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BSG Final Exam Questions and Answers
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BSG Final Exam Questions and Answers
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BSG Final ExamMany companies acquire a local business as a means of entering foreign markets because - Answer-
acquisition is quicker than creating a new subsidiary and building its entire operations from the ground
up, and it may be the least risky and cost-efficient means of hurdling entry barriers.
Which of the following account for why companies decide to enter foreign markets? - Answer-To gain
access to new customers and/or achieve lower costs and thereby become more cost competitive
Because buyer tastes for a particular product or service sometimes differ substantially from country to
country, - Answer-companies operating in a global marketplace must wrestle with whether and how
much to customize their offerings in each different country market to match the tastes and preferences
of local buyers or whether to pursue a strategy of offering a mostly standardized product worldwide
The advantages of using a franchising strategy to pursue opportunities in foreign markets include -
Answer-having franchisees bear most of the costs and risks of establishing foreign locations and
requiring the franchiser to expand only the resources to recruit, train, support, and monitor foreign
franchisees.
A company is said to be engaging in "cross market. subsidization" when - Answer-it supports a
competitive offensive in one market with resources, capabilities, and profits (cash flows) diverted from
operations in other country markets.
,Which of the following is not among the various strategic ways a company can establish a competitive
presence in foreign markets? - Answer-A profit sanctuary strategy
Which of the following statements regarding global competition is false? - Answer-In global
competition, there's more cross-country variation in industry conditions and competitive forces than
there is in industries where multicountry competition prevails.
In which one of the following instances is it not advantageous to concentrate a company's activities in a
few locations? - Answer-When the company is striving to build profit sanctuaries in more than five
different countries
Profit Sanctuaries - Answer-are country markets (or geographic regions) in which a company derives
substantial profits because of its strong or protected market position
Based on the content of Figure 7.2, which of the following is the most unlikely element of a localized
multicountry strategy - Answer-Using the best suppliers from anywhere in the world
Domestic companies facing competitive pressure from lower-cost imports - Answer-benefit when their
government's currency declines in value relative to the currencies of the countries where the lower cost
foreign imports are being manufactured
According to Figure 7.2, which of the following does not accurately characterize the differences between
a localized multicountry strategy and a global strategy? - Answer-A global strategy involves striving to
be the global low-cost provider by economically producing and marketing a mostly standardized product
worldwide whereas a multicountry strategy entails pursuing broad differentiation and striving to
strongly differentiate its products in one country from the products it sells in other countries.
A firm pursuing a "think global, act local" approach to strategy-making - Answer-pursues a competitive
strategy that is essentially the same in all country markets where it operates but it may nonetheless give
local managers room to make minor variations where necessary to better satisfy local buyers and to
better match local market conditions.
, Which one of the following is among the important strategic issues associated with competing across
national boundaries? - Answer-Whether to employ essentially the same basic competitive strategy in all
countries or modify the strategy country by country to better match local market and competitive
conditions
Competing in one or more countries or regions of the world causes strategy-making to be more complex
partly because of - Answer-sizable cross-country differences in wage rates, worker productivity,
inflation rates, energy supplies and costs, tax rates, and other factors that impact a company's costs and
profit prospects.
Which one of the following is not a reason why a company decides to enter foreign markets? - Answer-
To build the profit sanctuaries necessary to wage guerilla offensives against global challengers
endeavoring to invade the company's home market
Competing in one or more countries or regions of the world causes strategy-making to be more complex
because of - Answer-the risks of adverse shifts in currency exchange rates and the presence of
important cross-country differences in buyer tastes, market sizes, and growth potential.
According to Figure 7.2, which one of the following is not a common trait of a global strategy? - Answer-
Design manufacturing plants to cost-effectively produce many different product versions
Which of the following is not one of the strategic ways a company can establish a competitive presence
in foreign markets? - Answer-Using the creation of profit sanctuaries as the primary vehicle for entering
foreign markets
Because there are country-country differences in buyer tastes, income levels, distribution channels,
competitive conditions, and other market-related factors that impact a company's strategy choices, -
Answer-one of the managerial challenges at companies with international or global operations is how
best to tailor a company's strategy to take all these cross-country differences into account.
Which of the following is the most unlikely element of a "think global, act global" approach to crafting a
global strategy? - Answer-Having relatively small plants in many countries, with each plant producing
product versions for local area markets
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