization whose structure is divided into two main parts – one dealing with product groups and one dealing with customer segments is called:
A. A front-back structure
B. A product-customer structure
C. A back to back structure
D. A matrix structure
Answer: A. A front-back structure
126. Choose the right sentence
A. Organization’s structure would be expected to evolve as it grew larger and more diverse
B. Every organization starts out with a simple structure, then moves to a functional structure before becoming divisionalized
C. Network structures are superior to functional ones
D. Organizational performance will suffer if the structure is not stable
Answer: A. Organization’s structure would be expected to evolve as it grew larger and more diverse
127. Format of reporting and for decision making relationships can be defined as the organizational:
A. Span of control
B. Architecture
C. Hierarchy
D. Chain of command
Answer: C. Hierarchy
128. Main component of Organization’s architecture are structural hierarchy, values and belief systems, contracts and relationships and (two more):
A. Control systems and ways of working
B. Information infrastructure and power structures
C. Control systems and power structures
D. Control systems and information infrastructure
Answer: D. Control systems and information infrastructure
129. ‘Vertical architecture’ is the one which has:
A. Has a tall hierarchy
B. Has many layers of management
C. Extends beyond the boundaries of legal ownership
D. Is very bureaucratic
Answer: C. Extends beyond the boundaries of legal ownership
130. Five dimensions are used to judge Organizational structures and systems (ABCDE) to assess whether they are achieving an appropriate balance. These five dimensions are Autonomy, Bureaucracy, Cultural Control, Decentralization and:
A. Equal Opportunities
B. Economic Incentives
C. Equality and Diversity
D. Evidence of Learning
Answer: B. Economic Incentives
131. Those Organizations that are relatively good at developing some relevant capabilities to respond to a changing context are known as:
A. Knowing organizations
B. Stretch organizations
C. Learning organizations
D. Absorptive organizations
Answer: C. Learning organizations
Unit 3
132. When a firm seeks the benefits of global integration and local adaptation, it is best described as which type of strategy?
A. Transnational
B. Global
C. Multi-national
D. Global-local
Answer: C. Multi-national
133. A strategic decision can be distinguished from other types of decisions by three factors,these are magnitude, time-scale and:
A. Commitment
B. Riskiness
C. Impact
D. Longevity
Answer: B. Riskiness
134. ‘Influence’ is defined as the ability to ____________ someone to something they would not otherwise have done.
A. Intimidate
B. Force
C. Order
D. Persuade
Answer: A. Intimidate
135. The authors believe there are three tests that can be applied to judge whether a strategy is ‘good’. These are:
A. Fit, distinctiveness, sustainability
B. Fit, internal resources, external environment
C. Distinctiveness, internal resources, fit
D. Sustainability, distinctiveness, external environment
Answer: B. Fit, internal resources, external environment
136. According to Porter, dealing with the paradox of premature commitment versus not enough commitment involves some kind of:
A. Trade-off
B. Lock-in
C. Lock-out
D. Diversification
Answer: C. Lock-out
137. In terms of the PESTLE analysis, the liberalizing of international trade and tariff regimes could go in which section or sections?
A. Political
B. Legal
C. Political and economic and legal
D. Political and environmental
Answer: D. Political and environmental
138. Which of the following industries is least likely to follow the conventional life-cycle model?
A. Software development
B. Coal mining
C. Insurance broking
D. Hairdressing
Answer: A. Software development
139. Brandenburger and Nalebuff added a sixth force to Porter’s Five Forces. It is known as:
A. The threat of substitutes
B. The power of complementors
C. Seller power
D. Government regulation
Answer: A. The threat of substitutes
140. A situation in which the joint moves of two firms can determine how much money each firm can make or lose can be explained using the story of:
A. The Trojan Horse
B. The Icarus Paradox
C. The Prisoner’s Dilemma
D. The Icarus Dilemma
Answer: D. The Icarus Dilemma
141. According to Porter, if an organization does not follow either a cost leadership strategy or a differentiation strategy they are:
