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Exam 13: The Strategy of International Business

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Question 41

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Economies that arise from performing a value creation activity in the optimal place for that activity are referred to as

A) factor economies.
B) production economies.
C) location economies.
D) value creation economies.

E) A) and B)
F) None of the above

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Question 42

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Global expansion offers companies the opportunity to generate greater profits than companies that focus strictly on

A) value creation.
B) economies of scale.
C) location economies.
D) the domestic market.

E) B) and D)
F) A) and B)

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Question 43

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What strategy focuses on increasing profitability by customizing the firm's goods or services so they provide a good match to tastes and preferences in different national markets?

Enterprises that pursue an international strategy tend to decentralize control over marketing and product strategies.

Top management should be viewed as part of the firm's

________ imply that when a firm already has significant value built into its product offering, increasing value by a relatively small amount requires significant additional costs.

One of the sources of economies of scale is the ability to spread fixed costs over a small volume.

A multinational enterprise doing business in Nigeria decided to change the labeling on its product to conform to local customs and preferences. What type of competitive pressure did this company experience?

Which of the following is associated with firms following the global standardization strategy?

________ activities are basically concerned with creating the product, marketing and delivering the product to buyers, and providing support and after-sales service.

Systematic increases in sales that have been observed to occur over the life of the product are referred to as the experience curve.

________ is measured by the percentage increase in net profits over time.

The distinguishing feature of many firms that pursue ________ strategy is that they are selling a product that serves universal needs, but they do not face significant competitors.

To leverage subsidiary skills, companies should establish incentive systems that encourage local employees to acquire new skills.

Research has shown that in the modern multinational enterprise, core competencies and skills typically reside in the home country.

As competition intensifies, global standardization strategies and transnational strategies tend to become less viable, and managers need to direct their companies toward either an international strategy or a localization strategy.

The ________ all of the different positions that a firm can adopt with regard to adding value to the product and low cost assuming that its internal operations are configured efficiently to support a particular position.

The success of many multinational corporations is based not just upon the goods or services that they sell in foreign nations, but also upon the core competencies that underlie the development, production, and marketing of those goods or services.

Which of the following is an example of a support activity in a firm's value chain?

Pressures for ________ imply that it may not be possible for a firm to realize the full benefits from economies of scale, learning effects, and location economies.