Home and host governments having good relations benefit businesses as good relations may lead to:

More opportunities for governmental cooperation in infrastructural projects

Globalization of production is important to international business. Which of the following is not one of these benefits?

Access new market opportunities by selling overseas if home market is small

Governments intervene in trade. What is NOT some of the possible reasons why governments do so?

Protect dying industries till they can sufficiently compete again.

Which one of the following is NOT a possible consideration in the political environment when investing overseas?

Standard of literacy of the people in the host country

Many international companies have started to venture into Myanmar since its economic reforms. Which is NOT a reason?

Technology and management know-how

Under threat of new entrants, which combination result in low entry barrier and high threat of new entrants?

Friendly government policy and low economies of scale for existing firms

Which of the following is NOT considered as a ‘New Entrant’ for the shoes (footwear) retail industry in Philippines?

Local Filipino fashion footwear chain store planning to open a new outlet.

Which of the following are indicators of an expanding economy and positive consumer optimism of the economy health?

Purchasing Managers’ Index > 100 and Consumer Confidence Index > 50

The industry is considered the least attractive when:

(a) Threat of new entrants is high

Multinational companies that engage in corruption in foreign countries (Host countries):

Incur hidden costs of doing business

Which conditions best define a market economy?

Most of the land, factories & economic resources are privately owned

Globalization of markets is important to international business. Which of the following is not one of these benefits?

Access lower-cost workers to reduce production costs with low-cost labour

Which of the following statement about “Legal environment” of the Political 5 Point Framework is incorrect?

Internet protocol rights refers to if patents are protected in the country

The following are sources of political risks with the exception of:

Population density over the territory of the country

Globalization supporters argue on improving standards of living. Which of the following is NOT one of these arguments?

Cultural integration & reduces the need to customize for different markets.

Under Hofstede’s dimensions, Japan has a masculinity score of 95, this means that:

Employees there feel that work is more important than leisure

Which of the following happenings is NOT an example of risks under political consideration?

Russians have a tough negotiating style and tend not to compromise

Business expanding into the South Korea which has an individualism score of 18 under the Hofstede’s dimension should:

Implement a loyalty programme to appeal to customer’s sense of belonging

Climate Risk Index is used to assess which of the following?

Impact of weather-related loss events such as storms, floods on countries

The HDI is a statistical tool used to measure a country’s overall achievement. It is based on which three measures:

Average income, average lifespan and average education level

Which of the following is NOT a result of increasing inflation?

Decrease in interest rates to stimulate consumers spending.

