CHAPTER 1 GLOBALIZATION
TRUE/FALSE QUESTIONS 1. Globalization benefits Apple by helping it sell the same iPod models worldwide with little or
no modification.
2. Globalization does not affect national economies and standards of living. 3. International business is any commercial transaction that crosses the borders of two or more
nations.
4. Imports are goods and services brought into a country that are acquired from organizations
located abroad.
5. Exporting is any business transaction that crosses the borders of two or more nations. 6. E-business (e-commerce) is the use of computer networks to purchase, sell, or exchange
goods and services, service customers, collaborate with partners, and transact within a company.
7. Globalization is the trend toward greater economic, cultural, political, and technological
interdependence among national institutions and economies.
8. Denationalization refers to national boundaries becoming less relevant. 9. Internationalization refers to national boundaries becoming less relevant. 10. Products marketed in all countries essentially without any changes are called “international
products.”
11. Companies that sell global products can reduce costs by standardizing various aspects of their
marketing activities.
12. A company that sells a global product can explore opportunities abroad if the home market is
small or becomes saturated.
13. Globalization of production refers to convergence in buyer preferences in markets around the
world.
14. The General Agreement on Tariffs and Trade (GATT) was a treaty designed to promote free
trade by reducing both tariffs and nontariff barriers to international trade.
15. Today, the institution of the General Agreement on Tariffs and Trade (GATT) continues to
promote free trade.
16. The World Trade Organization (WTO) is the international organization that regulates trade
between nations.
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Ch 1: Globalization 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33.
The power of the General Agreement on Tariffs and Trade (GATT) to settle trade disputes is what sets it apart from its predecessor, the World Trade Organization (WTO).
Because of its ability to penalize offending nations, the World Trade Organization (WTO) dispute settlement system truly is the spine of the global trading system.
Resistance to worldwide trade agreements is causing some nations to place greater emphasis on regional pacts.
Gross national product (GNP) is the value of all goods and services produced by a country during a one-month period, excluding income generated by both domestic production and the country’s international activities.
GDP or GNP per capita is a nation’s GDP or GNP multiplied by its population. Although falling barriers to trade and investment discourage globalization, technological innovation is accelerating the process.
Videoconferencing provides access to a company’s computer network from distant locations using personal computers.
Businesses are using the Internet to sharpen their forecasting, lower their inventories, and improve communication with their suppliers.
Intranets provide access to a company’s computer network from distant locations using personal computers.
Extranets give distributors and suppliers access to a company’s database to place orders or restock inventories electronically and automatically.
Innovation in the shipping industry is facilitating globalization by making shipping more efficient and dependable.
One remarkable commonality among the world’s least-global nations is their low levels of corruption.
Globalization may have added to nationalist sentiments and aggravated tensions between countries leading up to the First World War.
A “backlash to globalization” in the early 1800s helped usher in high tariffs and barriers to immigration.
The protests against globalization we witness today are far more orderly than those of several years ago.
While globalization has coincided with an increase in the number of man-made and natural disasters, it is also likely responsible for them.
Globalization creates new risks and accentuates old ones for companies because it exposes them to new threats as well as to new opportunities.
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34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. ) 48. 49.
Ch 1: Globalization
The World Bank is an agency created to provide financing for national economic development efforts.
The International Monetary Fund (IMF) is an agency created to regulate fixed exchange rates and enforce the rules of the international monetary system.
The political agenda of an organization does not generally influence its claims and findings on the beneficial or harmful effects of globalization.
Critics of globalization argue that it eliminates jobs and forces wages lower in developed nations and exploits workers in developing countries.
Globalization protesters claim that it is responsible for the elimination of manufacturing jobs in developed nations.
Critics charge that globalization and international outsourcing exploit workers in low-wage nations.
Pro-globalization economists believe globalization decreases wealth and efficiency in both developed and developing nations.
Openness to international trade allows a nation’s businesses to become more efficient and pass the resulting savings on to consumers.
Globalization defenders believe globalization creates positive benefits by reducing labor market flexibility in developed nations.
Globalization supporters believe that benefits result from worker dislocation, or “churning” as it is called when there is widespread job turnover throughout an economy.
