Red Bull has gained ________ of the worldwide energy drink market by
skillfully connecting with global youth.
a. 70 percent
b. 80 percent
c. 60 percent
d. 50 percent
e. 90 percent

A. 70%

Red Bull built buzz about the product through its .
a. "buzz marketing program"
b."in program"
c. "marketing program"
d. "seeding program"
e. "advertising campaign

D. "seeding program

A global industry is defined as .
a. an industry in which the strategic positions of competitors are
fundamentally affected by their overall global positions
b. an industry that operates in more than one country and captures
R&D, marketing, and other financial advantages in its costs and reputation.
c.an industry that operates in more than one country and has a
strategic position in many countries
d. a firm that operates in more than one country and has sales and
marketing staff for those countries
e. an industry that has strategic positions in many countries but is
not affected by compeition

A. An industry in which the strategic positions of competitors are
fundamentally affected by their overall global position.

A global firm is one that .
a. where the strategic positions of competitors are fundamentally
affected by their overall global positions
b. operates in more than one country and capture R&D, marketing,
and other financial advantages in its costs and reputation
c. operates in more than one country and has a sales and marketing
staff in those countries
d. operates in more than one country and has a sales and marketing
staff in those countries developing
e.has strategic positions in many countries but is not affected by
competition researching

B. operates in more than one country and captures, R&D,
marketing, and other financial advantages in its costs and reputation.

International trade in 2003 accounted for over of U.S. GDP up from 11
percent in 1970
a. one-third
b. one-eighth
c. one-half
d. one-quarter
e. 18 percent

D. one-quarter

Global firms plan, operate, and their activities on a
worldwide basis.
a. produce
b. coordinate
c. distribute
d. price
e. service

B. coordinate

The major decisions in international marketing include which of the
following steps?
a. deciding whether to go abroad
b. deciding which markets to enter
c. deciding how to enter the market
d. deciding on the marketing program
e. all of the above

e. all of the above

The internationalization process has four stages. These stages are
.
a. no regular export activities
b. export via independent representatives (agents)
c. establishment of one or more sales subsidiaries
d. establishment of production facilities abroad.
e. all are part of the internationalization process

E. all are part of the internationalization process

Most firms work with an
and enter a nearby or similar country.
a. independent agent
b. contractual export department
c. import/export department
d. franchisee
e. management contract

A. independent Agent

A "waterfall: approach to international marketing is defined as:
a. countries that are gradually entered sequentially
b. countries in which the demand for the product is greatest is
entered first
c. countries in which the demand for the product is greatest is
entered last
d. countries in which the supply of race material is greatest is
entered first
e. countries are entered based upon ease of entry

A. countries that are gradually entered sequentially

A "sprinkler" approach to international marketing is
defined as :
a. countries that are entered when timing is right
b. countries that are gradually entered sequentially
c. countries in which the supply of raw material is greatest is
entered first
d. countries in which the demand for the product is greatest is
entered first
e. many countries are entered simultaneously within a limited period
of time

E. many countries are entered simultaneously within a limited period
of time.

The developed nations and the prosperous parts of developing nations
account for less than
of the world's population.
a. 10%
b. 15%
c. 20%
d. 25%
e. 30%

B. 15%

Marketers must change their conventional marketing to sell their
products to developing countries. One of the changes that marketers
can make is to :
a. reduce the price of the product but increase the packaging size
b. reduce the size but keep the pricing the same
c. reduce the price of the product
d. reduce the size and price of the packaging
e. increase the price and packaging size because these countries
have never seen the product before

D. Reduced the size and price of the packaging

Factors that influence the "Attractiveness: of a country to
enter include which of the following?
a. product, geography, income and population, political climate, and
other factors
b. product, geography, income, climate, and source of income
c. population, incomes, competition, and political climate
d. incomes, profit potentials, competitions, and climate
e. incomes, families, competition, and cultural differences

A. product, geography, income and population, political climate, and
other factors.

Regional economic integration is defined as:
a. agreements between individual firms for the sake of commerce
b. trading agreements between individual countries
c. trading agreements between individual firms
d. trading agreements between countries and firms
e. trading agreements between blocs of countries

E. Trading agreements between blocs of countries.

The European Union founded in 1957 added in May 2004 bringing
its total membership to 25 countries.
a. 10 countries
b. 5 countries
c. 20 countries
d. 6 countries
e. 4 countries

A. 10 countries

NAFTA established a free trade zone between what three countries?
a. Canada, Mexico, and South America
b. Canada, Mexico, and Peru
c. Mexico, South America, and the United States
d. Canada, Mexico, and the United States
e. Canada, Mexico, and Japan

D. Canada, Mexico, and the United States

MERCOSUL is a free trade zone linking which of the following South
American countries
a. Mexico, Japan, Brazil, and Paraguay
b. Mexico, Brazil, and Paraguay
c. Brazil, Argentina, and Paraguay
d. Canada, Brazil, and Paraguay
e. Brazil Argentine, Paraguay and Uruguay

