240+ Management of International Business Solved MCQs

Chapters

Chapter: Unit 1
1.

Computer programs are protected as :

A. Copyrights
B. Trade marks
C. Patents.
D. none
Answer» A. Copyrights
2.

Geographical indication specifies:

A. Place of origin of goods only
B. Special characteristics of product associated with place of origin.
C. Both (a) and (b)
D. none
Answer» C. Both (a) and (b)
3.

Strategic alliance cannot be between:

A. Manufacturer and supplier
B. Competitors
C. Non- competitors
D. None of the above
Answer» D. None of the above
4.

The mode of entry into international business with least risk to the firm is :

A. Indirect exports
B. Direct exports
C. Management contract
D. Contract Manufacturing
Answer» A. Indirect exports
5.

The following is an export intermediary:

A. Export house
B. Trading house
C. A manufacturing exporter
D. Merchant exporter.
Answer» C. A manufacturing exporter
6.

A global company can----------- its experience to expand its global operations

A. Contract
B. Expand
C. Minimize
D. Leverage
Answer» D. Leverage
7.

Governmental regulations can affect the viability & ----------- of a company using the internet as a foreign market entry mode.

A. effectiveness
B. association
C. performance
D. None of the above
Answer» A. effectiveness
8.

______ typically offer more flexibility in international markets

A. SMEs
B. LSEs
C. MNEs
D. None of the above
Answer» A. SMEs
9.

From the point of view of marketing, an organization that enjoys competitive advantage in an industry has done so by:

A. Focusing on long-term profit.
B. Charging lower prices than competition.
C. Creating superior value for customers.
D. Constantly enlarging its marketing activities.
Answer» C. Creating superior value for customers.
10.

Regionalism is:

A. An international management orientation and a protectionist policy created to exclude third world countries from certain forms of international trade.
B. The grouping of countries into regional clusters based on geographic proximity.
C. A protectionist policy created to exclude third world countries from certain forms of international trade.
D. An international management orientation.
Answer» B. The grouping of countries into regional clusters based on geographic proximity.
11.

Within an international context, what are 'economies of scope' synonymous with?

A. Reusing a resource from one business/country in additional businesses/countries.
B. Decreased cost per unit of output.
C. Buying components in a bulk.
D. Any of the above.
Answer» A. Reusing a resource from one business/country in additional businesses/countries.
12.

Globalization refers to:

A. A more integrated and interdependent world
B. Less foreign trade and investment
C. Global warming
D. Lower incomes worldwide
Answer» A. A more integrated and interdependent world
13.

Which one of the following is a pull factor in emigration?

A. Political oppression
B. Job opportunities
C. Food shortages
D. War
Answer» B. Job opportunities
14.

Which of the following do NOT facilitate globalization?

A. Improvements in communications
B. Barriers to trade and investment
C. Immigration controls
D. Removal of controls on movement of capital across borders
Answer» B. Barriers to trade and investment
15.

Which of the following could be defined as a multinational company?

A. A firm that owns shares in a foreign company but does not participate in the company's decision making.
B. A UK based internet package holiday firm specializing in selling tours to Turkey to German customers.
C. A firm owning a chain of supermarket outlets outside its country of origin.
D. A finance company transferring its HQ and all its activities from the UK to the US.
Answer» C. A firm owning a chain of supermarket outlets outside its country of origin.
16.

Which of the following is not a driver of globalization?

A. The fragmentation of consumer tastes between countries.
B. The competitive process.
C. Multinational companies successfully persuading governments to lower trading barriers.
D. The need to gain economies of scale.
Answer» A. The fragmentation of consumer tastes between countries.
17.

Globalization is beneficial for firms because:

A. It protects them against foreign competition.
B. It cushions them from the effects of events in other countries.
C. It opens up new market opportunities.
D. It increases the risk and uncertainty of operating in a globalizing world economy.
Answer» C. It opens up new market opportunities.
18.

The internet facilitates globalization by:

A. Making it more difficult to contact potential customers abroad.
B. Cutting the cost for firms of communicating across borders.
C. Making it harder to send money from one country to another.
D. Making it easier for governments to censor the information received by their citizens from abroad.
Answer» B. Cutting the cost for firms of communicating across borders.
19.

Why might MNCs in the past have focused their marketing activities on the triad?

A. That is where the most lucrative markets were located.
B. Income per head in developing countries was relatively low.
C. Transport and communication links were improving outside the tri
Answer» A. That is where the most lucrative markets were located.
20.

Globalization can create problems for business because:

A. It can result in more competition.
B. It increases vulnerability to political risk and uncertainty when operating abroad.
C. It means that they can increase prices.
D. All of the options given are correct.
Answer» A. It can result in more competition.
21.

