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Answered) MNB 4670: Exam 1A Name: ______________________________ Student ID: _______________ Instructions: The total points you can get from this exam is 100....

I need answers for the following questions which are true/false or multiple choice questions.

MNB 4670: Exam 1A
Name: ______________________________ Student ID: _______________ Instructions: The total points you can get from this exam is 100.
TRUE/FALSE (1 point each)
1. MNEs can avoid investing in risky countries
True False 2. MNEs from developing countries can have advantages over MNEs from developed
countries when investing to corrupt countries
True False 3. Dispersion of Value chain framework suggests that MNEs consider differences in cost
and quality only, when allocating different activities
True False 4. Silicon Valley is an example to externalities related to foreign direct investment decisions
of MNEs
True False 5. Regional Trade Blocs are against the idea of protectionism in trade
True False 6. Terrorism and Cyber-Attacks have direct and in-direct effects on MNEs and International
True False 1 7. In emerging countries, low level of Intellectual Property (IP) protection fosters
knowledge transfers from MNEs to local firms, while higher IP protection can help
knowledge spillovers from MNEs to the local firms
True False 8. Uncertainties in an investment decision are perceived as sources of potential revenue for
managers in MNEs
True False 9. Size of a country’s economy is inversely proportional to GNI per capita in that country
True False 10. In countries with autocratic regimes, MNEs can manage political risk effectively by
focusing more on their relationships with the government
True False 11. A company has to be the size of a multinational giant to facilitate, and benefit from, the
globalization of markets.
True False 12. The globalization of markets and production and the resulting growth of world trade,
foreign direct investment, and imports all imply that firms are finding it easier to protect
themselves from the attack of foreign competitors.
True False 13. It is possible that economic growth in developed nations has offset the fall in the share of
national income enjoyed by unskilled workers, raising their living standards.
True False
2 14. The term political economy is used to stress the fact that the political, economic, and
legal systems of a country are independent of each other.
True False 15. The purchasing power parity for different countries is adjusted (up or down) depending
upon whether the cost of living is lower or higher than in the United States.
True False 16. In a market economy, if demand for a product exceeds supply, prices will rise, signaling
to producers that they should produce more.
True False 17. Contracts drafted under a civil law framework tend to be very detailed with all
contingencies spelled out.
True False 18. Increasing Intellectual property laws always stimulate innovation and emerging
country-catch up.
True False 3 MULTIPLE CHOICE QUESTIONS (1 point each) 19. _____ isolated four dimensions—power distance, uncertainty avoidance, individualism
versus collectivism, and masculinity versus femininity—that he claimed summarized
different cultures. A. Dunning
B. Vernon
C. Hofstede
D. Michael Porter
E. Max Weber 20 . Which is/are examples of stereotypes?
IV. Ikea’s “Fartfull” couch in the U.S
The French are arrogant.”
“The Chinese eat anything that moves.”
“Americans are very liberal.”
E. All of the above
II and III only
II,III, IV only
I,IV only
I, II and III only 4 21. Which of the following statements is not true about global institutions?
A. They can be considered as polices of global market place
B. They promote the establishment of multinational treaties
C. They always work for the advantage of countries
D. MNEs can dispute international business cases through them
E. Their agenda is often influenced by MNEs, NGOs, and developed countries
22. _____ refers to a condition where people tend to perceive themselves in terms of their
class background, and this shapes their relationships with members of other classes. A. Social mobility
B. Class consciousness
C. Cross-culture literacy
D. Social awareness
E. Class representativeness 23. Which of the following is/are visible barriers to trade?
VIII. Local Production requirements
Custom duties for foreign firms
Government Subsidies
Lax enforcement of Intellectual Property Laws
e. All of the above
II and III only
1,III, IV only
I,IV only
I, II and III only 24. Which one of below is/are requirements of an effective legal system?
