C HAPTER 15 THE GLOBAL MARKETPLACE CRS Questions & Answers.

CCHAPTER HAPTER 1515

THE GLOBAL MARKETPLACE

CRS Questions & Answers

Copyright 2007, Prentice-Hall Inc. 15-2

Your firm wants to introduce its goods to South America. The government of Brazil initiates a tax on your imported goods, which is called a:

1. Tariff

2. Quota

3. GATT

4. Trade barrier


Your firm wants to introduce its goods to South America. The government of Brazil initiates a tax on your imported goods, which is called a:

1. Tariff

2. Quota

3. GATT

4. Trade barrier

Tariffs represent one form of trade restriction which is often imposed by foreign governments in order to raise revenue or protect domestic firms.


A country whose industrial structure is classified as a(n) __________ would be the absolute worst choice for a computer manufacturer seeking to market its products abroad.

1. industrial economy

2. industrializing economy

3. raw material exporting economy

4. subsistence economy


A country whose industrial structure is classified as a(n) __________ would be the absolute worst choice for a computer manufacturer seeking to market its products abroad.

1. industrial economy

2. industrializing economy

3. raw material exporting economy

4. subsistence economy

In subsistence economies, the vast majority of people engage in simple agriculture. They consume much of their output and barter only for simple goods and services.


Which of the following are indicators of a market's potential?

1. Demographic characteristics

2. Sociocultural factors

3. Geographic factors

4. All of the above


Which of the following are indicators of a market's potential?

1. Demographic characteristics

2. Sociocultural factors

3. Geographic factors

4. All of the above

Other market potential indicators include economic, political, and legal factors.


Before going abroad, a company should do all of the following EXCEPT:

1. Define its international marketing objectives and policies.

2. Choose how many countries it wants to market to.

3. Decide how it will reinvest the profits of its international venture.

4. Decide the best mode of market entry.


Before going abroad, a company should do all of the following EXCEPT:

1. Define its international marketing objectives and policies.

2. Choose how many countries it wants to market to.

3. Decide how it will reinvest the profits of its international venture.

4. Decide the best mode of market entry.

Deciding how profits will be reinvested is not a critical decision that needs to be made prior to selling abroad.


The Hilton Hotel chain has just completed negotiations to provide management know-how to a foreign company that is contributing the capital investment for a new hotel in Prague, Czech Republic. Hilton is involved in:1. Management contracting

2. Contract manufacturing

3. Licensing

4. Direct investment


The Hilton Hotel chain has just completed negotiations to provide management know-how to a foreign company that is contributing the capital investment for a new hotel in Prague, Czech Republic. Hilton is involved in:1. Management contracting

2. Contract manufacturing

3. Licensing


Management contracting is a low-risk method of gaining entry into a foreign market.


A firm wants to enter an international market in which it has little experience. As the target country has had three civil wars in the last 10 years, the best method of entry is probably:

1. Direct exporting

2. Indirect exporting

3. Joint ownership



A firm wants to enter an international market in which it has little experience. As the target country has had three civil wars in the last 10 years, the best method of entry is probably:

1. Direct exporting

2. Indirect exporting

3. Joint ownership


Indirect exporting involves less investment and less risk because the firm does not require an overseas marketing organization or set of contacts.


Your firm has been in an overseas market for awhile and has worked with business partners to build up a substantial amount of experience with local conditions. It might be time to:1. Begin direct investment

2. Begin a joint venture

3. Begin direct exporting

4. Begin a licensing program


Your firm has been in an overseas market for awhile and has worked with business partners to build up a substantial amount of experience with local conditions. It might be time to:1. Begin direct investment

2. Begin a joint venture

3. Begin direct exporting

4. Begin a licensing program

Direct investing often offers the advantages of lower costs, government investment incentives, full control, and may improve the firm’s image in the host country.


Keiser, Inc. has modified its industrial machine tools for sale in European markets to conform to the metric system. Keiser is engaged in:

1. Straight extension

2. Straight invention

3. Product adaptation

4. Straight adaptation


Keiser, Inc. has modified its industrial machine tools for sale in European markets to conform to the metric system. Keiser is engaged in:

1. Straight extension

2. Straight invention

3. Product adaptation

4. Straight adaptation

Product adaptation involves changing the product to meet local conditions or wants, or as in this case, adapting to the preferred unit of measurement.


In the whole-channel view of international marketing, seller and buyer are linked by:

1. The seller’s headquarters organization

2. Channels between nations

3. Channels within nations

4. All the above


In the whole-channel view of international marketing, seller and buyer are linked by:

1. The seller’s headquarters organization

2. Channels between nations

3. Channels within nations

4. All the above

U.S. manufacturers must pay attention to how products are handled by foreign countries as the products move past borders throughout the nation.


A firm’s first step in entering the global marketplace is often the creation of an:

1. Export department

2. International division

3. International subsidiary

4. International headquarters


A firm’s first step in entering the global marketplace is often the creation of an:

1. Export department

2. International division

3. International subsidiary

4. International headquarters

After creating an export department, firms develop an international division, and finally become a global organization.

C HAPTER 15 THE GLOBAL MARKETPLACE CRS Questions & Answers.

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