Professional Documents
Culture Documents
Many of these questions will lend themselves to feedback discussion in the classroom, which students will find
helpful in understanding the concepts and issues. The instruction to students specifies that they should choose
the ‘best’ answer to each question. Some questions are simple and straightforward, but others are more
challenging. Often, more than one choice might seem right, but in each case, there is one best choice. In
feedback discussion, it will aid learning to look at individual questions to see why one answer is better than
the others.
The following is a list of some of the more challenging questions which might lend themselves to deeper
discussion:
Chapter 1 Questions 4, 5, 6
Chapter 2 Questions 2, 4, 8, 9
Chapter 3 Questions 3, 5, 9-11, 14, 15
Chapter 4 Questions 3, 5, 8, 12
Chapter 5 Questions 5, 6, 8-10
Chapter 6 Questions 5-8, 10
Chapter 7 Questions 7, 8, 13, 14, 17
Chapter 8 Questions 1, 4, 8, 9, 12
Chapter 9 Questions 5-8
Chapter 10 Questions 1, 2, 4, 11
Chapter 11 Questions 4, 6-8, 10 12
Chapter 12 Questions 1, 4, 5, 7, 10, 12
Chapter 13 Questions 1, 3, 4, 6-10
The questions
Instruction for students:
For each question, there are four possible answers. Choose the one which is the best answer to each question.
2
(Chapter 1)
2. In the following list of ways by which governments exert control over businesses, which one is out of
place?
a. Full ownership of a company
b. Partial stake in a public company
c. Privatization of a nationalized company
d. Sovereign wealth fund
Answer: c. See pp 18-19.
4. Over which of the following does the MNE parent company have most control?
a. An affiliate company
b. A strategic partner
c. A subsidiary in which it owns 60% of the shares
d. A wholly-owned subsidiary
Answer: d. See p. 17.
7. Which of the following is the least appropriate in describing the ethnocentric organization?
a. The corporate culture is one of confidence in what the firm stands for.
b. The staff share corporate values.
3
11. Elements of HRM as a business function include all but which one of the following?
a. Motivating the workforce
b. Management of rewards
c. Training and development
d. Overseeing quality management
Answer: d. See page 24.
4
(Chapter 2)
4 Which of the following is a push factor which would influence a company to internationalize?
a. Difficulty in finding skilled staff in the home country
b. The need to be close to key resources
c. Low-cost labour in other countries
d. Financial incentives from governments in emerging markets
Answer: a. See p. 49.
(Chapter 3)
2 Purchasing power parity (PPP) is used in conjunction with GNI and GNP as it more accurately reflects:
a. The relative living standards in different countries.
b. The earnings of consumers in different countries.
c. The level of development of different countries.
d. The personal wealth of individuals in different countries.
Answer: a. See p. 82.
3 Strong economic growth is associated with all but which one of the following:
a. Rising standards of living
b. Industrialization
c. Sustainable development
d. Strong capital investment
Answer: c. See p. 83.
4 The short term fluctuations of the business cycle are divided into four phases that are:
a. Expansion, Recession, Depression, Development
b. Maturity, Decline, Depression, Regeneration
c. Prosperity, Decline, Depression, Recovery
d. Prosperity, Recession, Depression, Recovery
Answer: d. See pp 83-4.
c. The merchandise trade account and service account plus the profits and interest earned from
overseas assets.
d. Transactions involving the sale and purchase of assets.
Answer: c. See pp 88-9.
(Chapter 4)
2 Porter’s diamond theory focuses on all but which one of the following?
a. Factor conditions
b. Location advantages
c. Firm strategy and structure
d. Government policies
Answer: b. See pp 125-6.
4 All but which one of the following are tools of government trade policy?
a. Tariffs
b. Non-tariff barriers
c. Multilateral agreements
d. Import quotas
Answer: c. See pp 132 -3.
8 What is the main reason for the collapse of the Doha round of multilateral negotiations?
a. Unwillingness of the US to open markets to products from developing countries
b. Differing perspectives of developed and developing countries
c. Disagreement over labour and environmental standards
d. The activities of anti-globalization protesters
Answer: b. See pp 139-40.
(Chapter 5)
1 Organisational structures can be divided into the following three broad categories:
a. Large, medium, small.
b. Structures based on functions, divisions and matrix
c. Strict hierarchy, board control, devolved control
d. Collective control, co-operative arrangements, shareholder control.
Answer: b. See p. 178.
3 Which of the following are not key players in Porter’s five forces model of competitive strategy?
a. Potential entrants
b. Governments
c. Buyers
d. Suppliers
Answer: b. See pp 160-1.
