Practice Questions on Ch. 11 – Global Strategy1. A firm’s strategy should seek to maximize the difference between the value the firm produces and the cost of producing it.
True False
2. Firms that invest large amounts of money abroad tend to be less profitable because of the cost of those investments.
True False
3. Firms that pursue a global standardization strategy are essentially following a low-cost strategy on a global scale.
True False
4. International strategy is being followed when a firm customizes its products for international markets and customers, sometimes involving a wide range of new options.
True False
5. Pressures for local responsiveness arise from all of the following EXCEPT:
/ TMLDirect A) / A. ways of cutting production costs./ TMLDirect B) / B. differences in customer tastes and preferences.
/ TMLDirect C) / C. distribution channels.
/ TMLDirect D) / D. host-government demands.
6. A localization strategy seeks to increase profitability by:
marketing local goods instead of imported ones.
B) brokering through strategic alliances with local partners.
C) customizing the firm's products to match local tastes.
D) offering discounts and promotions to match local needs.
7. Firms pursuing a transnational strategy are trying to:
/ TMLDirect A) / actually move away from "brick and mortar" operations.
/ TMLDirect B) / facilitate transborder trade with global partners.
/ TMLDirect C) / maneuver competitors through host government support.
/ TMLDirect D) / achieve low costs through location economies while also customizing product for local tastes.
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Answers: 1) True. 2) False. 3) True. 4) False. 5) A. 6) C. 7) D.