A. Hybrid
B. Stuck in the middle
C. Typical
D. No frills
Answer: C. Typical
142. Which is the right sequence of a stages of Internationalization
A. Domestic, Transnational, Global, International, Multinational
B. Domestic, International, Multinational, Global, Transnational
C. Domestic, Multinatinal, International, Transnational, Global
D. Domestic, Internatinal, Transnational, Multinational, Global
Answer: B. Domestic, International, Multinational, Global, Transnational
143. Which of the following is not a force in the Porter Five Forces model?
A. Buyers
B. Suppliers
C. Complementary products
D. Industry rivalry
Answer: C. Complementary products
144. A likely consequence of rationalization is:
A. Lower number of employees
B. Lower revenues
C. Higher costs
D. Price decrease
Answer: B. Lower revenues
145. The agreement signed by Ranbaxy Laboratory and Bayer AG of Germany in the year 1999 is an example of
A. Subsidiary
B. Joint venture
C. Strategic International Alliance
D. License agreement
Answer: C. Strategic International Alliance
146. When the transaction is of high value, complex In nature and more technical __________ method of export sales contract is used.
A. Performa invoice
B. Purchase order
C. Sales contact
D. None of the above
Answer: C. Sales contact
147. What are core competences?
A. Resources which critically underpin competitive advantage and that others cannot obtain.
B. Activities and processes needed to meet customers’ minimum requirements and therefore to continue to exist.
C. Key skills required for success in a particular business.
D. Activities that underpin competitive advantage and are difficult for competitors to imitate or obtain.
Answer: D. Activities that underpin competitive advantage and are difficult for competitors to imitate or obtain.
148. Specific cultural dimensions that does not have a significant impact on cross-national business interactions is
A. Hofstede’s five cultural dimensions
B. Monochromatic vs polychromatic tune
C. Communication
D. Geography
Answer: D. Geography
149. Professional culture refers to
A. Shared belief of top managers about how they should manage themselves and their employees
B. Shared code of ethics and other commonalities shared by members of a given group
C. Both (a) and (c)
D. None of the above
Answer: B. Shared code of ethics and other commonalities shared by members of a given group
150. An attribute that doesn’t contribute to Porters Diamond model is
A. Government
B. Organized Trade union
C. Factor Conditions
D. Demand Conditions
Answer: B. Organized Trade union
151. Theory of Mercantilism propagates
A. Encourage exports and imports
B. Encourage exports and discourage imports
C. Discourage exports and imports
D. Discourage exports and encourage imports
Answer: B. Encourage exports and discourage imports
152. Identify a factor that doesn’t play an important role in attracting FDI
A. Laws, rule sand regulations
B. Administrative procedures and efficiency
C. Infrastructure related factors
D. Language
Answer: D. Language
153. General electric follows ___________ as its international operational strategy
A. GLOBAL
B. TRANSNATIONAL
C. INTERNATIONAL
D. MULTI-DOMESTIC
Answer: B. TRANSNATIONAL
154. Which term refers to the phenomenon in which the world’s population shares commonly recognized cultural symbols?
A. global village
B. monopolistic market
C. global city
D. multicultureal village
Answer: A. global village
155. According to the concept of the value chain, a firm is profitable if:
A. the value it commands equals the costs involved in creating the product.
B. it operates in global industries
C. the value it commands exceeds the costs involved in creating the product
D. the value it commands is lower than the costs involved in creating the product
Answer: C. the value it commands exceeds the costs involved in creating the product
156. In which industries is global competition more common?
A. where the value chain functions are carried out at head office
B. where upstream and support activities are crucial to competitive advantage
C. where downstream activities or other-tied activities are vital to competitive advantage
D. in none of the above situations
Answer: B. where upstream and support activities are crucial to competitive advantage
157. A global market leader is an organization which:
A. has the monopoly over several foreign markets.
B. has more than 50% global market share.
C. is ahead of the competition in terms of global innovation.
D. is recognized as being ahead of the rest in terms of market share.
Answer: D. is recognized as being ahead of the rest in terms of market share.