Flexible labor markets allow workers to be redeployed rapidly to sectors of the economy where they are highly valued and in demand.
Globalization opponents argue that globalization and international outsourcing help to advance developing nations’ economies.
Both supporters and critics of globalization appear to agree that it causes dislocation in labor markets.
Critics of globalization believe the overall gains that may accrue to national economies are worth the lost livelihoods that individuals may suffer.
Results of studies support critics’ allegations that economic openness and foreign investment contribute to lower labor standards.
Opponents to globalization argue that it causes a “race to the bottom” in environmental conditions and regulations.
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Ch 1: Globalization 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66.
Opponents to globalization say that it allows international firms to exploit local labor and the environment, and then simply export their goods back to the home country.
Few international firms support reasonable labor and environmental laws because future local markets for their goods and services are likely to be small.
Some countries have advanced their economies by harnessing the forces of globalization, while others have not.
In the debate over inequality, studies suggest that developing nations are unable to boost incomes of their poorest members of society by integrating themselves into the global economy.
In the debate over inequality, poor nations open to world trade and investment appear to grow faster than rich nations.
Although studies tend to conclude that global inequality has risen in recent decades, they differ on the extent of the rise in global poverty.
Globalization supporters argue that one of the most amazing consequences of globalization has been the spread of democracy worldwide.
National culture is a weak shaper of a people’s values, attitudes, customs, beliefs, and communication styles.
Globalization supporters argue that it allows us all to profit from our differing circumstances and skills.
Globalization protesters complain that it is homogenizing our world and destroying the rich diversity of cultures it contains.
Although globalization may cause political and economic ideologies to diverge, deeper elements of culture may not be as easily affected.
A business that has direct investments abroad in multiple countries is called a multinational corporation (MNC).
Multinational corporations are the focus of the business media in part because of their large economic impact.
Large companies from the least developed nations dominate international business. It is common for large companies’ business deals such as mergers and acquisitions to be valued in the trillions of dollars.
Multinationals dominate the international business news for two reasons: they are highly visible because of their economic and political muscle, and their mergers and acquisitions are often valued in the billions of dollars.
Many mergers are allowed today that would have been halted years ago because the nature of competition today is truly global, not national, and a market must be measured on that basis.
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67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82.
Ch 1: Globalization
Although multinational corporations are economically very powerful, the revenue of the world’s largest business is still far below the gross domestic product of the smallest nation. Japan has the largest number of Global 500 companies.
Technology makes the world market more accessible for companies that sell traditional products by lessening the cost and difficulties associated with global communication. A born-global firm is a company that takes a global perspective on its market and engages in international business from or near its inception.
Research has found that only large companies can export successfully.
The most obvious difference between domestic and international business is that international business occurs between two or more nations that can have entirely different societies and commercial environments.
International business occurs within a dynamic, integrated system that weaves together four distinct elements.
Although globalization is a potent force, it still does not transform our societies and commercial activities.
There is very little or no export financing available for small businesses.
The dynamic nature of globalization creates increasing competition for all companies everywhere, as managers begin to see the entire world as an opportunity.
Each national business environment is composed of unique cultural, political, legal, and economic characteristics that define business activity within that nation’s borders. Some businesses can become completely immune to all events in the international business environment.
Today, it is very rare for a business to search simultaneously for production bases and markets.
The characteristics of national business environments define the context of international business management.
Highly centralized production and marketing activities mean that businesses today seldom interact with people in distant locations within the international business environment. The integrating power of globalization forces managers and their firms to be knowledgeable about the nations in which they operate.
MULTIPLE CHOICE QUESTIONS 83. Globalization benefits Apple by allowing it to sell the same iPod models worldwide with
little or no ________.
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Ch 1: Globalization
a. b. c. d.