6 How does stakeholder management theory contribute to value creation for the firm?
a. By serving customers better
b. By helping managers to focus on divergent stakeholder groups
c. By interacting more with employees
d. By developing better communications with suppliers
Answer: b. See pp 164-5.
10 Fordism was characterized by all but one of the following features. Which one is out of place?
a. Vertically integrated system
b. Bureaucracy
c. Adaptability to consumer needs
d. Poor industrial relations
Answer: c. See p. 183.
(Chapter 6)
4 Applying Hofstede’s cultural dimensions, which of the following combines high power distance and
collectivism?
a. American society
b. Asian societies
c. European societies
d. Scandinavian societies
Answer: b. See pp 207-8.
6 Characteristics of organizational culture include all but which one of the following?
a. Common language, terminology and norms of behaviour
b. Preference for formal or informal communication
c. Sustainability policies
d. Rulebook of do’s and don’ts for staff
Answer: c. See p. 210.
10 Which of the following is not one of the challenges associated with ageing societies?
a. Costs of pensions and healthcare
b. Need for managers to accommodate older workers
c. Need for governments to raise the legal pension age
d. Equal opportunities for all ethnic and religious minorities
Answer: d. See pp 219-20.
15
(Chapter 7)
1 The sphere in which citizens pursue their own goals in voluntary associations is known as:
a. The public sphere
b. Civil society
c. The corporate sphere
d. The political sphere
Answer: b. See p. 230
5 The rule of law encompasses all but which one of the following?
a. Equality of citizens under the law
b. An elected president
c. Constitutionalism
d. Independent judiciary
Answer: b. See pp 233-4.
13 How does the parliamentary system differ from the presidential one?
a. The president is always directly elected by the people.
b. The prime minister is usually the head of the party winning the most votes in parliamentary
elections.
c. The president has more power than the prime minister.
d. The prime minister has more power than the president.
Answer: b. (Presidents can be indirectly elected, as in the US) See pp 246-7.
15 Which of the following is not likely to be a priority for a leftwing political party?
17
a. Social justice
b. Big business
c. Equality of opportunity
d. Protection of the environment
Answer: b. See p. 252.
17 The European Union (EU) has traditionally subscribed to which of the following principles?
a. Federalism
b. Pooling of sovereignty
c. Parliamentary sovereignty
d. Executive supremacy
Answer: b. See p. 255.
(Chapter 8)
1 Which of the following has the most direct impact on business operations?
a. International law
b. EU law
c. National legal systems
d. Religious law
Answer: c. See p. 266.
11 Arbitration is:
a. The settling of a contractual dispute
b. An out-of-court settlement
c. The submission of a dispute to a named person or organization
d. Agreed damages
Answer: c. See pages 285-286.
12 The growth in international law stems from all but which one of the following?
a. Concern over the natural environment
b. Concerns over regional conflicts
c. Concerns over human rights
d. Concerns over national courts having too much power
Answer: d. See p. 289.
20
(Chapter 9)
1 Which of these countries has seen the biggest recent surge in IPOs?
a. The US
b. India
c. China
d. The UK
Answer: c. See p. 304-5.
5 Which of the following was the least significant factor in causing the financial crisis of 2008?
a. Crash of US property market
b. The market in mortgage-backed securities
c. Abundant cheap loans
d. The US trade deficit
Answer: d. See pp 308-10.
6 The Bretton Woods agreement was notable for which of the following?
a. The creation of the gold standard
b. Exchange rates pegged to the US dollar
c. The creation of the WTO
d. The abandonment of the gold standard
Answer: b. See pages 316-7.
8 Why has the IMF been criticized for its handling of the Asian financial crisis?
a. Because it proposed required public spending in affected countries
b. Because it was made up of outsiders
c. Because it proposed austerity programmes for affected governments
d. Because it adopted a one-size-fits-all approach to market-oriented reforms in affected countries
Answer: d. See pages 319 to320.
(Chapter 10)
1 Innovation involves:
a. A broad range of improvements across a firm’s operations
b. Scientific and technical research and new product development
c. New ways of marketing the firm’s products
d. Making decisions about new corporate strategy.
Answer: a. See p. 335.
2 An invention is:
a. Anything that is new that changes the way we view the world or live.
b. A product or process that is new and represents a leap forward from existing knowledge
c. Any change in the way we live, learn or work
d. A type of innovation
Answer: b. See p. 335.
3 Schumpeter’s notion of ‘creative destruction’ covers all but which one of the following?
a. New products
b. New ways of doing things
c. New organizational forms
d. New cultural values
Answer: d. See pp 357-8.
5 In which of the following are science and technology graduates the highest proportion of graduates?
a. The EU
b. The US
c. China
Answer: c. See pp 340-1.
