Question 1

Firms that operate internationally are able to realize location economies by dispersing individual value creation activities to locations where they are performed most efficiently and effectively.

Accepted Answer

A) True 
 B)False

Question 2

In terms of attaining a competitive advantage, support activities can be as important as the primary activities of the firm.

Accepted Answer

A) True 
 B)False

Question 3

Profit growth is measured by the percentage increase in net profits over time.

Accepted Answer

A) True 
 B)False

Question 4

A number of studies have observed that a product's production costs decline by some quantity about each time:

Accepted Answer

A)  annual output is halved.
B)  cumulative output doubles.
C)  the workforce is trimmed by 75 percent.
D)  fixed investment triples.
E)  foreign domestic investment doubles.F) A) and B)
G) All of the above

Question 5

What constitutes an organizational structure?

Accepted Answer

Organizational structure consists of thr...

Question 6

Which of the following terms best represents the systematic reductions in production costs that have been observed to occur over the life of a product?

Accepted Answer

A)  Global web
B)  Dispersion linkage
C)  Economies of scale
D)  Experience curve
E)  Efficiency frontierF) C) and E)
G) A) and C)

Question 7

Which of the following is a primary activity in the operations of a firm?

Accepted Answer

A)  Logistics function
B)  Research and development
C)  Information systems
D)  Human resource function
E)  Company infrastructureF) B) and D)
G) D) and E)

Question 8

Location economies are the economies that arise from performing a value creation activity in the optimal location for that activity, wherever in the world that might be.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements is true about economies of scale?

Accepted Answer

A)  Economies of scale lead to an increase in the average unit cost of a product.
B)  Attaining economies of scale increases a firm's profitability.
C)  The ability to spread variable costs over a large volume is a source of economies of scale.
D)  Economies of scale result due to the increase in the perceived value of a product.
E)  Economies of scale refer to cost savings that come from learning by doing.F) B) and D)
G) C) and E)

Question 10

Serving a global market from a single location is consistent with:

Accepted Answer

A)  establishing a high-cost position.
B)  taking advantage of location economies.
C)  moving down the experience curve.
D)  operating from a position which falls inside the efficiency frontier.
E)  going up the global web.F) B) and D)
G) A) and B)

Question 11

The appropriateness of the strategy that a firm chooses to use in an international market varies with the extent of pressures for:

Accepted Answer

A)  quality improvement and product standardization.
B)  customer surplus and quality improvements.
C)  customer surplus and product standardization.
D)  cost reductions and local responsiveness.
E)  product standardization and cost reductions.F) All of the above
G) B) and D)

Question 12

What are operations of a firm? How can operations be categorized?

Accepted Answer

The operations of a firm can be thought ...

Question 13

The various value creation activities that a firm undertakes are referred to as operations.

Accepted Answer

A) True 
 B)False

Question 14

Learning effects tend to be more significant when:

Accepted Answer

A)  a task involves a few simple steps.
B)  a task is repeated for a period of over five years.
C)  the workforce consists of unskilled labor.
D)  the cumulative output becomes half of what it was originally.
E)  a technologically complex task is repeated.F) A) and D)
G) A) and E)

Question 15

The liberalization of the world trade and investment environment in recent decades, by facilitating greater international competition, has generally:

Accepted Answer

A)  increased cost pressures.
B)  decreased the demand for local responsiveness.
C)  decreased pressures for cost reduction.
D)  increased consumer surplus.
E)  reduced the production of conventional commodity products.F) A) and D)
G) A) and C)

Question 16

Which of the following is true about learning effects?

Accepted Answer

A)  They tend to be more significant in nonrepetitive tasks.
B)  They tend to be less significant when a task is technologically complex.
C)  They typically last a lifetime.
D)  They are important only during the start-up period of a new process.
E)  They do not have any effect on the cost of production.F) A) and B)
G) A) and C)

Question 17

How does possessing a core competence help a firm?

Accepted Answer

A)  It helps a firm to create value in such a way that premium pricing is impossible.
B)  It reduces a firm's dependence on its logistics function.
C)  It enables a firm to reduce the costs of value creation.
D)  It reduces the scope of transfer of skills to foreign markets.
E)  It reduces the need to replicate a business model in a foreign market.F) A) and D)
G) B) and D)

Question 18

Which of the following strategies focuses on increasing profitability by customizing the firm's goods or services so that they provide a good match to tastes and preferences in different national markets?

Accepted Answer

A)  International strategy
B)  Global standardization strategy
C)  Localization strategy
D)  Transnational strategy
E)  Nationalization strategyF) D) and E)
G) A) and B)

Question 19

Pressures for local responsiveness imply that it may not be possible to leverage skills and products associated with a firm's core competencies wholesale from one nation to another.

Accepted Answer

A) True 
 B)False

Question 20

The actions that managers take to attain the goals of the firm are referred to as a firm's strategy.

Accepted Answer

A) True 
 B)False

Exam 12: The Strategy of International Business

The appropriateness of the strategy that a firm chooses to use in an international market varies with the extent of pressures for:

Correct AnswerverifiedShow Answer

Which of the following statements is true about economies of scale?

Correct AnswerverifiedShow Answer

How does possessing a core competence help a firm?

Correct AnswerverifiedShow Answer

In terms of attaining a competitive advantage, support activities can be as important as the primary activities of the firm.

Correct AnswerverifiedShow Answer

The liberalization of the world trade and investment environment in recent decades, by facilitating greater international competition, has generally:

Correct AnswerverifiedShow Answer

Which of the following strategies focuses on increasing profitability by customizing the firm's goods or services so that they provide a good match to tastes and preferences in different national markets?

Correct AnswerverifiedShow Answer

Which of the following terms best represents the systematic reductions in production costs that have been observed to occur over the life of a product?

Correct AnswerverifiedShow Answer

Profit growth is measured by the percentage increase in net profits over time.

Correct AnswerverifiedShow Answer

The actions that managers take to attain the goals of the firm are referred to as a firm's strategy.

Correct AnswerverifiedShow Answer

Which of the following is true about learning effects?

Correct AnswerverifiedShow Answer

What constitutes an organizational structure?

Correct AnswerverifiedOrganizational structure consists of thr...View AnswerShow Answer

Pressures for local responsiveness imply that it may not be possible to leverage skills and products associated with a firm's core competencies wholesale from one nation to another.

Correct AnswerverifiedShow Answer

What are operations of a firm? How can operations be categorized?

Correct AnswerverifiedThe operations of a firm can be thought ...View AnswerShow Answer

The various value creation activities that a firm undertakes are referred to as operations.

Correct AnswerverifiedShow Answer

Firms that operate internationally are able to realize location economies by dispersing individual value creation activities to locations where they are performed most efficiently and effectively.

Correct AnswerverifiedShow Answer

Location economies are the economies that arise from performing a value creation activity in the optimal location for that activity, wherever in the world that might be.

Correct AnswerverifiedShow Answer

A number of studies have observed that a product's production costs decline by some quantity about each time:

Correct AnswerverifiedShow Answer

Which of the following is a primary activity in the operations of a firm?

Correct AnswerverifiedShow Answer

Learning effects tend to be more significant when:

Correct AnswerverifiedShow Answer

Serving a global market from a single location is consistent with:

Correct AnswerverifiedShow Answer

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Organizational structure consists of thr...
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The operations of a firm can be thought ...
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