84.
standardization modification exportation advertising
Selling songs from its iTunes Music Store for 99 cents each, ________ is the digital-music industry’s undisputed world leader. a. Hewlett-Packard b. Microsoft c. Dell d. Apple All goods and services brought into a country that are acquired from organizations located abroad are called ________. a. gross domestic product (GDP) b. exports c. foreign trade d. imports ________ is (are) any commercial transaction that crosses the borders of two or more nations. a. Exports b. Gross national product (GNP) c. International business d. Imports ________ is (are) all goods and services produced or based in one country that are sold abroad. a. Necessities b. Exports c. Global licensing d. Imports The total value of goods and services that cross national borders each year is ________. a. nearly $23 trillion b. around $16 trillion c. less than $9 trillion d. more than $36 trillion ________ is the use of computer networks to purchase, sell, or exchange goods and services, service customers, collaborate with partners, and transact within a company. a. E-business (e-commerce) b. Intranet c. International business d. Extranet ________ is the trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies. a. International business b. Market entry strategy c. Globalization d. E-business
85.
86.
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90.
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91.
Ch 1: Globalization
Globalization is the trend toward greater economic, cultural, ________, and ________ interdependence among national institutions and economies. a. regional; national b. temporary; mutual c. domestic; international d. political; technological ________ refers to convergence in buyer preferences in markets around the world. a. Homogenization of markets b. Globalization of markets c. Internationalization of markets d. Denationalization of markets Globalization is the trend characterized by ________ (national boundaries becoming less relevant), and is different from ________ (entities cooperating across national boundaries). a. political integration; technological advances b. globalization of production; globalization of markets c. internationalization; denationalization d. denationalization; internationalization Denationalization refers to________. a. a loss of sovereignty in markets b. national boundaries becoming less relevant c. cooperation between national actors to reduce trade barriers d. the total elimination of borders between nations
________ are products marketed in all countries essentially without any changes. a. National products b. Adapted products c. Global products d. National services
The globalization of markets benefits companies by ________. a. reducing costs through the standardization of marketing activities b. strengthening national sovereignty c. creating new market opportunities d. both a and c e. all of the above
The dispersal of production activities to locations that help a company achieve its cost-minimization or quality-maximization objectives for a good or service is known as ________. a. importing b. globalization of production c. global strategy d. globalization of markets A key to international success for global managers is to ________. a. know the customer b. emphasize global awareness c. develop world-class products d. market products effectively e. all of the above
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Ch 1: Globalization 99.
Whereas relocating production to low-cost locales traditionally meant production of ________ almost exclusively, it increasingly applies to the production of ________. a. services; goods b. extranets; intranets c. goods; services d. mobile phones; backpacks The globalization of production benefits companies by allowing them to ________. a. access lower-cost workers b. access production inputs c. access technical expertise d. level uneven income streams e. a, b, and c
Two major forces that underlie the expansion of globalization are ________ and ________. a. visa regulations; declining tourism b. trademarks; patents c. trade barriers; political unrest d. falling barriers to trade and investment; technological innovation A major flaw of the original General Agreement on Tariffs and Trade (GATT) was that it lacked the power to ________. a. erect barriers to trade b. dismantle bilateral trade agreements c. govern exchange rates d. enforce world trade rules
Three main goals of the ________ are to help the free flow of trade, help negotiate the further opening of markets, and settle trade disputes between its members. a. General Agreement on Tariffs and Trade (GATT) b. World Trade Organization (WTO) c. World Bank d. International Monetary Fund (IMF) A group of nations smaller than the World Trade Organization (WTO) but still committed to fostering trade and boosting cross-border investment is the ________. a. North American Free Trade Agreement (NAFTA) b. European Union (EU) c. Organization of Petroleum Exporting Countries (OPEC) d. both a and b The value of all goods and services produced by a country during a one-year period, including income generated by both domestic production and the country’s international activities is called ________. a. gross domestic product (GDP) b. imports and exports (IAE) c. gross national product (GNP) d. globalization of production (GOP) _______ give distributors and suppliers access to a company’s database to place orders or restock inventories electronically and automatically.
100.
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a. b. c. d.
107.