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Questions 35

Answers

1
In the Michael Porter Model, the degree of competition is NOT dependent on which of the following:
Intensity of rivalry
Bargaining power of buyers
Threat of substitutes
Bargaining power of suppliers
2
Which of the following best describe “people understand and accept their place in the organisation and society”?
Individualism
Power distance
Uncertainty avoidance
Masculinity
3
Home and host governments having good relations benefit businesses as good relations may lead to:
Less friendly trade and investment policies between the 2 countries
More government officials from both countries visiting as tourists
More opportunities for governmental cooperation in infrastructural projects
More investment between both countries and less investment into others
4
Globalization of production is important to international business. Which of the following is not one of these benefits?
Access production inputs which are unavailable or costlier at home.
Access new market opportunities by selling overseas if home market is small
Access lower-cost workers to reduce production costs with low-cost labour.
Access technical expertise which may not be available in the home country.
5
Governments intervene in trade. What is NOT some of the possible reasons why governments do so?
Preserve national security and defence-related issues.
Protect jobs which may be lost to countries with less-expensive labour.
Pursue strategic trade policies such as reaching economies of scale.
Protect dying industries till they can sufficiently compete again.
6
Which one of the following is NOT a possible consideration in the political environment when investing overseas?
Legal environment, specific laws & regulations affecting foreign investors
Social stability in host country due to presence of protests
Standard of literacy of the people in the host country
Foreign government’s participation in global & regional organisations
7
Which of the following is not a type of political risk?
Ownership Risk
Financial Risk
Operational Risk
Transfer Risk
8
Many international companies have started to venture into Myanmar since its economic reforms. Which is NOT a reason?
Large consumer market
Lower labour cost
Technology and management know-how
Availability of raw resources
9
Under threat of new entrants, which combination result in low entry barrier and high threat of new entrants?
Friendly government policy and low economies of scale for existing firms
High product differentiation for firms and flexible government policies
High economies of scale for existing firms and high capital requirement
Low product differentiation for existing firms and high switching cost
10
Which of the following is NOT considered as a ‘New Entrant’ for the shoes (footwear) retail industry in Philippines?
Existing clothing retailer interested to set up shoe stores in Manila.
Charles and Keith who is keen to set up stores in the Philippines.
Local Filipino leather goods company planning to set up shoe stores.
Local Filipino fashion footwear chain store planning to open a new outlet.
11
Which of the following are indicators of an expanding economy and positive consumer optimism of the economy health?
Purchasing Managers’ Index < 100 and Consumer Confidence Index > 50
Purchasing Managers’ Index < 100 and Consumer Confidence Index < 50
Purchasing Managers’ Index > 100 and Consumer Confidence Index > 50
Purchasing Managers’ Index >100 and Consumer Confidence Index < 50
12
The industry is considered the least attractive when:
(c) Threat of substitutes is low
(b) Bargaining power of buyers is low
(a) Threat of new entrants is high
Bargaining power of suplliers is low
13
Multinational companies that engage in corruption in foreign countries (Host countries):
Are always small and medium sized enterprises
Can expand faster in global markets
Incur hidden costs of doing business
Are normally more successful than those that are not engaged in corruption
14
Under the Michael Porter’s Model, which of the following is NOT a substitute for a petrol-driven Japanese-brand car?
A petrol-driven Mercedes car
A Tesla-brand Electric Vehicle
A Toyota-brand Hybrid Vehicle
A Yamaha-brand motorcycle
15
Under the Michael Porter's Model, the bargaining power of buyer is high when:
Buyer has little information
Buyers face high switching cost
The industry product is differentiated
None of the above
16
Which one of the following is a risk considered under “Legal Environment” of the Political 5 Point Framework:
All the three options
Freedom of press in reporting news without government censorship
Complexity in the processes required to start and operate a business
Independence of the court of law to external pressure and influence
17
Which of the following is a Berlin-based organization that produces reports on corruption each year?
Commercial Intelligence Agency (CIA)
Transparency International
Business Ethics Bureau
International Anti-Corruption Agency
18
The industry is considered the most attractive when:
Bargaining power of buyers is high
Threat of new entrants is low
Threat of substitutes is high
Intensity of rivalry is high
19
Which of the following is/are not cultural elements that firms expanding into overseas markets should consider:
Aesthetics
Values
Personality
Language
20
Which conditions best define a market economy?
Most of the land, factories & economic resources are privately owned
Demand and supply is not determined by market forces.
Economic resources are equally split between private and government.
Government controls sectors that it considers important to security.
21
Globalization of markets is important to international business. Which of the following is not one of these benefits?
Levels uneven income flow to reduce big variations in sales between markets
Creates new market opportunities by selling overseas
Access lower-cost workers to reduce production costs with low-cost labour
Reduces marketing costs by standardizing certain marketing activities
22
The Logistics Performance Index (LPI) identify logistics challenges and opportunities . Which is NOT a LPI component?
Ease of arranging shipments
Quality of Logistics services
Skills of current workforce
Customs
23
Under the MP Model, which of the following is NOT a Substitute for a pair of Converse sneakers?
A pair of Skechers sneakers.
A pair of Nike running shoes
A pair of sandals
A pair of leather shoes
24
Which of the following statement about “Legal environment” of the Political 5 Point Framework is incorrect?
Countries with high corruption is always less ideal for doing business
Level of bureaucracy indicates whether it is tedious or easy to do bus
Internet protocol rights refers to if patents are protected in the country
Judiciary Independence assess if courts are free from external influence
25
The following are sources of political risks with the exception of:
Government withdrawing from International Organizations
Population density over the territory of the country
Red tape and extensive bureaucratic procedures for doing business
Frequent changes in government
26
Globalization supporters argue on improving standards of living. Which of the following is NOT one of these arguments?
Generate labour flexibility in developed nations to high demand sectors.
Advancement of economies in developing nations.
Cultural integration & reduces the need to customize for different markets.
Increase in nations' wealth by boosting productivity.
27
Under Hofstede’s dimensions, Japan has a masculinity score of 95, this means that:
People are generally less competitive and achievement oriented
Business should target advertisements for higher value household items
Workplace management style would be more nurturing and relationship-focused
Employees there feel that work is more important than leisure
28
Which economic indicator measures a country's future economic potential?
Corruption Perception Index
Wage Competitiveness Index
Human Development Index
Purchasing Manager Index
29
Which of the following indicator is NOT for measuring “Stability of Government”?
Political Stability and Absence of Violence
Regulatory Quality
Corruption Perception Index
Public Trust in Politicians
30
Which of the following happenings is NOT an example of risks under political consideration?
Thailand demonstrators going against military rule
Russians have a tough negotiating style and tend not to compromise
China imposing the National Security Law on Hong Kong
Myanmar protests against Junta rule
31
Business expanding into the South Korea which has an individualism score of 18 under the Hofstede’s dimension should:
Encourage employees to compete against each other and rewards will
Train employees to provide good customer service and treat their customer
Set individual goals as targets for its employees
Implement a loyalty programme to appeal to customer’s sense of belonging
32
Under the Michael Porter's model, intense competition (rivalry) is reduced when which of the following is present:
Small market size
Product / service of the companies is not well differentiated
Small number of competitors in the industry
High growth in the industry
33
Climate Risk Index is used to assess which of the following?
Impact of weather-related loss events such as storms, floods on countries
Changes in the amount of pollution
Severity of earthquake in a certain location
Relative severity of various types of environmental issues
34
The HDI is a statistical tool used to measure a country’s overall achievement. It is based on which three measures:
Average income, average lifespan and average education level
Average GDP, average healthcare spending and average education level
Average GDP, average lifespan and average education level
Average income, average healthcare spending and average lifespan
35
Which of the following is NOT a result of increasing inflation?
Decrease in interest rates to stimulate consumers spending.
Increase in production cost thus reducing competitiveness of local exports.
Workers demand for increase in wages to counter effects of inflation.
Erosion of consumers' purchasing power.

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