Which of the following statements on civil law systems would be seen as an advantage by business?

A. Civil law systems operate in very few countries.
B. Relevant areas of law are much easier to find than in common law systems.
C. Relevant areas of law are more difficult to find than in common law systems.
D. Lawyers act as oral advocates for their clients.
Answer» B. Relevant areas of law are much easier to find than in common law systems.
22.

How does international law facilitate international trade and investment?

A. It makes it easier to resolve contract disputes for firms involved in international trade and investment.
B. It allows business to choose the most favorable national legal system to institute proceedings.
C. The terms used in international conventions are open to differing interpretations.
D. The Uniform Commercial Code favors big US multinationals.
Answer» A. It makes it easier to resolve contract disputes for firms involved in international trade and investment.
23.

Laws relating to The Single Market Program allow EU-based companies to:

A. Move goods and services from any member state to another.
B. Transfer managers to any member state.
C. Invest anywhere in the EU.
D. All of the options given.
Answer» D. All of the options given.
24.

Competition Law in the EU means that firms:

A. Are free to set up international cartels.
B. May be refused permission to take over a US competitor.
C. Can not be made to repay government financial assistance.
D. Can cross-subsidise loss-making services from profitable activities.
Answer» B. May be refused permission to take over a US competitor.
25.

The law relating to E-Commerce fits which of the following descriptions:

A. It comprises a single set of laws.
B. The law lacks clarity.
C. There is no problem applying contract law to the internet.
D. The law makes it easy to deal with foreign computer hackers.
Answer» B. The law lacks clarity.
26.

The existence of different currencies is beneficial to private financial institutions because:

A. Each country has its own currency.
B. The exchange rate of each currency is fixed by the International Monetary Fund.
C. A collapse in the exchange rate of a currency can cause economic disruption.
D. Profits can be made from arbitrage.
Answer» D. Profits can be made from arbitrage.
27.

The International Monetary Fund is important because:

A. It has sufficient financial resources to deal with a major global financial crisis.
B. It has sufficient financial resources to help individual countries facing balance of payments problems.
C. Emerging economies can exercise significant influence on it.
D. It fixes exchange rates.
Answer» B. It has sufficient financial resources to help individual countries facing balance of payments problems.
28.

Which of the following are characteristic of the period when financial bubbles burst?

A. Excessive optimism about future asset prices.
B. Excessive pessimism about future asset prices.
C. Rising house prices.
D. Rising share prices.
Answer» B. Excessive pessimism about future asset prices.
29.

What functions do financial institutions traditionally perform?

A. They immobilise savings.
B. They concentrate risk.
C. They spread risk.
D. They offer only short-term finance.
Answer» B. They concentrate risk.
30.

The balance of payments includes which of the following?

A. a country's balance of trade
B. foreign investments
C. foreign aid
D. all of the above
Answer» D. all of the above
31.

Which one of the following is a pull factor in emigration?

A. Political oppression
B. Job opportunities
C. Food shortages
D. War
Answer» D. War
32.

Which of the following do NOT facilitate globalization?

A. Improvements in communications
B. Barriers to trade and investment
C. Immigration controls
D. Removal of controls on movement of capital across borders
Answer» C. Immigration controls
33.

Which of the following constitutes Foreign Direct Investment?

A. A speculator trying to make a profit by buying company shares on a foreign stock exchange.
B. A UK energy company buying territory abroad where it expects to find oil reserves.
C. A tourist purchasing foreign currency to spend on a holiday abro
Answer» B. A UK energy company buying territory abroad where it expects to find oil reserves.
34.

Which of the following is a driver of globalization?

A. Trade barriers and controls on inflows of foreign direct investment.
B. Weak competition.
C. Technological advance.
D. Economies of scale are being exploited to the maximum.
Answer» B. Weak competition.
35.

Globalization is beneficial for firms because:

A. It protects them against foreign competition.
B. It cushions them from the effects of events in other countries.
C. It opens up new market opportunities.
D. It increases the risk and uncertainty of operating in a globalizing world economy.
Answer» A. It protects them against foreign competition.
36.

The internet facilitates globalization by:

A. Making it more difficult to contact potential customers abroad.
B. Cutting the cost for firms of communicating across borders.
C. Making it harder to send money from one country to another.
D. Making it easier for governments to censor the information received by their citizens from abroad.
Answer» D. Making it easier for governments to censor the information received by their citizens from abroad.
37.