Intranets
Videoconferencing Extranets Hackers
Ch 1: Globalization
Advancements in ________ and ________ are helping to globalize markets and production activities. a. human resource management; international security b. information technologies; transportation methods c. establishing trade barriers; slower economic growth d. all of the above In measuring globalization, a factor that makes some countries more global than others is ________. a. economic integration b. personal contact c. technological connectivity d. political engagement e. all of the above
Barriers facing some of the world’s “least global” nations include ________. a. never-ending political unrest and corruption b. recurring droughts c. volatile prices on commodity markets d. terrorism e. all of the above The ________ tends to capture the broad nature of globalization. a. Failed States Index b. Globalization Index c. Political Risk Index d. Human Development Index There was a first age of globalization that extended from ________. a. the mid-1700s to the 1850s b. the mid-1800s to the 1920s c. 1920 to 1950 d. 1960 to 2000
The first age of globalization was abruptly halted by the arrival of the ________. a. First World War b. Russian Revolution c. Great Depression d. Second World War e. a, b, and c For 75 years, from the start of the First World War to the end of the Cold War, there was a geographic divide between ________, and an ideological divide between ________. a. North and South; protectionism and socialism b. North and South; regionalism and globalization c. East and West; regionalism and globalization d. East and West; communism and capitalism
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Ch 1: Globalization 114.
New challenges created by the globalization of markets and production forces companies to pay increased attention to their ________. a. physical facilities b. information systems c. reputations d. all of the above Many groups opposed to globalization complain that it ________. a. costs jobs b. lowers labor and environmental regulations c. increases income inequality d. reduces individuals’ political say e. all of the above
The ________ is an agency created to provide financing for national economic development efforts. a. International Monetary Fund b. World Trade Organization c. European Union d. World Bank The ________ is an agency created to regulate fixed exchange rates and enforce the rules of the international monetary system. a. International Monetary Fund b. World Trade Organization c. European Union d. World Bank Opponents to globalization argue that it ________. a. eliminates jobs in developed nations b. forces wages lower in developed nations c. exploits workers in developing countries d. all of the above
Opposition groups say ________ causes worker dislocation that results in a gradual ratcheting-down of wages. a. denationalization b. globalization c. internationalization d. nationalism Supporters of globalization argue that it ________. a. increases wealth and efficiency in both developed and developing nations b. generates labor market flexibility in developed nations c. creates jobs in developed nations d. helps advance developing nations’ economies e. all of the above
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121.
Ch 1: Globalization
A main difference between the two sides in the globalization debate is whether overall gains that may accrue to ________ are worth the lost livelihoods that ________ may suffer. a. some industries; organizations b. national economies; individuals c. certain businesses; geographic regions d. individuals; national economies Trade unions claim that by permitting international firms to continually move to nations with relatively lower labor standards, globalization ________ labor’s bargaining power and forces overall labor standards ________. a. strengthens; to improve b. slows down; abroad c. reduces; lower d. increases; higher A special region in which companies can engage in tariff-free importing and exporting is called a(n) ________. a. regional economic integration zone (REIZ) b. U.S. customs zone (USCZ) c. export-processing zone (EPZ) d. free trade area (FTA) Globalization critics say it causes a “race to the ________” in environmental conditions and regulations. a. end b. top c. middle d. bottom e. finish The three main branches of the debate over income inequality are ________. a. inequality surrounding nations, inequality regarding nations, and global equality b. inequality within nations, inequality between nations, and global inequality c. equality among nations, equality between nations, and regional inequality d. equality within nations, equality between nations, and local equality National sovereignty generally involves the idea that a nation-state ________. a. is autonomous b. can freely select their own government c. cannot intervene in the affairs of others d. can control movements over its borders e. all of the above Those opposed to globalization say that it ________ democracy, while those favoring globalization say that it ________ democracy worldwide. a. undercuts; spreads b. strengthens; bolsters c. supports; undercuts d. augments; hinders
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Ch 1: Globalization 128.
Globalization ________ argue that it allows us all to profit from our differing circumstances and skills. a. supporters b. critics c. theories d. both a and b A business that has direct investments (in the form of marketing or manufacturing subsidiaries) abroad in multiple countries is called a ________. a. born-global firm b. multinational corporation c. multi-regional company d. direct exporter The world’s largest company, Wal-Mart, has ________ employees. a. nearly 3 million b. about 800,000 c. about 1.8 million d. nearly 200,000
In this current age of globalization, small companies are increasingly active in international ________ and ________. a. politics; trade b. security; culture c. trade; investment d. jobs; wages In this current age of globalization, companies are ________ earlier and ________ faster, often with help from technology. a. downsizing; creating Web sites b. exporting; growing c. producing; experimenting d. hiring; downsizing ________ makes the world market more accessible for companies that sell traditional products by lessening the cost and difficulties associated with global communication. a. Technology b. Merger-mania c. Licensing d. Financial capital Key characteristics of born-global firms are an ________ and knowledge-based organizational capabilities. a. inventive R&D center b. insular management style c. integrated global network d. innovative culture Key characteristics of a ________ are an innovative culture and knowledge-based organizational capability. a. developed nation
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b. c. d.
