MNMT 3850 CHAPTER 15
HOMEWORK QUESTIONS AND
ANSWERS
Essentials of Entrepreneurship & Small Business Mgmt., 7e (Scarborough)
Chapter 15 Global Opportunities
1) Becoming a global entrepreneur requires:
A) constant innovation.
B) maintaining a high level of quality and constantly improving it.
C) being sensitive to foreign customers' unique requirements and adopting a more respectful
attitude toward foreign habits and customs.
D) All of the above
Answer: D
Diff: 1 Page Ref: 570
AACSB: Reflective Thinking
Learning Obj.: 1
2) For an entrepreneur, expanding into international markets:
A) guarantees its success in the marketplace.
B) makes it a member of GATT automatically.
C) helps it grow faster and survive competition better.
D) leads to business failure for companies under $100 million in annual revenue.
Answer: C
Diff: 2 Page Ref: 570
AACSB: Analytic Skills
Learning Obj.: 1
3) The first obstacle an entrepreneur must overcome on the way to creating a truly global
business is:
A) finding a joint venture partner.
B) learning to think globally.
C) locating motivated, multilingual managers for overseas assignments.
D) finding overseas distributors for the company's products.
Answer: B
Diff: 1 Page Ref: 570
AACSB: Reflective Thinking
Learning Obj.: 1
4) Before going global, entrepreneurs should ask themselves questions regarding:
A) profit potential and commitment of resources for a global effort.
B) a viable exit strategy and the cost of not going global.
C) the reasons, rationale, and understanding cultural differences.
D) All the above
1
,Answer: D
Diff: 1 Page Ref: 572
AACSB: Analytic Skills
Learning Obj.: 1
2
,5) All of these are steps small companies follow when they begin conducting global business on
the Web except:
A) connecting to e-mail.
B) building a globally accessible Web site.
C) setting up links to related company Web sites.
D) using the Web to conduct international market research.
Answer: C
Diff: 2 Page Ref: 574
AACSB: Use of IT
Learning Obj.: 2
6) Which of the following statements is/are true regarding export management companies?
A) Most are merchant intermediaries that work on a buy-and-sell arrangement with domestic
small companies.
B) They provide small businesses with a low-cost, efficient, independent, international marketing
department.
C) Many specialize in particular products or product lines and offer services ranging from market
research and advice or patent protection, to arranging financing and handling shipping.
D) All of the above
Answer: D
Diff: 1 Page Ref: 575-576
AACSB: Reflective Thinking
Learning Obj.: 2
7) An export trading company:
A) is a business that buys and sells products in many countries, either in its own name or as an
agent for its buyer-seller clients.
B) typically offers a wide range of services such as exporting, shipping, storing, distributing, and
others to their clients.
C) is formed by an agreement by which a licenser gives a foreign licensee the right to use a
patent, trademark, copyright, technology, and products in return for a percentage of the licensee's
sales or profits.
D) Both A and C above
Answer: D
Diff: 1 Page Ref: 575-576
AACSB: Reflective Thinking
Learning Obj.: 2
8) Which of the following trade intermediaries lowers the risk of exporting for a small business?
A) Export management companies
B) Export trading companies
C) Resident buying offices
D) All of the above
Answer: D
Diff: 1 Page Ref: 575-576
AACSB: Reflective Thinking
Learning Obj.: 2
3
, 9) ________ act as international sales representatives in a limited number of markets for various
noncompeting domestic companies, typically operating on a commission basis.
A) Manufacturers' export agents
B) Export merchants
C) Resident buying offices
D) Foreign distributors
Answer: A
Diff: 1 Page Ref: 576
AACSB: Analytic Skills
Learning Obj.: 2
10) A resident buying office is:
A) a business that buys and sells products in many countries, either in its own name or as an
agent for its buyer-seller clients.
B) a government-owned or business-owned facility set up in a foreign country to buy products
that are made there.
C) a firm in an overseas distribution network selling noncompetitive products made by other
firms.
D) formed by an agreement where a licenser gives a foreign licensee the right to use a patent,
trademark, copyright, technology, and products in return for a percentage of the licensee's sales
or profits.
Answer: B
Diff: 2 Page Ref: 577
AACSB: Analytic Skills
Learning Obj.: 2
11) ________ are domestic wholesalers who do business in foreign markets, buying goods from
domestic companies and selling them in foreign markets, often handling competing lines.
A) Resident buying offices
B) Export trading companies
C) Foreign distributors
D) Export merchants
Answer: D
Diff: 1 Page Ref: 577
AACSB: Analytic Skills
Learning Obj.: 2
12) Foreign distributors offer small businesses which of the following benefits?
A) A detailed knowledge of the local markets in which they sell
B) The ability to cover a foreign sales territory thoroughly
C) The ability to handle all of the marketing, distribution, and service functions in foreign
markets
D) All of the above
Answer: D
Diff: 1 Page Ref: 577
AACSB: Reflective Thinking
Learning Obj.: 2
4
HOMEWORK QUESTIONS AND
ANSWERS
Essentials of Entrepreneurship & Small Business Mgmt., 7e (Scarborough)
Chapter 15 Global Opportunities
1) Becoming a global entrepreneur requires:
A) constant innovation.