Globalization can create problems for business because:

A. It can result in more competition.
B. It reduced vulnerability to political risk and uncertainty when operating abroad.
C. It means that they can increase prices.
D. All of the options given are correct.
Answer» D. All of the options given are correct.
38.

Ethnocentric views concentrate on their

A. home country
B. host country
C. world orientation
D. Racial orientation
Answer» A. home country
39.

In a global market place

A. the entire world is a market place
B. national borders are irrelevant
C. the potential for organizations to grow expands dramatically
D. All of the above
Answer» D. All of the above
40.

In a global market place Managers must

A. deals with economic, political and cultural differences
B. expect competitors to suddenly appear at any time from any place
C. not to take specific differences of local environment into consideration
D. A and B
Answer» D. A and B
41.

Trade Related Investment Measures (TRIMS) doesn’t apply for

A. Measures that affect trade in goods.
B. Measures that lead to restrictions in quantities.
C. Discouraging measures that limit a company’s imports.
D. Discouraging measures that limit a company’s exports.
Answer» B. Measures that lead to restrictions in quantities.
42.

. General Agreement on Trade in Services will not be applicable to

A. Services supplied from one country to another – cross border supply
B. Transaction of goods across the border – Export Import
C. Individuals traveling from own country to supply services in another – presence of natural persons.
D. Consumers/firms making use of a service in another country – consumption abroad.
Answer» B. Transaction of goods across the border – Export Import
43.

As a part of WTO guidelines, Agreement on Agriculture (AOA) doesn’t consider

A. Direct payments to farmers are permitted.
B. Indirect assistance and support to farmers including R & D support by govt. are not permitted.
C. Domestic policies which directly effect on production and trade have to be cut back.
D. Least developed countries do not need to make any cuts.
Answer» B. Indirect assistance and support to farmers including R & D support by govt. are not permitted.
44.

Quantitative restrictions refer to limit set by countries to curb

A. Measures that affect trade in goods.
B. Measures that lead to restrictions in quantities.
C. Discouraging measures that limit a company’s imports.
D. Discouraging measures that limit a company’s exports.
Answer» C. Discouraging measures that limit a company’s imports.
45.

A Most Favored nation status doesn’t necessarily refers to

A. Same and equal economic treatment
B. Non-discriminatory treatment
C. Same tariff rates applicable
D. Uniform civil code
Answer» D. Uniform civil code
46.

The world trade organization was formed in the year _________ with GATT as it basis.

A. 1993
B. 1994
C. 1995
D. 1996
Answer» C. 1995
47.

Specific cultural dimensions that does not have a significant impact on cross national business interactions is

A. Hofstede’s five cultural dimensions
B. Monochromatic vs polychromatic tune
C. Communication
D. Geography
Answer» D. Geography
48.

NAFTA is an example of

A. Common Market
B. Customers Union
C. Economic Community
D. Free Trade Area
Answer» D. Free Trade Area
49.

Which one is not an international organization

A. SAARC
B. ASEM
C. ASEAN
D. CBDT
Answer» D. CBDT
50.

Which of the following is not an International Financial Institution

A. ICICI
B. IMF
C. IDA
D. World Bank
Answer» A. ICICI
51.

What one of the following is not the advantage of MNCs to the host country

A. Increase in social activities
B. increase in economic activities
C. Utilisation of natural resource
D. R&D efforts enhanced.
Answer» A. Increase in social activities
52.

In terms of the PESTLE analysis, the liberalizing of international trade and tariff regimes could go in which section or sections?

A. Political
B. Legal
C. Political and economic and legal
D. Political and environmental
Answer» D. Political and environmental
53.

An 'industry recipe' can be defined as:

A. An accepted pattern of operating and competing
B. A tactic for anticipating a competitor's next move
C. The hidden competences that are difficult to imitate
D. A strategic group
Answer» C. The hidden competences that are difficult to imitate
54.

Typically, profits are highest in which stage of the industry life-cycle?

A. Introduction
B. Growth
C. Maturity
D. Decline
Answer» B. Growth
55.

The corporate culture of a firm is more effectively carried to the managers who are

A. Host country nationals
B. Home country nationals
C. Third country nationals
D. none
Answer» B. Home country nationals
56.

Posting of home country nationals for all key management positions throughout the globe is supported by:

A. Geocentric staffing model.
B. Polycentric staffing model.
C. Ethnocentric staffing model.
D. none
Answer» C. Ethnocentric staffing model.
57.

Which of the following is NOT a business opportunity generated by globalization?

A. Access to low cost labour.
B. Cheap International transport.
C. Currency crises.
D. Less stringent regulation of the business environment.
Answer» C. Currency crises.
58.