136.
born-global firm
homogeneous company globally diverse firm
Ch 1: Globalization
The arrival of the born-global firm ________. a. implies that any firm can engage in international business activity b. inspires optimism for a future of international business characterized by thriving
global diversity
c. both a and b d. none of the above
137. As modeled in your text, the “global business environment” consists of four distinct elements:
globalization, national business environments, the international business environment, and ________. a. falling trade and investment barriers b. international firm management c. technological innovation d. multinational corporations
138. ________ is the dynamic force transforming our societies and commercial activities and
causing increased competition for all firms. a. Consumerism b. Globalization c. Logistics d. Nature
139. Separate ________ are composed of unique cultural, political, legal, and economic
characteristics that define business activity within that nation’s borders. a. national business environments b. drivers of globalization c. international business environments d. industries
140. ________ differ(s) from management of a purely domestic firm in nearly all respects.
a. National business environments b. Globalization c. International business environment d. International firm management
SCENARIO QUESTIONS
Scenario: Tacky Toys and Mushi Toys Tacky Toys, a U.S.-based toy retailer, buys all its merchandise from Mushi Toys, a Japan-based toy manufacturer with production facilities in 12 nations. Mushi Toys markets its toys globally without modification.
141. Tacky Toys buying its merchandise from Mushi Toys is called ________.
a. importing b. bartering c. exporting
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Ch 1: Globalization
d.
142.
globalization
Mushi Toys selling its products to Tacky Toys is called ________. a. importing b. bartering c. exporting d. globalization The products that Mushi Toys manufactures are best described as ________. a. global products b. Internet products c. value-added exports d. tangible products Mushi Toys is best described as a(n) ________. a. domestic company b. multinational company c. direct exporter d. Internet-based company
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144.
Scenario: Donna Bader, Global Executive Donna Bader is a successful global business executive with 15 years marketing experience throughout Europe. Donna is participating in a forum designed to prepare young executives for their initial forays into international business.
145. According to Donna, a key to success in global markets is having detailed knowledge of what
international customers want, and ensuring that the company is flexible enough to customize products to meet those needs. Donna is referring to the notion of ________. a. improving logistics b. knowing how to analyze a problem c. marketing effectively d. knowing the customer
146. Which of the following statements would Donna argue AGAINST?
a. Successful managers know that customers everywhere demand reliability b. Successful managers start out with a solution to any problem c. Logistics is becoming crucial for large international companies d. Successful managers know their customers extremely well
(b; Moderate; p. 8; LO1)
147. Suppose a company wanted to improve its ability to efficiently procure raw materials, supply
components to manufacturing, and deliver products to customers in a timely fashion. Donna would advise this company to ________. a. emphasize global awareness b. know its customers c. know how to analyze a problem d. improve logistics
148. Donna believes that to be successful globally a company must design and build products and
services for export from the beginning, not as an afterthought following the conquest of domestic markets. We can say that Donna believes companies should ________.
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a. b. c. d.
know their customers
emphasize global awareness develop world-class products market effectively
Ch 1: Globalization
Scenario: Jeans, Unlimited Jeans, Unlimited produces clothing for young adults. It designs its clothes at its New York
headquarters, and produces them at facilities in two Southeast Asian countries. The company recently received negative press after one of its facilities was found using questionable, albeit legal, labor
practices—including employing child labor and operating in a manner that damages the environment.
