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MGT361: Chapter 8 Mode of Entry

Total questions: 13

Worksheet time: 6mins

Name
Class
Date
1.

What is the first step in selecting a foreign market?

a)

assessing market potential

b)

monitoring major markets

c)

evaluating host country's trade policies

d)

assessing general legal and political environments

2.

________ are those factors that affect the desirability of host country production relative to home country production.

a)

Ownership advantages

b)

Location advantages

c)

National competitive advantages

d)

Internalization advantages

3.

Toyota's efficient manufacturing techniques and reputation for producing high-quality automobiles are examples of ________.

a)

location advantages

b)

ownership advantages

c)

internalization advantages

d)

operational advantages

4.

When deciding which mode of entry to use, a firm must consider things like ownership advantages, location advantages, and internalization advantages.

a)

True

b)

False

5.

________ is the most common form of international business activity.

a)

Exporting

b)

Licensing

c)

Greenfield strategy

d)

Management contract

6.

________ for exporting are those that push a firm into foreign markets.

a)

Reactive motivations

b)

Proactive motivations

c)

Opportunity motivations

d)

Avoidance motivations

7.

Franklin Carpets engages in indirect exporting, so the firm sells its carpets to a(n) ________.

a)

domestic customer who then sells the carpets to a foreign customer

b)

foreign customer who then sells the carpets to a domestic customer

c)

affiliated company located in a foreign country

d)

foreign customer through e-commerce

8.

When British Petroleum ships crude oil from its storage facilities in Kuwait to its Australian subsidiary, ________ has occurred.

a)

indirect exporting

b)

direct exporting

c)

an intracorporate transfer

d)

an intercorporate transfer

9.

What are the third parties that specialize in facilitating imports and exports called?

a)

intermediaries

b)

wholesalers

c)

exporters

d)

distributors

10.

Kodak focuses on developing photo editing software, and the firm has agreements with a Chinese manufacturer to assemble most Kodak cameras. Which entry mode for international business is used by Kodak?

a)

management contracting

b)

international franchising

c)

contract manufacturing

d)

international licensing

11.

When two or more firms agree to work together and create a joint owned firm to promote mutual interest, ________ has occurred.

a)

an acquisition

b)

a joint venture

c)

a licensing agreement

d)

a franchise agreement

12.

One disadvantage of exporting is the logistical complexities.

a)

True

b)

False

13.

Ownership advantages are always tangible or intangible resources owned by a firm that grant it a competitive advantage over its industry rivals.

a)

True

b)

False