6 Which of the following countries spends the most on R&D as a percentage of GDP?
a. South Korea
b. Sweden
c. China
d. Russia
Answer: b. See p. 342.
a. It gives exclusive right for a limited period to exploit the invention or license others to use it.
b. It gives exclusive right to exploit the invention indefinitely.
c. It gives exclusive right to generate profits (royalties) from the invention.
d. It gives the inventor exclusive rights over his/her invention.
Answer: a. See pp 346-7.
9 Which country makes the most applications under the Patent Co-operation Treaty (PCT) process?
a. The US
b. China
c. Japan
d. Germany
Answer: c. See p. 347.
10 The post-war period has seen the emergence of 4 main channels of technology transfer, which are:
a. Direct sale, renting, leasing or licensing,
b. Forming an alliance, partnership, management contract or investment.
c. Franchising, capital goods trade or contract manufacture.
d. FDI, joint venture and strategic alliances, licensing and trade in capital goods
Answer: d. See pages 351-3.
12 Which of the world’s regions had the largest number of internet users in 2009?
a. Latin America
b. Europe
c. Asia
d. North America
Answer: c. See p. 356.
24
(Chapter 11)
8 All but one of the following are principles of the Rio Declaration on Environment and Development. Which
is the odd one out?
a. Governments should bear the costs of cleaning up all pollution.
b. States should eliminate unsustainable patterns of production.
c. States have a sovereign right to exploit their resources.
d. Peace, development and sustainability are linked.
Answer: a. See pp 178-9.
(Chapter 12)
3 Ethical business behaviour includes all by one of the following. Which is the odd one out?
a. Be truthful in advertising.
b. Strive above all to maximize profits.
c. Always abide by the law.
d. Observe high standards of health and safety despite the cost considerations.
Answer: b. See p. 398.
8 What is the main weakness of voluntary codes of practice on ethical and environmental standards?
a. They are just public relations exercises.
b. They are often linked to NGOs.
c. They are only adopted by a minority of firms.
d. Stakeholders cannot be assured that they are carried through in practice.
Answer: d. See p. 404.
9 The ILO Declaration on MNEs and Social Policy contains all but which one of the following?
a. The need for training for workers
b. The supremacy of international law over national law
c. Freedom of association
d. Elimination of child labour
Answer: b. See p. 405.
10 All but which one of the following corporate governance practices can be criticized on CSR grounds?
a. Excessive executive pay
b. Weak rights of minority shareholders
c. Separating the positions of chairman and CEO
d. Poor oversight of executives by the board
Answer: c. (Separation is seen as supporting better accountability.) See pp 407-9.
12 Millennium Development Goals (MDGs) include all but which one of the following?
a. Promote democratic government
b. Combat poverty
c. Improve education
d. Promote environmental sustainability
Answer: a. See pp 414-5.
28
(Chapter 13)
Note: As this is a summary chapter, these questions are more like revision questions than those given for other
chapters. These questions therefore do not strictly follow the content of this chapter.
1 From the viewpoint of the foreign investor, which of the following is a disadvantage associated with
developing countries?
a. Poorly skilled workers
b. Weak protection of intellectual property
c. Small consumer markets
d. Slow economic growth
Answer: b. See pp 428-9.
2 Which of the following regions has the worst problems of poor urban living conditions?
a. Latin America
b. South East Asia
c. South Asia
d. Sub-Saharan Africa
Answer: d. See p. 433.
5 Which of the following risks are particularly associated with financial markets?
a. Labour unrest
b. Ethnic divisions
c. Climate change
d. Currency fluctuations
Answer: d. See p. 435.
6 All but one the following aspects of CSR are particularly relevant for doing business in developing
countries. Which is the odd one out?
a. Respect for IP rights
b. Health and safety standards in manufacturing
c. Corporate governance
d. Human rights
Answer: c. See pp 439-40.
7 For western MNEs, emerging markets present which of the following challenges?
a. Stiff competition from local companies
b. Lack of familiarity with western brands
29
8 Which of the following demands on government is more likely to be felt in developed countries than in
developing ones?
a. Environmental protection
b. Education and training
c. Food security
d. Healthcare and pensions provision
Answer: d. (Mainly a big issue for developed countries with ageing populations) See pp 442-3.
9 All but which one of the following are factors which could have a negative impact on China’s continued
economic growth?
a. Fall in consumer spending
b. Rising costs of energy and raw materials in global markets
c. Lack of R&D expertise
d. Wage demands by China’s factory workers
Answer: c. See pp 443-5. See also Chapter 10. China is rapidly building R&D expertise.