CBA Ch. 1 LS

________ business is business that is carried out across national borders.
International
_____ business denotes the operations of a company outside its home market.
Foreign
A company with operations in multiple nations is referred to as a(n):
International Company
International business differs from domestic because they must deal with the forces form which of the following environments?
Foreign, Domestic, International
Environments are classified as:
Internal and external
What are the external forces that management has no direct control over, although it can exert influence?
Uncontrollable forces
Internal forces are called ____ forces
controllable
The ___ environment is all the ___ forces originating in the home country that surround and influence the development of the company.
domestic; uncontrollable
The forces in the _____ environment are the same as those in the _____ environment except that they occur outside the firm’s home country
foreign; domestic
Which of the following are true regarding the international environment?
-it consists of interactions between two or more domestic environmental forces
-it consists of the interactions between the domestic environmental forces and the foreign environmental forces
-it involves the crossing of international borders
-it consists of interactions between the foreign environmental forces of two countries
all except “it consists of interactions between two or more domestic environmental forces”
Which of the following adds complexity to foreign environments?
unfamiliarity with other cultures
What is the unconscious reference to your own values when judging behaviors of others in a new and different environment?
self reference criterion
Which one of the worst natural disasters in history is associated with international trade?
the plague
Which empire had the effect of raising the cost of asian trade for europeans and drove the search for sea routes to asia
Ottoman
Which of the following are trading firms was formed to carry out colonial activities in Asia and open ocean trade routes to the East?
Dust East India Company
Which of the following was one of the first US companies to own foreign production facilities, have worldwide distribution networks, and market its products under global brands?
Singer Sewing Machines
Which of the following statements are true regarding a transnational corporation?
-it is a made up of only one entity in a foreign nation
-it operates under a decision making system that allows a common strategy
-it is comprised of entities in more than one nation
-it operates under a decision making system that allows coherent policies
all except the first one “it is made up of only one entity in a foreign nation”
True or False: When nations and corporations are ranked by GNI and total sales respectively, 41 of the first 100 on the list are corporations.
True
What term refers to direct investments in equipment, structures, and organizations in a foreign country at a level sufficient to obtain significant management control?
Foreign Direct Investment
True or False: Importing is the transportation of any domestic good to a destination outside a country.
False
Which of the following are typical arguments against globalization?
-globalization has worsened labor standards
-it produces friction between nations
-it has been linked to a decline in environmental conditions
-it produces uneven results across nations
all but produces friction between nations
Which of the following regions have not experienced economic success despite efforts to liberalize and privative its economies?
-asia
-latin america
-eastern europe
-sub-saharan africa
latin america and sub-saharan africa
Which of the following statements are true regarding the impact of globalization on labor?
-us companies moving abroad to avoid unionization has risen
-developing nations tend to have lower labor standards
-companies are experiencing difficulties divesting their interest in one country and moving to another
-jobs will migrate to developing nations where labor costs are lower
all except “companies….another”
The definition of International business include
-foreign manufacturing
-international trade
-domestic trade
-service industries
all except domestic trade
An ________ company is a company with operations in multiple nations.
international
Competitive
kinds and numbers of competitors, their locations, and their activities
Financial
variables such as interest rates, inflation rates, and taxation
Economic
variables (such as gross national income, unit labor cost, and personal consumption expenditure) that influence a firm’s ability to do business
Legal
the many foreign and domestic laws governing how international firms must operate
Political
elements of nations’ political climates such as nationalism, forms of government, and international organizations
Physical
elements of nature such as topography, climate, and national resources
The ____ environment is all the uncontrollable forces originating in the home country that surround and influence the development of the company
domestic
The ______ environment consists of interactions between the domestic environmental forces and the foreign environmental forces
international
A ______ corporation is an enterprise made up of entities in more than one nation, operating under a decision making system that allows a common strategy and coherent policies
transnational
The tendency toward international integration and interdependency of goods, technology, information, labor, and capital is called economic _______
globalization
Which of the following are arguments supporting globalization
-free trade eliminates poverty
-free trade enhances socioeconomic development
-free trade produces even results in every nation
-free trade promotes better and more jobs
enhances socioeconomic development and promotes better and more jobs
Free trade enhances _____ development
socioeconomic
T or F: The levels of foreign direct investment and exporting have been decreasing rapidly in recent years
false; increasing
Which of the following aspects are contributing to the globalization of business operations
-progressive reduction of barriers to trade and foreign investment by governments
-privatization of much of the industry in formerly communist nations
-rapid increase of trade restrictions that limit foreign competition
-increase int eh political barriers to entry in the form of quotas and tariffs
progressive and privatization
Global communication networks that enable manufacturing workers to coordinate production and design functions worldwide is an example of a ____ driver
technological
Preferential trading arrangements such as NAFTA and the European Union would be considered _____ drivers
political
Which of the following statements are true regarding the link between free trade and jobs?
-free trade can cause companies to go out of business
-free trade promotes new, better jobs
-free trade stifles economic growth and expansion
-free trade promotes more jobs
all except “stifles”
Which of the following is NOT considered a major driver of internationalization?
-competitive
-cultural
-technological
-market
cultural
Which of the following is true of a globalized product line?
-reduces production cost
-reduces gross national income
-reduces development costs
-reduces inventory costs
all but gross national income
New firms, mainly from newly industrialized countries, entering the world markets in computers and electronics is an example of a ______ driver
competitive
Decision making in the _____ environment is more complex than it is in a purely ______ environment
international; domestic
Companies internationalizing their operations to capture the supply of key raw materials is an example of a _____ driver
competitive
An accounting firm establishing foreign operations in markets where their principal accounts are located to prevent competitors from gaining access is an example of a _____ driver
market
Which of the following are true transnational corporations?
-they account for about 75% of total global output
-they account for about 2/3 of world trade
-they collectively employe more than 78 million people
-they have about 810,000 foreign affiliates
all but “75% of total global output”
Data suggests that the liberation of trade has improved:
-life expectancy
-poverty rate
-education
-health
-crime rate
all but crime
T or F: Domestic forces do not affect foreign operations
False
A company investing in a downstream market as a way to protect its existing international business is an example of a ____ driver
competitive
Which of the following human conditions has been attributed to the liberation of trade
-greater civil liberties
-increase in infant mortality
-increase spending on public education
-increase in politic rights
all but increase in infant mortality because it should be decrease
Current trends indicate that the world’s economic center of gravity is shifting to _____
Asia
Which of the following are true of state-owned transnational corporations
-state-owned transnationals account for more than 30% of the world’s foreign direct investments
-state-owned transnationals collectively have assets exceeding $2 trillion
-minimum of 550 state-owned transnationals
-state-owned transnationals come from both developing and developed countries
all but “state-owned transnationals account for more than30%…”
Which UN agency is in charge of all matters relating to FDA and international corporations
United nations conference on trade and development
In international business, what are the three choices international manager have in deciding what to do with a concept employed in domestic operations