Unit 4
158. The international division is established:
A. In the corporate headquarters of the firm
B. At the regional headquarter.
C. Under marketing department.
D. Mostly at the corporate headquarters of the firm, but can be at a foreign centre also.
Answer: D. Mostly at the corporate headquarters of the firm, but can be at a foreign centre also.
159. Global area structure is suitable for firms:
A. Narrow product line.
B. Wider product line
C. Narrow product line not transferable across regions.
D. none
Answer: D. none
160. Duplication of staff groups results in:
A. International division structure.
B. Global product division structure.
C. Global matrix structure.
D. none
Answer: B. Global product division structure.
161. Most complex of international organization structures is :
A. Global matrix structure.
B. Global functional structure
C. Transnational network structure.
D. none
Answer: C. Transnational network structure.
162. Posting of home country nationals for all key management positions throughout the globe issupported by:
A. Geocentric staffing model.
B. Polycentric staffing model.
C. Ethnocentric staffing model.
D. none
Answer: C. Ethnocentric staffing model.
163. The following is not considered as an acceptable motivation for foreign assignments:
A. Desire for adventure.
B. Desire to increase chances of promotion.
C. Escape from boredom of present assignment.
D. none
Answer: C. Escape from boredom of present assignment.
164. It was recognized in the 1990s that physical assets are not the only thing that needs to be included in the valuation of a firm. In Europe, firms also included a supplement detailing the:
A. Goodwill
B. Intellectual capital
C. Brand reputation
D. Knowledge
Answer: B. Intellectual capital
165. A graph showing a rise in demand over a number of years can be described as:
A. Raw data
B. Information
C. Narrative
D. Knowledge
Answer: B. Information
166. Something that you learn to do by practicing rather than from reading a manual is knownas:
A. Explicit knowledge
B. Codified knowledge
C. Embodied knowledge
D. Symbolic knowledge
Answer: C. Embodied knowledge
167. Knowledge that is known to a specific set of people who understand what particular references mean, whereas people outside of that group don’t know what they mean is known as:
A. Clique knowledge
B. Elite knowledge
C. Cultural knowledge
D. Symbolic knowledge
Answer: D. Symbolic knowledge
168. Organizations that are good at developing relevant capabilities to respond to a changing context are known as:
A. Knowing organizations
B. Stretch organizations
C. Learning organizations
D. Absorptive organizations
Answer: C. Learning organizations
169. An organization adjusts its pricing in response to falling customer demand. This is an exampleof which type of learning?
A. Single-loop learning
B. Double-loop learning
C. Surface learning
D. Deep learning
Answer: A. Single-loop learning
170. Which of the following attributes is NOT seen as being necessary for an organization to become a ‘learning organization’?
A. Cultural diversity
B. Top management commitment
C. Openness to new ideas
D. Willingness to experiment and risk making mistakes
Answer: A. Cultural diversity
171. One of the traps into which organizations can fall with respect to organizational learning is that they misread the reasons for success or failure. This trap is known as:
A. Causal ambiguity
B. Superstitious learning
C. Surface learning
D. Mistaken attribution learning
Answer: B. Superstitious learning
172. Knowledge management is concerned with the emergence, storage and_________ ofknowledge.
A. Trade
B. Transfer
C. Translation
D. Transcription
Answer: B. Transfer
173. One of the main problems with explicit knowledge is that:
A. It is difficult to transfer
B. It is easier to obtain it
C. It is not fluid
D. It inhibits further learning
Answer: B. It is easier to obtain it
174. A holding company is:
A. An organization with a balanced portfolio of individual businesses
B. A decentralized organization with a small head office that organizes finance for the subsidiaries
C. A centralized organization with a small head office that helps subsidiaries develop and finance their strategies
D. A decentralized organization with a large head office that offers a broad range of advice and services to subsidiaries
Answer: B. A decentralized organization with a small head office that organizes finance for the subsidiaries
175. A firm has a functional director for six areas and an area director for three functions. There, taff at each area/function will be reporting to 2 bosses. This firm has which type of structure?