E. Brazil, Argentina, Paraguay, and Uruguay

The five modes of entry into foreign markets generally flow by
increasing commitment, risk, control, and profit potential as follows ________.
a. indirect exporting, direct exporting, licensing, joint ventures,
and direct investment
b. direct investment, joint ventures, licensing, direct exporting,
and indirect exporting.
c. direct investment, joint ventures, and licensing
d. direct investment, joint ventures, licensing, and indirect exporting
e. none of the above

A. indirect exporting, direct exporting, licensing, joint ventures,
and direct investment.

In choosing which countries to invest in, companies sometimes choose
psychic proximity to their own country. Psychic proximity can best be
defined as ________.
countries close to the
�host� country in which the company feels comfortable with the
language, laws, and culture countries that �mimic� the host
country in terms of language and culture countries that the
host country�s management team have visited countries close
to the �host� country in which the company feels that they can
infiltrate quickly and profitable countries close to the
�host� country in which the company can easily transport their
products

A. countries close to the "host" country in which the
company feels comfortable with the language, laws, and culture.

The normal way to get involved in an international market is through
exporting. Occasional exporting is defined as ________.
when the company carries
on exporting activities on the behalf of others when the
company makes a commitment to expand into particular markets
when the company works through independent agents when
the company hires domestic-based agents to negotiate foreign
purchases a passive level of involvement in which the company
exports its products from time to time

E. a passive level of involvement in which the company exports its
products from time to time

Active exporting takes place when the company ________ to expand into
a particular market.
forms a �skunk�
group forms an export department hires an agent
makes an effort makes a commitment

E. makes a commitment

Domestic-based export merchants ________.
buy the manufacturer�s
products and then sell them abroad buy the manufacturer�s
products then sell them in the host country buy the
manufacturer�s products then fine agents and customers in foreign
countries seek and negotiate foreign purchases carry
on exporting activities on behalf of several producers

A. buy the manfacturer's products and then sell them abroad

Domestic based export agents perform a valuable service for the
companies seeking to enter foreign markets. The primary function of
these agents is to ________.
carry on exporting
activities on behalf of several producers buy the
manufacturer�s products and then sell them abroad buy the
manufacturer�s products then sell them in the host country
seek and negotiate foreign purchases and are paid a commission
on those sales export products to foreign countries

D. seek and negotiate foreign purchases and are paid a commission on
those sales.

Company�s prefer to enter a country that ranks high on market
attractiveness, low in market risks and ________.
in which it would
possesses a competitive advantage turn a quick profit
able to dominate its foreign competitors through superior
product design and performance gain a dominate market share
within one year of exporting increase its foreign market
share by 50 percent in one year

A. in which it would possesses a competitive advantage

Indirect export has two advantages for the firm. First in involves
less investment for the firm and secondly it ________.
involves less
paperwork involves less intrusion by the government
involves less risk involves less people to manage the
process involves less products and product lines

C. involves less risk

A company can carry on direct exporting in several ways. These
include domestic- based export department or division, overseas sales
branch or subsidiary, traveling export sales representatives, and ________.
foreign-based
distributors or agents marketing departments based in the
foreign country export merchants in foreign countries
export management companies none of the above

A. foreign-based distributors or agents

According to the text, Shaper Image receives more than ________ of
its online business form overseas customers.
15 percent 30
percent 25 percent 40 percent 10
percent

C. 25%

�Going abroad� using the Internet has its challenges. One of the
challenges that a global marketer may run up against when using the
Web are ________.
cultural
restrictions language barriers pricing
procedures monetary exchanges logistical
limitations

A. cultural restrictions

Licensing is a simple way to become involved in international
marketing. In licensing, the licensor issues a license to a foreign
company to use a process, trademark, patent, or trade secret for a(n) ________.
limited period of
time fee or royalty exchange of information or
propriety information exchange for access to the market
place exchange for �their� process, trademark, patent, or
secret

B. fee or royalty

Companies such as Marriott and Hyatt sell a variation of the
licensing agreement called ________ to the owners of foreign hotels to
manage these businesses for them in foreign countries.
contract
manufacturing management contracts franchising
hotel management licensing none of the above

B. management contracts

In ________, the firm hires local manufacturers to produce the
product. This gives the company less control over the manufacturing
process and loss of profits of the manufacturing efficiencies.
contract
manufacturing management contracts licensing
franchising none of the above

A. contract manufacturing

A company can enter a foreign market through ________, which is a
complete form of licensing in which the company offers a complete
brand concept and operating system designed to ensure that the
________ operates according to the requirements of the licensor.
contract
manufactures/licensor contract management/firm
management contracts/firm joint venture/firm
franchising/franchisor

E. franchising/franchisor

The definition of a joint venture company is one ________.
in which foreign
inventors join with local investors where they share ownerships and
control in which two people or more own the firm jointly
where foreign investors join with others to own the firm
where ownership by local and distant investors in share
ownership of a franchise where ownership is by investors of
foreign firms