149. The facilities that Jeans, Unlimited operates in Southeast Asia are examples of ________.
a. global products b. international business c. the globalization of markets d. the globalization of production
150. Which of the following arguments against globalization would best apply to the situation in
which Jeans, Unlimited finds itself? a. Globalization creates jobs and boosts wages in developed and developing nations b. Globalization empowers supranational institutions at the expense of national
governments
c. Globalization causes companies to produce in nations having the least strict labor and
environmental regulations
d. Globalization is widening the gap in average incomes between rich and poor nations
151. Jeans, Unlimited has designed a new line of accessories and must build a new facility to
produce them. To avoid paying tariffs when importing raw materials for processing and when exporting finished goods, the company should consider locating its assembly plant in a(n) ________. a. developing country b. export processing zone c. tariff-free environment d. import processing zone
Scenario: Sabrina’s Spices & Sauces
Last year, Sabrina Shin started a business selling all types of spices and hot sauces. The business is small but this entrepreneur’s dreams are big. Given limited demand and sales fluctuations in the domestic market, Sabrina has been considering going international. Yet she has little information, many doubts, and no guidance.
152. Which of the following can help Sabrina reach consumers in different corners of the world
faster and cheaper? a. Intranet b. Extranet c. Salespeople in every nation d. Internet
153. If you were to advise Sabrina on the myths versus facts of exporting, which of the following
would you say is a fact? a. Only large companies can export successfully
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Ch 1: Globalization
b. c. d. e.
154.
Sabrina’s products do not need export licensing
Small businesses have no place to turn for export advice There is no export financing available for Sabrina’s business All of the above
If Sabrina needs $500,000 to expand her business internationally, which of the following organizations might be her best bet? a. Export-Import Bank b. World Trade Organization c. Small Business Administration d. Friends Which of the following can offer expert advice to Sabrina and is a comprehensive resource for information on federal export-assistance programs? a. Trade Information Center b. World Trade Organization c. Export-Import Bank d. GATT
155.
SHORT-ANSWER QUESTIONS
156. iTunes U is a service for colleges and universities that lets students download educational
materials and other content to their ________ and watch or listen on the go.
157. ________ is any commercial transaction that crosses the borders of two or more nations.
158. Goods and services brought into a country that are acquired from organizations located
abroad are called ________.
159. Goods and services produced or based in one country that are sold abroad are called
________.
160. ________ is the use of computer networks to purchase, sell, or exchange goods and services,
service customers, collaborate with partners, and transact within a company.
161. The trend toward greater economic, cultural, political, and technological interdependence
among national institutions and economies is called ________.
162. Globalization is a trend characterized by ________, which refers to national boundaries
becoming less relevant.
163. The term _______ refers to entities cooperating across national boundaries.
164. ________ refers to convergence in buyer preferences in markets around the world.
165. Products marketed in all countries essentially without any changes are called ________.
166. Companies that sell global products can reduce costs by ________ certain marketing
activities.
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167. 168. 169. 170. 171. 172. 173. 174. 175. 176. 177. 178. 179. 180. 181. 182.
Ch 1: Globalization
Makers of global seasonal products may supplement domestic sales with ________ to level their income streams.
________ refers to the dispersal of production activities to locations that help a company achieve its cost-minimization or quality-maximization objectives for a good or service. The quest for natural ________ draws many companies into international markets. The “Keys to International Success” described in the book, offers the following advice for global managers: know the customer, emphasize ________ awareness, develop world-class products, market effectively, improve logistics, know how to analyze problems.
The two main forces that underlie the globalization of markets and production are ________ and technological innovation.
In 1947, political leaders of 23 nations made history when they created the ________, a treaty designed to promote free trade by reducing both tariffs and nontariff barriers to international trade.
The ________ is the international organization that regulates trade between nations. The value of all goods and services produced by a domestic economy over a one-year period is called ________.
________ is a measure of a nation’s income that excludes income generated from exports, imports, and the international operations of its companies.
We can speak in terms of ________ when we sum all individual nations’ gross domestic product (GDP) figures.
Gross domestic product (GDP) is a somewhat narrower figure than ________, the value of all goods and services produced by a country during a one-year period, including income generated by both domestic production and the country’s international activities. A country’s gross domestic product (GDP) per capita is simply its GDP divided by its ________.
An ________ gives distributors and suppliers access to a company’s database to place orders or restock inventories electronically and automatically.