A. Project structure
B. Matrix structure
C. Divisionalized structure
D. Front-back structure
Answer: B. Matrix structure
176. An organization structure that is in the main a functional or divisional structure but alsoincludes project teams to deal with specific issues is called:
A. An M-form structure
B. A front-back structure
C. A networked structure
D. A hybrid structure
Answer: D. A hybrid structure
177. An organization that divides its structure into two main parts – one dealing with product groups and one dealing with customer segments is called:
A. A front-back structure
B. A product-customer structure
C. A back to back structure
D. A matrix structure
Answer: A. A front-back structure
178. The essential question that a corporate parent needs to ask is:
A. Does it add value to its individual businesses
B. How does it achieve a balanced portfolio
C. How does it achieve synergies across business units
D. How related should its business units be
Answer: A. Does it add value to its individual businesses
179. A corporate parent can offer an individual business a number of ‘propositions’. These are buildpropositions, stretch propositions, link propositions, select propositions and:
A. Lend propositions
B. Locate propositions
C. Leverage propositions
D. Leap propositions
Answer: C. Leverage propositions
180. The parenting style ‘financial control’ will tend to be most suitable in which type of portfolio?
A. A broad portfolio of fast growing businesses
B. Stable businesses with low investment needs
C. A narrow portfolio of closely related businesses
D. A rapidly changing business environment
Answer: B. Stable businesses with low investment needs
181. Which type of corporate parenting style has the closest relationship with its individual businesses?
A. Co-evolution
B. Corporate flexibility
C. Strategic Control
D. Strategic planning
Answer: D. Strategic planning
182. What is the main reason why organizations enter alliances?
A. To find out how the other organization works, and copy it
B. To obtain synergies between other organizations’ resources and their own
C. To increase their capacity to learn
D. Because they have not enough cash to acquire the other organization
Answer: B. To obtain synergies between other organizations’ resources and their own
183. Which of the following is NOT an important element to look for when selecting an alliance partner?
A. Very similar culture and resources
B. Compatible expectations and objectives
C. They should have as much to lose as you do if the alliance fails
D. Resources that complement your own
Answer: A. Very similar culture and resources
184. When there is a fit between the goals of the organization and the goals of individuals, this is known as:
A. Goal fit
B. Goal congruence
C. Goal hierarchy fit
D. Goal coordination
Answer: B. Goal congruence
185. Which of the following is correct?
A. An organization’s structure would be expected to evolve as it grew larger and more diverse
B. Every organization starts out with a simple structure, then moves to a functional structure before becoming divisionalized
C. Network structures are superior to functional ones
D. Organizational performance will suffer if the structure is not stable
Answer: A. An organization’s structure would be expected to evolve as it grew larger and more diverse
186. The shape or format of reporting and decision making relationships can be defined as theorganizational:
A. Span of control
B. Architecture
C. Hierarchy
D. Chain of command
Answer: C. Hierarchy
187. The main components of an organization’s architecture are structural hierarchy, values andbelief systems, contracts and relationships and (two more):
A. Control systems and ways of working
B. Information infrastructure and power structures
C. Control systems and power structures
D. Control systems and information infrastructure
Answer: D. Control systems and information infrastructure
188. A ‘vertical architecture’ is one which:
A. Has a tall hierarchy
B. Has many layers of management
C. Extends beyond the boundaries of legal ownership
D. Is very bureaucratic
Answer: C. Extends beyond the boundaries of legal ownership
189. Organizational structures and systems can be judged using five dimensions (ABCDE) to assess whether they are achieving an appropriate balance. These five dimensions are Autonomy, Bureaucracy, Cultural Control, Decentralization and:
A. Equal Opportunities
B. Economic Incentives
C. Equality and Diversity
D. Evidence of Learning
Answer: B. Economic Incentives
190. Employees who work in an autonomous fashion are:
A. Given freedom to make decisions
B. Closely monitored
C. Heavily influenced by organizational culture
D. Motivated by non-financial rewards
Answer: A. Given freedom to make decisions
191. Bureaucracy is sometimes seen as a negative thing but it has some benefits for organizations. Which of the following is NOT a benefit of bureaucracy?
