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The ability of a multinational or global competitor to shift production from country to country to take advantage of exchange rate fluctuations, energy costs, wage rates, or changes in tariffs is an example of


A) a profit sanctuary.
B) cross-border coordination.
C) an international strategic alliance.
D) cross-market subsidization.
E) cross-market differences in cultural, demographic, and market conditions.

F) A) and E)
G) A) and C)

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Acquisition of an existing firm rather than going de novo may be the least risky and cost-efficient means of overcoming entry barriers such as


A) gaining access to local distribution networks, building supplier networks, and establishing working relationships with key government officials.
B) moving directly to the task of transferring resources and personnel, integrating and redirecting activities into its own operation.
C) putting its own strategy into place.
D) accelerating efforts to build a strong market presence.
E) All of these.

F) A) and B)
G) None of the above

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In which of the following circumstances is it not advantageous for a multinational competitor to concentrate its activities in a limited number of locations in order to build competitive advantage?


A) When the costs of performing certain value chain activities are significantly lower in certain geographic locations than in others
B) When a company has competitively superior patented technology that it can license to foreign partners
C) When there is a steep learning or experience curve associated with performing an activity in a single location
D) When certain locations have superior resources, allow better coordination of related activities, or offer other valuable advantages
E) When there are significant scale economies in performing the activity

F) C) and E)
G) A) and E)

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One of the biggest strategic challenges to competing in the international arena include


A) how to avoid the risks of shifting exchange rates.
B) whether to charge the same price in all country markets.
C) how many foreign firms to license to produce and distribute the company's products.
D) whether to offer a mostly standardized product worldwide or whether to customize the company's offerings in each different country market to match the tastes and preferences of local buyers.
E) whether to pursue a global strategy or an international strategy.

F) A) and D)
G) B) and D)

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One of the most viable strategic options companies should consider in tailoring their strategy to fit circumstances of emerging country markets includes


A) try to change the local market to better match the way the company does business elsewhere.
B) be prepared to modify aspects of the company's business model to accommodate local circumstances.
C) prepare to compete on the basis of low price.
D) stay away from those emerging markets where it is impractical to modify the company's business model to accommodate local circumstances.
E) All of these.

F) None of the above
G) A) and E)

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Dispersing particular value chain activities across many countries rather than concentrating them in a select few countries can be more advantageous when


A) buyer-related activities (such as sales, advertising, after-sale service and technical assistance) need to take place close to buyers.
B) high transportation costs make it uneconomical to operate from one or just a few locations.
C) it helps hedge against the risks of exchange rate fluctuations, supply disruptions, and adverse political developments.
D) there are diseconomies of scale in trying to operate from a single location.
E) All of these.

F) All of the above
G) A) and E)

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A "think local, act local" multidomestic strategy works particularly well when


A) host governments enact regulations requiring that products sold locally meet strictly defined manufacturing specifications or performance standards.
B) there are significant country-to-country differences in customer preferences and buying habits.
C) diverse and complicated trade restrictions of host governments preclude the use of a uniform strategy from country to country.
D) there are significant country-to-country differences in distribution channels and marketing methods.
E) All of the above.

F) A) and B)
G) None of the above

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Cross-border coordination contributes to a competitive advantage for a global competitor by


A) allowing production to be shifted from country to country to take advantage of exchange rate fluctuations, energy costs, wage rates, or changes in tariffs and quotas.
B) allowing knowledge gained in one location to be transferred to operations in other countries.
C) shifting workloads from where they are unusually heavy to locations were personnel are underutilized.
D) accelerating product development and enhancing innovation by globally linking and coordinating the scattered R&D departments of a multinational company.
E) All of these.

F) C) and D)
G) C) and E)

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