1
MGCR 382 FINAL EXAM/ACTUAL EXAM
QUESTIONS WITH ALL PASSED
SOLUTIONS/NEWEST UPDATE for a Specific
Exam Mail
What is globalization?
Ans: The widening set of interdependent relationships among people from
different parts of a world that is divided into nations.
Interdependence may involve economic, cultural, political, and / or
technological dimensions
MNC (multinational corporation), MNE (multinational enterprise), TNC
(transnational company) - used interchangeably in this class
Ans: All refer to a company that operates in more than one country.
Seven forces driving globalization
Ans: 1. Increase in and application of technology
2. Liberalization of cross-border trade and resource movements
3. Development of services that support international business
4. Growth of consumer pressures
5. Increased global competition
6. Changing political situations and government policies
7. Expanded cross-national cooperation
"Born Global" organizations
Pretest - Stuvia US
,2
Ans: Seven forces driving globalization may be so strong that new
organizations adopt a global focus from the start. This is often dependent on
the founders' history, mission & vision, and contextual factors
Multiple potential costs of globalization
Ans: Threats to national sovereignty (lose freedom to "act locally")
Economic growth and environmental stress (growth consumes nonrenewable
natural resources and increases environmental damage)
Growing income inequality and personal stress (promotes global superstars at
the expense of others)
Offshoring and its pros and cons
Ans: Offshoring is a type of outsourcing that involves transferring production
abroad.
It can be beneficial because it reduces costs, but it also means that the jobs
move abroad. However, offshoring may also create new, better jobs at
home.
How does geographic distance affect international business strategy and
organization?
Ans: Natural resources are present in some locations and not others
Talent is concentrated in some locations
Transportation costs are not uniform even within a country
Communications and coordination costs rise with global operations
How does economic distance affect international business strategy and
organization?
Pretest - Stuvia US
,3
Ans: Purchasing power varies between and within countries (challenge to
design product / service for sale in a country with lower purchasing power
than the home country)
Wages vary between countries (firms can lower costs by offshoring activities
to a country with wages below the home country. High distance is an
advantage)
"Flat versus spiky world" debate
Ans: Flat world -- world is flattening and shrinking due to web and internet;
flattening increases opportunity and intensifies global competition; lower
logistics costs means that global value chains go up. An example of
evidence for flattening is the rise of MNCs that have headquarters in
emerging economies
Spiky world -- the economic landscape has steep peaks and valleys; uneven
distribution of innovation; clusters and backwaters matter, and there is
uneven growth and opportunity; uneven distribution of population as well as
an urban/rural disparity in developing countries. An example of evidence for
the spiky world view is the distribution of where patents and citations come
from (clustered in parts of North America, Europe, East Asia).
5 myths of globalization
Ans: 1. Globalization is new
2. Globalization is extensive
3. Globalization is unavoidable
4. Globalization erases geographical distance
5. Globalization erases economic distance
In which directions can a firm grow?
Pretest - Stuvia US
, 4
Ans: Vertically (value chain -- closer to or farther from the customer),
horizontally (products / services -- expanded breadth of offerings),
geographically (location -- new spots), "growing the core" (selling more
volume in one place)
Value chain charts
Ans: (look in slides)
How can a firm choose to grow?
Ans: Organic (go it alone), joint venture / partnership (collaborate), or
merger / acquisition (unify)
Reasons why companies engage in international business -- whether, where,
how
Ans: 1. To expand sales. Pursuing international sales increases the potential
market and potential profits
2. To acquire resources. May give companies lower costs, new or better
products, and additional operating knowledge
3. To diversify or reduce risks. International operations may reduce operating
risk by smoothing sales and profits, preventing competitors from gaining
advantage.
Types of exports and imports in international business
Pretest - Stuvia US
MGCR 382 FINAL EXAM/ACTUAL EXAM
QUESTIONS WITH ALL PASSED
SOLUTIONS/NEWEST UPDATE for a Specific
Exam Mail
What is globalization?
Ans: The widening set of interdependent relationships among people from
different parts of a world that is divided into nations.
Interdependence may involve economic, cultural, political, and / or
technological dimensions
MNC (multinational corporation), MNE (multinational enterprise), TNC
(transnational company) - used interchangeably in this class
Ans: All refer to a company that operates in more than one country.
Seven forces driving globalization
Ans: 1. Increase in and application of technology
2. Liberalization of cross-border trade and resource movements
3. Development of services that support international business
4. Growth of consumer pressures
5. Increased global competition
6. Changing political situations and government policies
7. Expanded cross-national cooperation
"Born Global" organizations
Pretest - Stuvia US
,2
Ans: Seven forces driving globalization may be so strong that new
organizations adopt a global focus from the start. This is often dependent on
the founders' history, mission & vision, and contextual factors
Multiple potential costs of globalization
Ans: Threats to national sovereignty (lose freedom to "act locally")
Economic growth and environmental stress (growth consumes nonrenewable
natural resources and increases environmental damage)
Growing income inequality and personal stress (promotes global superstars at
the expense of others)
Offshoring and its pros and cons
Ans: Offshoring is a type of outsourcing that involves transferring production
abroad.
It can be beneficial because it reduces costs, but it also means that the jobs
move abroad. However, offshoring may also create new, better jobs at
home.
How does geographic distance affect international business strategy and
organization?
Ans: Natural resources are present in some locations and not others
Talent is concentrated in some locations
Transportation costs are not uniform even within a country
Communications and coordination costs rise with global operations
How does economic distance affect international business strategy and
organization?
Pretest - Stuvia US
,3
Ans: Purchasing power varies between and within countries (challenge to
design product / service for sale in a country with lower purchasing power
than the home country)
Wages vary between countries (firms can lower costs by offshoring activities
to a country with wages below the home country. High distance is an
advantage)
"Flat versus spiky world" debate
Ans: Flat world -- world is flattening and shrinking due to web and internet;
flattening increases opportunity and intensifies global competition; lower
logistics costs means that global value chains go up. An example of
evidence for flattening is the rise of MNCs that have headquarters in
emerging economies
Spiky world -- the economic landscape has steep peaks and valleys; uneven
distribution of innovation; clusters and backwaters matter, and there is
uneven growth and opportunity; uneven distribution of population as well as
an urban/rural disparity in developing countries. An example of evidence for
the spiky world view is the distribution of where patents and citations come
from (clustered in parts of North America, Europe, East Asia).
5 myths of globalization
Ans: 1. Globalization is new
2. Globalization is extensive
3. Globalization is unavoidable
4. Globalization erases geographical distance
5. Globalization erases economic distance
In which directions can a firm grow?
Pretest - Stuvia US
, 4
Ans: Vertically (value chain -- closer to or farther from the customer),
horizontally (products / services -- expanded breadth of offerings),
geographically (location -- new spots), "growing the core" (selling more
volume in one place)
Value chain charts
Ans: (look in slides)
How can a firm choose to grow?
Ans: Organic (go it alone), joint venture / partnership (collaborate), or
merger / acquisition (unify)
Reasons why companies engage in international business -- whether, where,
how
Ans: 1. To expand sales. Pursuing international sales increases the potential
market and potential profits
2. To acquire resources. May give companies lower costs, new or better
products, and additional operating knowledge
3. To diversify or reduce risks. International operations may reduce operating
risk by smoothing sales and profits, preventing competitors from gaining
advantage.
Types of exports and imports in international business
Pretest - Stuvia US