A. It can make information easier to share
B. It can reduce errors
C. It can increase organizational flexibility
D. It can ensure that stakeholders are treated consistently
Answer: C. It can increase organizational flexibility
192. Successful business relationships tend to:
A. Combine relational contracts – to build trust in the long term – with transactional contracts to cover specific situations
B. Depend upon tightly written legal contracts that take account of every potential problem or issue
C. Rely upon firms being able to trust their employees and partners
D. Be treated as finite games that both partners know will end sooner or later
Answer: A. Combine relational contracts – to build trust in the long term – with transactional contracts to cover specific situations
193. Goffee and Jones use two variables to classify organizational cultures. These are:
A. Sociability and Synergy
B. Cohesion and Synergy
C. Sociability and Solidarity
D. Solidarity and Cohesion
Answer: C. Sociability and Solidarity
194. Hyperglobalization is a process of globalization which —
A. emphasizes the rise of regionalism
B. emphasizes the rise of nation states
C. emphasizes the rise of the TNC and decline of the nation state
D. emphasizes the decline of the TNC
Answer: C. emphasizes the rise of the TNC and decline of the nation state
195. Economic globalization is characterized by —
A. rise of regionalism
B. international migration
C. cross-cultural flows of ideas
D. international trade and investment flows
Answer: D. international trade and investment flows
196. Cultural homogeneity refers to —
A. cross-cultural movements
B. inter-cultural movements
C. adaptation to the local culture
D. cultural uniformity
Answer: D. cultural uniformity
197. The process of glocalization is —
A. emphasis on local culture
B. the use of regional symbols
C. an amalgamation of the global and the local
D. emphasis on global culture
Answer: C. an amalgamation of the global and the local
198. Political globalization is the process of —
A. changes in the rules and structures of global governance
B. rise of the WTO
C. change in political systems
D. emergence of a political ideology
Answer: A. changes in the rules and structures of global governance
199. South–South co-operation means —
A. the flow of resources from one developing country to another
B. increasing diplomatic relations among emerging economies
C. increasing investment between developing countries
D. rising trade between countries
Answer: A. the flow of resources from one developing country to another
200. International orientation refers to —
A. a gradual process of internationalization
B. a firm’s modes of entry into international business
C. an attitude or strategic predisposition of a TNC towards internationalization
D. the stage theory of internationalization
Answer: C. an attitude or strategic predisposition of a TNC towards internationalization
201. Ethnocentric orientation is a predisposition towards —
A. regionalism
B. the home country
C. the global economy
D. geographically proximate regions
Answer: B. the home country
202. Pull factors refer to —
A. offensive motives of internationalization
B. strategic motivation
C. market motives of internationalization
D. resource-seeking motives
Answer: A. offensive motives of internationalization
203. Business entities engaged in international business activity are commonly known as-
A. NGOs
B. EOUs
C. State-trading corporations
D. TNCs
Answer: D. TNCs
204. Credits transferable by original beneficiary in favor of secondary beneficiary areknown as
A. Deferred credits
B. Transit credits
C. Installment credits
D. Transferable credits
Answer: A. Deferred credits
205. When the exporter, expects the importer, to make the payment immediately upon the draftbeing presented to him is called.
A. Sight Draft.
B. Usance Draft
C. Demand draft
D. Pay Note
Answer: A. Sight Draft.
206. The basic objective of export Promotion Council is to promote and develop the Exports of the
A. Particular products of country
B. Only attractive projects of the country
C. Only services industry products of the country
D. none
Answer: A. Particular products of country
207. Ethical issues concerning business and public sector organizations exist at three levels:
A. Macro; Corporate; Individual.
B. Corporate; Business; Functional.
C. Corporate; Functional; Individual.
D. Business; Family; Individual.
Answer: A. Macro; Corporate; Individual.