B) maintaining a high level of quality and constantly improving it.
C) being sensitive to foreign customers' unique requirements and adopting a more respectful
attitude toward foreign habits and customs.
D) All of the above
Answer: D
Diff: 1 Page Ref: 570
AACSB: Reflective Thinking
Learning Obj.: 1
2) For an entrepreneur, expanding into international markets:
A) guarantees its success in the marketplace.
B) makes it a member of GATT automatically.
C) helps it grow faster and survive competition better.
D) leads to business failure for companies under $100 million in annual revenue.
Answer: C
Diff: 2 Page Ref: 570
AACSB: Analytic Skills
Learning Obj.: 1
3) The first obstacle an entrepreneur must overcome on the way to creating a truly global
business is:
A) finding a joint venture partner.
B) learning to think globally.
C) locating motivated, multilingual managers for overseas assignments.
D) finding overseas distributors for the company's products.
Answer: B
Diff: 1 Page Ref: 570
AACSB: Reflective Thinking
Learning Obj.: 1
4) Before going global, entrepreneurs should ask themselves questions regarding:
A) profit potential and commitment of resources for a global effort.
B) a viable exit strategy and the cost of not going global.
C) the reasons, rationale, and understanding cultural differences.
D) All the above
1
,Answer: D
Diff: 1 Page Ref: 572
AACSB: Analytic Skills
Learning Obj.: 1
2
,5) All of these are steps small companies follow when they begin conducting global business on
the Web except:
A) connecting to e-mail.
B) building a globally accessible Web site.
C) setting up links to related company Web sites.
D) using the Web to conduct international market research.
Answer: C
Diff: 2 Page Ref: 574
AACSB: Use of IT
Learning Obj.: 2
6) Which of the following statements is/are true regarding export management companies?
A) Most are merchant intermediaries that work on a buy-and-sell arrangement with domestic
small companies.
B) They provide small businesses with a low-cost, efficient, independent, international marketing
department.
C) Many specialize in particular products or product lines and offer services ranging from market
research and advice or patent protection, to arranging financing and handling shipping.
D) All of the above
Answer: D
Diff: 1 Page Ref: 575-576
AACSB: Reflective Thinking
Learning Obj.: 2
7) An export trading company:
A) is a business that buys and sells products in many countries, either in its own name or as an
agent for its buyer-seller clients.
B) typically offers a wide range of services such as exporting, shipping, storing, distributing, and
others to their clients.
C) is formed by an agreement by which a licenser gives a foreign licensee the right to use a
patent, trademark, copyright, technology, and products in return for a percentage of the licensee's
sales or profits.
D) Both A and C above
Answer: D
Diff: 1 Page Ref: 575-576
AACSB: Reflective Thinking
Learning Obj.: 2
8) Which of the following trade intermediaries lowers the risk of exporting for a small business?
A) Export management companies
B) Export trading companies
C) Resident buying offices
D) All of the above
Answer: D
Diff: 1 Page Ref: 575-576
AACSB: Reflective Thinking
Learning Obj.: 2
3
, 9) ________ act as international sales representatives in a limited number of markets for various
noncompeting domestic companies, typically operating on a commission basis.
A) Manufacturers' export agents
B) Export merchants
C) Resident buying offices
D) Foreign distributors
Answer: A
Diff: 1 Page Ref: 576
AACSB: Analytic Skills
Learning Obj.: 2
10) A resident buying office is:
A) a business that buys and sells products in many countries, either in its own name or as an
agent for its buyer-seller clients.
B) a government-owned or business-owned facility set up in a foreign country to buy products
that are made there.
C) a firm in an overseas distribution network selling noncompetitive products made by other
firms.
D) formed by an agreement where a licenser gives a foreign licensee the right to use a patent,
trademark, copyright, technology, and products in return for a percentage of the licensee's sales
or profits.
Answer: B
Diff: 2 Page Ref: 577
AACSB: Analytic Skills
Learning Obj.: 2
11) ________ are domestic wholesalers who do business in foreign markets, buying goods from
domestic companies and selling them in foreign markets, often handling competing lines.
A) Resident buying offices
B) Export trading companies
C) Foreign distributors
D) Export merchants
Answer: D
Diff: 1 Page Ref: 577
AACSB: Analytic Skills
Learning Obj.: 2
12) Foreign distributors offer small businesses which of the following benefits?
A) A detailed knowledge of the local markets in which they sell
B) The ability to cover a foreign sales territory thoroughly
C) The ability to handle all of the marketing, distribution, and service functions in foreign
markets
D) All of the above
Answer: D
Diff: 1 Page Ref: 577
AACSB: Reflective Thinking
Learning Obj.: 2
4