The interpersonal norms of a country may necessitate a company’s alteration of __?

A. Child Labor
B. Operations
C. Accounting
D. None of the above
Answer» B. Operations
59.

Which of the following terms are not synonymous with the others?

A. MNE
B. MNC
C. MNM
D. TNC
Answer» C. MNM
60.

Foreign sources may give companies?

A. Higher costs
B. New and/or better products
C. Conflicting operating knowledge
D. Legal problems
Answer» B. New and/or better products
61.

A major operating objective that may induce companies to engage in international business is _____?

A. To expand sales
B. To maximize risk
C. To acquire competitors
D. None of the above
Answer» A. To expand sales
62.

Critics of globalization claim _______?

A. Countries lose sovereignty
B. The resultant growth hurts the environment
C. Some people lose in both aspects
D. All of the above
Answer» D. All of the above
63.

All of the following are objectives of international business operations except for:

A. sales expansion
B. resource acquisition
C. locally expanding
D. risk minimization
Answer» C. locally expanding
64.

Globalization consists of the following processes except:

A. political process
B. environmental process
C. social process
D. economic process
Answer» B. environmental process
65.

Which of the following is a criticism of globalization?

A. going into someone’s country uninvited
B. different climates in other countries get in the way
C. terrorist opportunities
D. threat to national sovereignty
Answer» D. threat to national sovereignty
66.

To minimize your risk you can:

A. diversify suppliers across countries
B. take advantage of business cycle differences amongst countries
C. a & b
D. none of the above
Answer» C. a & b
67.

Which of the following does not support globalization?

A. Improvements in communications
B. Barriers to trade and investment
C. Immigration controls
D. Removal of controls on movement of capital across borders
Answer» C. Immigration controls
68.

The gains from two nations depend on

A. Domestic barter rates
B. Different in the domestic barter rates of the two countries
C. Terms of trade
D. Degree of absolute advantage.
Answer» C. Terms of trade
Chapter: Unit 2
69.

Which of the following statements is not true when describing a successful strategy?

A. It provides some property that is unique or distinctive
B. It provides the means for renewing competitive advantage
C. It addresses changes in the external environment
D. It guarantees long term survival
Answer» B. It provides the means for renewing competitive advantage
70.

In the context of strategic management resources can be defined as:

A. The knowledge and skills within the organization
B. Something that an organization owns or controls that cannot be copied
C. Something that an organization owns, controls or has access to on a semipermanent basis
D. The physical assets of the organization
Answer» D. The physical assets of the organization
71.

In the context of strategic management, stakeholders can be defined as:

A. An individual or group with a financial stake in the organization
B. An external individual or group that is able to impose constraints on the organization
C. Internal groups or individuals that are able to influence strategic direction of the organization
D. An individual or group with an interest in the organization's activities and who seeks to influence them
Answer» C. Internal groups or individuals that are able to influence strategic direction of the organization
72.

In the case where an organization acquires its supplier, this is an example of:

A. Horizontal integration
B. Forwards vertical integration
C. Backwards vertical integration
D. Downstream vertical integration
Answer» D. Downstream vertical integration
73.

When a firm seeks the benefits of global integration and local adaptation, it is best described as which type of strategy?

A. Transnational
B. Global
C. Multi-national
D. Global-local
Answer» C. Multi-national
74.

Knowledge which is difficult to define and codify is known as:

A. Explicit
B. Tangible
C. Tacit
D. Random
Answer» A. Explicit
75.

Competitive advantage based on the creation of opportunities using internal resources is characterized by which approach/view?

A. The positioning approach
B. The outside-in approach
C. The resource-based view
D. The knowledge-management approach
Answer» C. The resource-based view
76.

'Reputation' in the context of an organization's resources can provide competitive advantage because:

A. It is difficult to copy
B. It is based on word-of-mouth
C. It is a threshold resource
D. It is explicit
Answer» A. It is difficult to copy
77.

A strategic manager that seeks to reach acceptable profit targets as opposed to making as much profit as possible is making decisions of which type?

A. Satisfactory
B. Satisficing
C. Irrational
D. Optimal
Answer» A. Satisfactory
78.

A strategic decision can be distinguished from other types of decisions by three factors, these are magnitude, time-scale and:

A. Commitment
B. Riskiness
C. Impact
D. Longevity
Answer» B. Riskiness
79.

'Logical incrementalism' can be described as:

A. Careful design and planning
B. Emergent
C. Cautious resource allocation
D. Top management rational analysis
Answer» D. Top management rational analysis
80.

An organization in which strategy development is characterized by internal political negotiation and self-interest is operating in which strategy-making mode?