208. The culture of an organization can be conceived as consisting of four layers.
A. Values, beliefs, behaviors and taken-for-granted assumptions.
B. Values, belief, tasks.
C. Belief, tasks, personalities.
D. Individual, functional, organizational.
Answer: C. Belief, tasks, personalities.
209. The primary stakeholders are:
A. Customers.
B. Suppliers.
C. Shareholders.
D. Creditors.
Answer: C. Shareholders.
210. The goal of corporate governance and business ethics education is to:
A. Teach students their professional accountability and to uphold their personal Integrity to society.
B. Change the way in which ethics is taught to students.
C. Create more ethics standards by which corporate professionals must operate.
D. Increase the workload for accounting students.
Answer: D. Increase the workload for accounting students.
211. The corporate governance structure of a company reflects the individual companies’
A. Cultural and economic system.
B. Legal and business system.
C. Social and regulatory system.
D. All of the above.
Answer: A. Cultural and economic system.
212. The internal audit function is least effective when the department:
A. Is non-independent.
B. Is competent.
C. Is objective.
D. Exhibits integrity
Answer: A. Is non-independent.
213. Under which theory both internal and external corporate governance mechanisms are Intended to induce managerial actions that maximize profit and shareholder value.
A. Shareholder theory.
B. Agency theory.
C. Stakeholder theory.
D. Corporate governance theory.
Answer: D. Corporate governance theory.
214. Which theory states that, lack of resources often helps countries to become competitive
A. Competitive theory
B. Porters Diamond Model
C. Theory of Mercantilism
D. Product life cycle theory
Answer: B. Porters Diamond Model
215. Theory of Mercantilism propagates
A. Encourage exports and imports
B. Encourage exports and discourage imports
C. Discourage exports and imports
D. Discourage exports and encourage imports
Answer: D. Discourage exports and encourage imports
216. General electric follows ___________ as its international operational strategy
A. Global
B. International
C. Multi-domestic
D. Transnational
Answer: C. Multi-domestic
217. In 90’s the global management perception was based on
A. Standardization v/s adaptation
B. Globalization v/s localization
C. Global integration v/s Local Responsiveness
D. Local responsiveness
Answer: D. Local responsiveness
218. Which one is not an international organisation
A. SAARC
B. ASEM
C. ASEAN
D. CBDT
Answer: A. SAARC
219. ‘De-coupling’ denotes.
A. Indian market may be cutt off from global markets so that it may be affected by global volatility.
B. Separating the birds affected by bird flue.
C. that markets are independent.
D. None of the above.
Answer: D. None of the above.
220. Out of the following, one is not related with WTO
A. TRIPS
B. Ministerial Conference
C. TRIMS
D. TRAI
Answer: D. TRAI
221. What is Euro-lll?
A. European Currency
B. Group of European Countries
C. European Film Festival
D. Pollution central Scale
Answer: A. European Currency
222. A letter of credits means
A. A bank agreeing to accept and pay on due date
B. A letter containing conditions of credit purchase or sale
C. A letter sent by exporter to importer sanctioning credit dial.
D. A letter sent by importer to exporter sanctioning credit deal.
Answer: A. A bank agreeing to accept and pay on due date
223. The 21st member to join the G-20 is
A. Sri Lanka
B. Uzbekistan
C. Myanmar
D. Urugway
Answer: C. Myanmar
224. Each member of IMF, is assigned a quota expressed in
A. Member country’s currency
B. Dollar
C. Special Drawing Rights
D. None of the above
Answer: B. Dollar
225. In independent India, the first major foreign exchange crisis occurred in the year __ .
A. 1955
B. 1956
C. 1969
D. 1991
Answer: C. 1969
226. Geographical indication specifies:
A. Place of origin of goods only
B. Special characteristics of product associated with place of origin.
C. Both (a) and (b)
D. none
Answer: A. Place of origin of goods only
227. Strategic alliance cannot be between:
A. Manufacturer and supplier
B. Competitors
C. Non- competitors
D. None of the above
Answer: C. Non- competitors
228. The mode of entry into international business with least risk to the firm is
A. Export house
B. Trading house
C. A manufacturing exporter
D. Merchant exporter.
Answer: D. Merchant exporter.