-change the natural culture
-adapt it to local conditions
-not use it overseas
-transfer it intact

all but “change national culture”
Which of the following are international organizations whose actions affect the international market?
-worldwide bodies
-organizations bound by industry agreements
-regional economic groupings of nations
-organizations bound by interstate commerce
all but “bound by interstate commerce”
Which centuries have been termed the “age of mercantilism”
17th and 18th
_____ means to sell the same thing in the same way everywhere in the world
globalization
Which of the following sectors of human life were profoundly impacted by international trade?
-politics
-religion
-agriculture
-public health
-arts
all but religion
Which of the following are trends in new markets abroad?
-economies in some nations growing faster then the rate of the home country
-developing markets with a rising gross domestic product per capita
-vast proportion of potential customers are still located within us
-there are developing markets with a rising population
all but potential clients in us
Barriers to the free movement of a nation’s people, such as mountain ranges, help maintain pockets of distinct cultures within a country, and thus effecting the decision making of a company is an example of:
forces being interrelated
____ have grown faster than world output in nearly each of the past 60 years
merchandise exports
Sanctions being placed on Russia and Russian companies in response to Russia’s actions in the Ukraine is an example of
forces in the foreign environment having different values
Which of the following foreign forces are especially difficult to access?
-legal
-physical
-technology
-political
legal and political
Which country was the world’s leading manufacturing country for about 1800 years until replaced by Britain in 1840
china
Which of the following are some negative affects of the north american free trade agreement?
-substantial increases in air pollution along US Mexico border
-it increases ground water pollution across US Mexico border
-it increases population along US Mexico border
-it increases in environmental standards along US Mexico border
all but “increase in environmental standards” because they decreased
T or F: The vast proportion of most US companies’ potential customers are located within US
false; We only have 5%
The World Development Indicators form the World Bank show that the number of people in extreme poverty has _____
declined