A. The transactive mode
B. The muddling through mode
C. The command mode
D. The emotional mode
Answer» C. The command mode
81.

'Influence' is defined as the ability to ____________ someone to something they would not otherwise have done.

A. Intimidate
B. Force
C. Order
D. Persuade
Answer» A. Intimidate
82.

McDonalds is deciding whether to expand into manufacturing kitchen equipment in China. At what level is this decision likely to be made?

A. Business
B. Corporate
C. Functional
D. International
Answer» A. Business
83.

The authors believe there are three tests that can be applied to judge whether a strategy is 'good'. These are:

A. Fit, distinctiveness, sustainability
B. Fit, internal resources, external environment
C. Distinctiveness, internal resources, fit
D. Sustainability, distinctiveness, external environment
Answer» B. Fit, internal resources, external environment
84.

Diversification into many unrelated areas is an example of:

A. Risk management
B. Good management
C. Uncertainty reduction
D. Sustainability
Answer» C. Uncertainty reduction
85.

According to Porter, dealing with the paradox of premature commitment versus not enough commitment involves some kind of:

A. Trade-off
B. Lock-in
C. Lock-out
D. Diversification
Answer» C. Lock-out
86.

Corporate governance is concerned with:

A. Executive remuneration, disclosure of information, auditing and accounting procedures, and organizations' management structures
B. Elections to the board of directors
C. Relationships with national governments
D. Corporate-level strategy
Answer» C. Relationships with national governments
87.

The principal-agent problem is concerned with:

A. Procurement
B. Appropriation of shareholders' investment by a firm's managers
C. How to control a firm's distributors and dealers
D. Corporate social responsibility
Answer» D. Corporate social responsibility
88.

Which of the following industries is least likely to follow the conventional life-cycle model?

A. Software development
B. Coal mining
C. Insurance broking
D. Hairdressing
Answer» A. Software development
89.

Brandenburger and Nalebuff added a sixth force to Porter's Five Forces. It is known as:

A. The threat of substitutes
B. The power of complementors
C. Seller power
D. Government regulation
Answer» A. The threat of substitutes
90.

The Six Forces framework is based on the principle of:

A. Resource-based view
B. Conduct - structure - performance
C. Econometrics
D. Structure - conduct – performance
Answer» A. Resource-based view
91.

In the Six Forces, the 'threat of new entrants' relates to:

A. Barriers to entry
B. Substitutes
C. Switching costs
D. Buyer power
Answer» D. Buyer power
92.

An industry characterized by irregular patterns of stability, rapid technological change, high uncertainty and global competition can be described as:

A. Hypercompetitive
B. Hyperactive
C. Atypical
D. Co-optive
Answer» D. Co-optive
93.

A situation in which the joint moves of two firms can determine how much money each firm can make or lose can be explained using the story of:

A. The Trojan Horse
B. The Icarus Paradox
C. The Prisoner's Dilemma
D. The Icarus Dilemma
Answer» D. The Icarus Dilemma
94.

In the context of environmental analysis, 'munificence' means:

A. The extent to which resources are freely available to support firms in an industry and enable them to grow
B. The extent to which it is diverse
C. The extent to which it is stable or turbulent
D. The extent to which the industry follows the conventional life-cycle stages
Answer» C. The extent to which it is stable or turbulent
95.

A 'market driven' firm will typically:

A. Develop new products and then find someone to sell them to
B. Define the target market and produce products that will satisfy those customers' needs
C. Operate in a product-oriented fashion
D. Suffer from market-myopia
Answer» B. Define the target market and produce products that will satisfy those customers' needs
96.

Segmentation is a way of:

A. Subdividing markets
B. Subdividing industries
C. Differentiating products
D. Subdividing organizations into departments
Answer» A. Subdividing markets
97.

A B2C market is:

A. Business to commercial
B. Business to consumer
C. Business to contract
D. Business to corporate
Answer» D. Business to corporate
98.

Segmentation is a compromise between two ideals: mass marketing and:

A. Customization
B. Uniformity
C. Innovation
D. Convergence of tastes
Answer» B. Uniformity
99.

Porter's generic strategies are:

A. Low price, differentiation, focus
B. Cost leadership, differentiation, cost focus, focus differentiation
C. Price leadership, differentiation, focus
D. Low cost, differentiation, focus differentiation
Answer» B. Cost leadership, differentiation, cost focus, focus differentiation
100.

According to Porter, if an organization does not follow either a cost leadership strategy or a differentiation strategy they are:

A. Hybrid
B. Stuck in the middle
C. Typical
D. No frills
Answer» C. Typical
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