229. A global company can———– its experience to expand its global operations
A. Contract
B. Expand
C. Minimize
D. Leverage
Answer: A. Contract
230. Governmental regulations can affect the viability & ———– of a company using theinternet as a foreign market entry mode.
A. Effectiveness
B. Association
C. Performance
D. None of the above
Answer: C. Performance
231. ______ typically offer more flexibility in international markets.
A. SMEs
B. LSEs
C. MNEs
D. None of the above
Answer: D. None of the above
232. Which of the following is not a driver of globalization?
A. The fragmentation of consumer tastes between countries.
B. The competitive process.
C. Multinational companies successfully persuading governments to lower trading barriers.
D. The need to gain economies of scale.
Answer: C. Multinational companies successfully persuading governments to lower trading barriers.
233. Globalization is beneficial for firms because:
A. It protects them against foreign competition.
B. It cushions them from the effects of events in other countries.
C. It opens up new market opportunities.
D. It increases the risk and uncertainty of operating in a globalizing world economy.
Answer: B. It cushions them from the effects of events in other countries.
234. The internet facilitates globalization by:
A. Making it more difficult to contact potential customers abroad.
B. Cutting the cost for firms of communicating across borders.
C. Making it harder to send money from one country to another.
D. Making it easier for governments to censor the information received by their citizens from abroad.
Answer: A. Making it more difficult to contact potential customers abroad.
235. Globalization can create problems for business because:
A. It can result in more competition.
B. It increases vulnerability to political risk and uncertainty when operating abroad.
C. It means that they can increase prices.
D. All of the options given are correct.
Answer: B. It increases vulnerability to political risk and uncertainty when operating abroad.
236. How does international law facilitate international trade and investment?
A. It makes it easier to resolve contract disputes for firms involved in international trade and investment.
B. It allows business to choose the most favorable national legal system to institute proceedings.
C. The terms used in international conventions are open to differing interpretations.
D. The Uniform Commercial Code favors big US multinationals.
Answer: C. The terms used in international conventions are open to differing interpretations.
237. Laws relating to The Single Market Program allow EU-based companies to:
A. Move goods and services from any member state to another.
B. Transfer managers to any member state.
C. Invest anywhere in the EU.
D. All of the options given.
Answer: A. Move goods and services from any member state to another.
238. Competition Law in the EU means that firms:
A. Are free to set up international cartels.
B. May be refused permission to take over a US competitor.
C. Can not be made to repay government financial assistance.
D. Can cross-subsidise loss-making services from profitable activities.
Answer: C. Can not be made to repay government financial assistance.
239. The existence of different currencies is beneficial to private financial institutions because:
A. Each country has its own currency.
B. The exchange rate of each currency is fixed by the International Monetary Fund.
C. A collapse in the exchange rate of a currency can cause economic disruption.
D. Profits can be made from arbitrage.
Answer: A. Each country has its own currency.
240. The International Monetary Fund is important because:
A. It has sufficient financial resources to deal with a major global financial crisis.
B. It has sufficient financial resources to help individual countries facing balance of payments problems.
C. Emerging economies can exercise significant influence on it.
D. It fixes exchange rates.
Answer: A. It has sufficient financial resources to deal with a major global financial crisis.
241. What functions do financial institutions traditionally perform?
A. They immobilise savings.
B. They concentrate risk.
C. They spread risk.
D. They offer only short-term finance.
Answer: A. They immobilise savings.
242. Ethnocentric views concentrate on their
A. home country
B. host country
C. world orientation
D. Raci al orientation
Answer: A. home country
243. Specific cultural dimensions that does not have a significant impact on cross nationalbusiness interactions is
A. Hofstede’s five cultural dimensions
B. Monochromatic vs polychromatic tune
C. Communication
D. Geography
Answer: D. Geography