Significant advancements in information technology and ________ methods are making it easier, faster, and less costly to move data, goods, equipment, and people around the world. The Globalization Index comprises a compilation of over a dozen variables within four categories, including political engagement, ________ connectivity, personal contact, and economic integration.
Drivers of the first age of globalization (from the mid-1800s to the 1920s) included the steamship, telegraph, railroad, and later, the ________ and airplane.
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Ch 1: Globalization 183. 184. 185. 186. 187. 188.
Drivers of this second age of globalization (including communication satellites, fiber optics, microchips, and the ________) are lowering the cost of telecommunications.
The ________ is an agency created to provide financing for national economic development efforts.
The ________ is an agency created to regulate fixed exchange rates and enforce the rules of the international monetary system.
Protesters claim that globalization is responsible for the elimination of ________ jobs in developed nations.
Pro-globalization economists believe that globalization ________ wealth and efficiency in both developed and developing nations.
Globalization ________ argue that globalization and international outsourcing help to advance developing nations’ economies.
189. ________ are special areas in which companies engage in tariff-free importing and exporting. (Export-processing zones (EPZs); Moderate; p. 21; LO3)
190. The three main branches of the debate over income inequality are inequality within nations,
inequality between nations, and ________.
191. Countries that threw open their doors to world trade and investment experienced ________
growth rates in gross domestic product (GDP) per capita than rich nations.
192. ________ involves the idea that a nation-state: (1) is autonomous; (2) its people can freely
select their own government; (3) cannot intervene in the affairs of others; (4) can control movements over its borders; and (5) its political authorities can enter into binding international agreements.
193. National ________ is a strong shaper of a people’s values, attitudes, customs, beliefs, and
communication styles.
194. ________ allows countries to specialize in producing goods and services in which they are
most efficient.
195. Largely because of advances in ________, small and medium-sized companies are
accounting for a greater portion of international business.
196. A multinational corporation (MNC) is a business that has ________ investments abroad in
multiple countries.
197. The rise of a new international entity called the ________ suggests that any firm, regardless
of age, experience, and resources, can engage in international business.
198. The four elements comprising the “global business environment” include ________, national
business environments, the international business environment, and international firm management.
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199.
Ch 1: Globalization
The drivers of globalization (technological innovation and ________) influence every element of the global business environment.
ESSAY QUESTIONS
200. Define international business and explain how it affects each of us in our daily activities.
201. Define imports and exports and explain the main ways in which they differ.
202. Define e-business (e-commerce) and explain how it helps companies conduct international
business.
203. Define globalization and identify its main characteristics.
204. Summarize each benefit a company might obtain from the globalization of markets.
205. How might a company benefit from the globalization of production?
206. Identify several “keys to success” for global managers.
207. Describe the two major forces that drive globalization and how they work together to expand
globalization.
208. Identify the World Trade Organization’s (WTO) three main goals and how the WTO differs
from the General Agreement on Tariffs and Trade (GATT).
209. Explain why growth in world trade is outpacing growth in world output.
210. Explain how technological innovation impacts globalization and how it is accelerating the
process.
211. What factors help make some countries more global than others? Identify several highly
global nations.
212. How does this current period of globalization compare with the first age of globalization?
213. Identify several global challenges that international firms face with regard to security matters.
214. Compare and contrast the purposes of the World Bank and the International Monetary Fund.
215. Identify several positions on each side of the globalization debate.
216. Summarize the claims made against globalization regarding its impact on jobs and wages,
and the responses of globalization supporters.
(Moderate; p. 18-20; LO3)
217. Summarize the claims made against globalization regarding its impact on labor and
environmental regulations, and the responses of globalization supporters.
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Ch 1: Globalization 218. 219. 220. 221. 222. 223. 224. 225.
What does the balance of evidence suggest for each of the three branches in the debate over globalization and income inequality?
What are the arguments of each side in the debate over globalization’s impact on national sovereignty?
Summarize the claims made against globalization regarding its influence on cultures, and the responses of globalization defenders.
Identify all the different types of companies that participate in international business. Why are entrepreneurs and small companies increasingly active in international trade and investment?
What are several myths that keep small companies from engaging in exporting and the facts that dispel these myths?
Describe the “global business environment” model and each of its four elements. How does globalization affect the other three main elements in the “global business environment” model?
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