Chapter: Multinational Enterprises
1.

A multinational is a firm that controls and manages production facilities in

A. both developed and developing countries
B. at least two countries
C. one country but relies on multiple markets for the consumption of goods it produces
D. at least two developed countries and one developing country
Answer» B. at least two countries
2.

Locational advantages are based on which combination of the following specific country characteristics

A. a large reserve of natural resources, a large local market and efficiency opportunities
B. a small reserve of natural resources, a large local market and efficiency opportunities
C. a small reserve of natural resources, a small local market and efficiency opportunities
D. a large reserve of natural resources, a small local market and efficiency opportunities
Answer» A. a large reserve of natural resources, a large local market and efficiency opportunities
3.

Horizontal integration occurs when

A. firm creates singular country production facilities, each of which produces different good or goods
B. firm creates multiple production facilities, each of which produces the same good or goods.
C. firm creates multiple production facilities, each of which produces different good or goods
D. firm creates singular country facilities, each of which produces the same good or goods
Answer» B. firm creates multiple production facilities, each of which produces the same good or goods.
4.

Which of the following would be an example of foreign direct investment from the United States to Taiwan?

A. a u.s. bank buys bonds issued by a taiwan computer manufacturer.
B. a u.s. car manufacturer enters into a contract with a taiwan firm to make and sell it spark plugs.
C. microsoft hires a taiwanese computer programmer to debug some software for it.
D. the state of california rents space in taipei for one of its employees to use promoting tourism in
Answer» B. a u.s. car manufacturer enters into a contract with a taiwan firm to make and sell it spark plugs.
5.

If a German manufacturer of household appliances wants to take advantage of the cheaper labor available in the Czech Republic, which of the following actions will not serve that purpose?

A. build a manufacturing subsidiary there and employ czech workers.
B. build a plant in the czech republic and send all german workers to operate it.
C. license a czech firm to produce its products under its own label.
D. contract for a czech firm to do some of the processing for it.
Answer» B. build a plant in the czech republic and send all german workers to operate it.
6.

Which of the following was created in an effort to promote free trade?

A. world trade organization
B. the sarbanes-oxley act
C. multilateral development banks
D. the organization for economic cooperation and development
Answer» A. world trade organization
7.

. Removing barriers or restrictions set by the government is called:

A. liberalisation
B. investment
C. favorable trade
D. free trade
Answer» A. liberalisation
8.

Which is the right sequence of stages of Internationalization

A. domestic, transnational, global, international, multinational
B. domestic, international, multinational, global, transnational
C. domestic, multinational, international, transnational, global
D. domestic, international, transnational, multinational, global
Answer» B. domestic, international, multinational, global, transnational
9.

Subsidiaries consider the regional environment for policy / Strategy formulation is known as

A. polycentric approach
B. regionocentric approach
C. ethnocentric approach
D. geocentric approach
Answer» B. regionocentric approach
10.

. Which is not an Indian Multinational Company?

A. unilever
B. asian paints
C. piramal
D. wipro
Answer» A. unilever
11.

Select example of Indian Multinational Company

A. hindustan unilever
B. videocon
C. cargill
D. tesco
Answer» B. videocon
12.

…………………corporation produces in the home country or in a single country and focuses on marketing these products globally or vice a versa.

A. global
B. international
C. transnational
D. none of the above
Answer» A. global
13.

The —————-company produces, markets, invests and operates across the world

A. global
B. international
C. transnational
D. multinational
Answer» C. transnational
14.

Business across several countries with some decentralization of management decision making to subsidiaries is

A. global business.
B. multinational business.
C. transnational business.
D. multi-regional business.
Answer» B. multinational business.
15.

Immobility of labor among nations is

A. absolute.
B. relatively of a higher degree than among regions in the same country.
C. relatively easier than movement within the country.
D. of the same degree as within the country.
Answer» B. relatively of a higher degree than among regions in the same country.
16.

The following factor does not differentiate international business from domestic business

A. different currencies
B. product quality
C. product mobility
D. trade policies
Answer» B. product quality
17.

By entering into international business, a firm expects improvement in

A. marketing.
B. all spheres of marketing, operation and finance simultaneously.
C. any or all spheres of marketing, operation and finance.
D. finance only
Answer» C. any or all spheres of marketing, operation and finance.
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