5 I.
III. The people in the society must clearly understand and have knowledge of what the
society prescribes as legal behavior
The legislators must have agreed that the laws deserve to be obeyed
An effective system for punishing illegal behavior must be in place
E. All of the above
II and III only
1 only
I,III only
I and II 25. Which of the following is not true about the aftermath of 2008 Financial Crisis?
A. MNEs were affected as much as the local firms
B. An increase in regulation was observed in the countries affected by the crisis
C. It became harder to get banking loans for individuals and firms
D. There was an increase in disputes that were taken to arbitrage courts
E. US domestic firms responded by investing abroad
26. A ________ demands that some specific fraction of a good be produced domestically
A) Subsidy
B) quota rent
C) voluntary export requirement
D) local content requirement 27. Which of the following is not a political argument for government intervention?
6 A) Protecting jobs
B) protecting infant industries
C) protecting industries deemed important for national security
D) protecting consumers from “dangerous” products 28. Which of the following statements is true about culture?
A. Culture is static as it does not evolve.
B. Multinational enterprises can themselves be engines of cultural change.
C. The cost of doing business in a country or region is always independent of its culture.
D. It is not possible for a country to support multiple cultures.
E. The values and norms of a culture emerge fully formed. 29. Which is not true about failure of multinational service firms such as Walmart in the host
A. Standardization of services while going abroad can have positive effects such as control and
economies of scale
B. Adaptation of services at the host countries can help MNEs to tap into local knowledge
C. A successful strategy in one location can easily be transferred to operations at other locations
D. Managers’ ethnocentric behavior was influential in some of these failures
E. Cultural Sensitivity is more important for the success of multinational
service firms than multinational manufacturing firms 30. China, deliberately keeping its currency value low against the U.S. dollar in order to sell
more goods to the United States, and thus accumulate a trade surplus and foreign exchange
7 reserves, is viewed by critics as following a:
D. Zero-sum game.
Neo-mercantilist policy.
Positive-sum game.
Free trade policy. 31. The United Republic emphasizes individual performance and achievements in every sphere
of society. Which of the following statements is true about the society of this country?
A. The country suffers from a low degree of dynamism and innovation.
B. The country has a low degree of managerial mobility.
C. There is a low degree of entrepreneurial activity in the country.
D. The employees in this country will lack loyalty and commitment to a company.
E. Managers in such a country have highly developed company-specific skills but they
lack general skills. 32. Which of the following statements is true about political systems?
A. The political system of a country is independent of its economic and legal systems.
B. The political system of a country is of no importance to international business.
C. It is not possible to have democratic societies that emphasize a mix of collectivism and
D. it is possible to have totalitarian societies that are not collectivist.
E. The societal culture of a country does not influence its political system. 33. Which of the following best illustrates the globalization of production?
a. Daily Diamonds Inc. buys diamonds from South Africa and exports them to India
for the cutting process.
8 b. Evan Swan, a U.S. based fashion designer, is planning to open a flagship store in
China to serve the Asian market.
c. Uncle Crab, a UK fast food chain, has been serving customers worldwide through
its franchises.
d. Silver Unicorn Inc. uses sales personnel from the respective host country to sell
its products and services. 34. Which of the following is/are non-visible barriers to trade?
XII. Ease of Doing Business for foreign firms
Custom duties for foreign firms
Government Subsidies
Lax enforcement of Intellectual Property Laws
d. All of the above
I only
1,III, IV only
I,IV only 35. Which of the following is most likely to be the best suited product for a global market?
A. Microprocessors
B. Fast food like hamburgers
C. Clothes and accessories
D. Bank and other personal services
E. Household furnishings 9 36. The _____ refers to the sourcing of goods and services from locations around the globe to
take advantage of national differences in the cost and quality of factors such as labor, energy,
land, and capital.
A. globalization of markets
B. augmentation of products
C. amplification of value chain
D. Dispersion of value chain
E. capitalization of markets
37. The _____ is the less controversial sister institution of the IMF which was created along with
the IMF in 1944.
