Objective Assessment
EXAM PREP
Managing in a Global Business Environment
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,An employee feels empowered to make decisions to solve customer problems
independent of seeking manager approval and uses flexibility to meet customer
needs.
Which decision-making structure is being used by this employee?
Centralized
Decentralized
Matrix
Functional
Decentralized
Correct! Decentralized decision-making structure is when lower-level employees, like
the one mentioned, make decisions. This type of decision-making may be inconsistent.
Members of a work team are from many different countries. They share their
thoughts on developing a strategy to market a product in several different
countries.
What is the term for the international integration of the team members' exchange
of worldviews and ideas to develop the strategy?
Globalization
Job availability
Wealth inequality
Outsourcing
Globalization
The ability to collectively develop a better product strategy will occur by having a cross-
cultural exchange of ideas to market the product globally. Globalization is when
international integration arises from the interchange of worldviews, products, ideas, and
other aspects of culture.
Which type of globalization refers to the international movement of goods,
capital, and services?
Anti
Cultural
Economic
Social
Economic
The movement of goods and services internationally through trade and trade
agreements is economic globalization. As the world becomes smaller, increased
movement of goods across borders occurs along with trade agreements.
,The CEO of an international company reminds the executive vice presidents that
while the company may do good while performing corporate social
responsibilities, the business has one ultimate goal since it is engaged in
commercial activities with corporate shareholders.
Which ultimate goal is the CEO emphasizing to the executive vice presidents?
Exporting
Cultural exchange
Stakeholder satisfaction
Profitability
Profitability
Ultimately, a company is engaged in commerce to achieve a profit. Business profit is
gauged in financial and economic terms. However, some level of sustained financial and
economic profits is needed for a business to achieve other outcomes that are measured
as social or environmental performance.
A CEO seeks to better use the economies of scale and scope of production to
increase the international company's profits.
Which type of globalization driver is the CEO seeking to use?
Competition
Market
Government
Cost
Cost
Companies seek to put production in low labor-cost countries to lower labor costs and
increase the contribution margin. Economies of scale and scope and the exploitation of
differences in costs for product development, manufacturing, and sourcing in different
parts of the world will assume greater importance as determinants of global strategy.
A CEO is discussing an expansion of production of a company's highly
perishable dairy line in a country that can offer low labor costs and good internet
connections. The country has no highways, and roads are poorly maintained.
Which challenge to international business expansion do the road conditions
present?
Ethical
Infrastructure
Legal
Relational
, Infrastructure
Since the product is perishable, having a good road system is critical to bringing a
product to market before it goes bad. Infrastructure includes the basic physical and
organizational structures needed for a society to operate and for an economy to
function. These include the roads and highways.
Which argument is used by critics who wish to discourage movement towards
globalization?
It increases the wealth of the rich rather than the poor.
It increases consumer prices across the world.
It decreases the pace of new product development.
It decreases awareness of the international community.
It increases the wealth of the rich rather than the poor.
Critics make the argument that globalization only serves to assist the rich in becoming
richer at the expense of the poor.
Which factor is an element of a CAGE analysis when assessing barriers to cross-
border activity?
Census
Economics
Armament
Gross domestic product
Economics
When looking at economics in a CAGE analysis, the economic distance or
socioeconomic differences between countries is evaluated, which includes country size,
income, and access to capital.
Which factor of CAGE addresses differences in country size that affect barriers to
globalization?
Economics
Culture
Geography
Administration
Economics
Economics in the CAGE analysis refers to demographic and economic differences
between countries. When a country size is larger based on gross domestic product, it
produces more products and services, which can be available for international trade.