A. G-20
B. International Court of Justice
C. League of Nations
D. World Trade Organization
E. World Bank 10 38. Gerald gifted his son, David, a computer two years ago. Recently, he decided to gift his
daughter, Julian, a computer of her own. In the context of the two year gap between the purchase
of both the computers and Moore's law, it is most likely that:
A. Gerald paid a higher price for Julian's computer.
B. David's computer will have a microprocessor with better power than that of Julian's.
C. both David's and Julian's computers would cost Gerald the same price.
D. the microprocessor in Julian's computer will be more advanced in terms of power than that
of David's.
E. the power of the microprocessors, in both David and Julian's computers, would be the same. 39. Which of the following countries has seen a relative decline in its share of world output
between 1960 and 2010?
A. The United States
B. Thailand
C. Japan
D. China
E. South Korea
40. Which of the following statements is true about the changing foreign direct investment
picture of the global economy?
A. Throughout the 1990s, the amount of investment directed at both developed and developing
nations decreased dramatically.
B. There has been a fall in the share of FDI stock accounted for by developing nations reflecting
a declining trend for firms from these countries to invest outside their borders.
C. Among developing nations, the lowest recipient of foreign direct investment has been China.
D. The share of FDI stock accounted for by U.S. firms has been drastically increasing from
11 12 E. The sustained flow of foreign investment into developing nations is an important stimulus for
economic growth in those countries.
41. After the collapse of communism in Dehran, successful business owners often had to pay
"protection money" to the mafia or face violent retribution. In the context of property rights, the
behavior of the mafia is an example of:
A. active violation.
B. public action.
C. private action.
D. boundary spanning.
E. industrial espionage. 42. When Shop Smart opened its first super market in China it was unable to generate any sales.
After conducting a research, it was understood that the local sales personnel found it difficult to
communicate with the American store managers. In addition, Chinese consumers found it
difficult to shop in the American way. Shop Smart's failure in China can be attributed to the lack
A. cross-cultural literacy.
B. class consciousness.
C. a first-mover advantage.
D. Confucian dynamism.
E. ethnocentrism.
13 43. The risks of doing business are most likely to be the highest in a country that:
A. has low inflation rates.
B. supports high living standards.
C. has only one ethnic nationality.
D. protects intellectual property.
E. faces frequent changes in government and government policy.
44. Jack, the CEO of Silver Touch Inc., raised his eyebrow in surprise at a new employee's
valid suggestion to improve the sales turnover. He made a thumbs-up gesture as a sign of
approval for the implementation of the employee's suggestion. Jack is typically using:
A. spoken communication.
B. nonverbal communication.
C. explicit communication.
D. oral communication.
E. grapevine communication. 45. Managers at the Blue Dragon Inc., an international company with operations in China and the
United States, are often heard complaining about the difficulties in achieving synergy and
cooperation between the employees of both the countries. On extensive research it was
concluded that the cultural differences between these countries, which resulted in different workrelated values, caused the lack of cooperation. In order to effectively tackle this problem, Blue
Dragon Inc. should:
A. vary its management process and practices to account for these differences.
B. adopt the host countries management processes and practices in both countries.
C. opt to exit one of the countries to avoid a conflict.
D. provide incentives to the employees based only on their individual performance.
14 E. adopt the home countries management processes and practices in both countries. Short Paragraph Question
1. List and explain 2 market research approaches that managers use to reduce uncertainty in
their strategy development for international markets? (10 points) 15 2. List indices/rankings that MNEs can use in their investment decisions. List which ones are
more relevant vs. less relevant to the mini-team presentations. (15 points) 3. List firm activities that falls under International Business description. Can Facebook
considered a MNE company? Why? (10 points) 16 4. List the dimensions that make up the International Environment for the International Business.
Indicate what factors these each individual dimensions contain. List the indices you can capture
these dimensions. (20 points)
1. Dimension:
Factors: 2. Dimension:
Factors: 17 3. Dimension:
Factors: 4. Dimension:
Factors: 5. Dimension:
Factors: 18


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