A. in which foreign inventors join local investors where they share
ownership and control

A joint venture may be necessary or desirable for economic or
political reasons. Additionally, a foreign firm might lack the
________, or managerial resources to undertake the venture alone.
resource,
competency financial, physical financial,
willingness political, financial political,
competency

B. financial, physical

In an adapted marketing mix, the producers� ________ the marketing
program to each target market.
reduce the importance of
each element of the marketing program to adjust for cost
differential between countries decide on which element of
the marketing mix to change/country/target market prior to entering
the country adapt the communications message to the host
country change only one element of the marketing
mix/country adjust

E. adjust

International companies must decide on how much to adapt their
marketing strategy to local conditions. At one extreme are companies
that use a globally standardized marketing mix worldwide. A
standardized marketing mix includes ________.
a concentric strategy
which includes the product, integrated marketing communications mix,
and distribution strategy standardization of the product,
communication, and distribution channels promising lowest
costs. changes only to the product keeping distribution
channels and marketing communications consistent across
countries changing only the distribution channels to
accommodate the host country changes only to the product
and communication message

B. standardization of the product, communication, and distribution
channels promising lowest costs

The ultimate form of foreign involvement is direct ownership of
foreign-based assembly or manufacturing facilities. One of the
advantages of direct ownership can include economies of scale,
creating jobs in the host country, developing deeper relations with
local suppliers etcetera and the firm ________.
retains full control
over its investment reviews global outreach
projections redefines the business concept reviews
the successes from e-commerce receives no disadvantages to
direct investment

A. retains full control over its investment

Hofstede identifies four cultural dimensions that can differentiate
countries. These are individualism versus collectivism, high versus
low power distances, masculine versus feminine, and ________.
customer relationship
management versus power distances strategic management
versus marketing management weak versus strong uncertainty
avoidance total quality management versus JIT deliveries
marketing management versus customer relationships

C. weak versus strong uncertainty avoidance

Straight extension of the product means ________.
introducing the product
to the foreign market without any changes to the product.
introducing the product to the foreign market without major
changes to the product introducing the product to the
foreign market with major changes to the product
introducing the product to the foreign market with no major
marketing program not introducing the product to the
foreign market until changes have been made

A. introducing the product to the foreign market without any changes
to the product.

An advantage of global marketing is that it can lower marketing
costs, has economies of scale in production and distribution, can
produce consistency in brand image, has the ability to leverage good
ideas quickly and efficiently, and ________.
is easier to adapt to
foreign countries allows for the same message to be used
worldwide allows for individual countries to add their
specific needs to the message is easier for corporations to
evaluate the marketing message allows for uniformity of
marketing practices

E. allows for uniformity of marketing practices

Product adaptation involves ________.
altering the product to
meet local conditions or preferences altering the product
to meet minimum acceptable standards changing the product
periodically upgrading the product on a periodic basis
changing the product to meet competition

A. altering the product to meet local conditions or preferences

A firm can successful introduce four versions of its products into a
foreign country or a firm may select one of these for inclusion. These
versions include ________.
customer version,
regional version, and city version customer version,
country version, and retailer version regional version,
country version, city version, and retailer version
customer version, regional version, city version, and retailer
version regional version, country version, city version, and
market versions

C. regional version, country version, city version, and retailer version

Product invention consists of creating something new. Backward
invention is reintroducing earlier product forms that are well adapted
to a foreign country�s needs. Forward invention is ________.
creating a new product
to meet a need in another country creating a new product to
meet the need in the host country understanding the
differences between host and foreign country markets
increasing the control over the development of new products
inventing something that yet has a �market�

A. creating a new product to meet a need in another country

Companies can run the same marketing communications programs as used
in the home market or change them for each local market, a process
called ________.
product
communications brand communications dual
adaptation marketing communications communication
adaptation

E. communication adaption

Many multinationals are plagued by the gray market problem. The gray
market consists of ________.
the marketing of
products to older consumers branded products diverted from
normal distribution channels in the country of product origin
branded products diverted from one country to another
products being repackaged from the intended country to a
diverted country products not having full warranties by the
manufacturer

B. branded product diverted from normal distribution channels in the
country of product origin.

If a company adapts or changes both the product and the
communications, the company engages in a process called ________.
straight extension
marketing communication product adaptation
dual adaptation full adaptation

D. dual adaption

The use of media requires international adaptation because media
availability varies from country to country. Norway, Belgium, and
France do not allow cigarettes and alcohol to be advertised on TB.
Austria and Italy regulate TV advertising ________.
between the hours of 9
p.m. and 6 a.m. to children for those under the
age of majority regarding content and clarity
using women in advertising

B. to children

A Gucci bag sells for $120 in Italy and $240 in the United States.
This is an example of when a firm tries to sell its products abroad.
This phenomenon is called a ________.
strategic marketing
pricing problem market pricing problem tactical
pricing problem price escalation problem transfer
pricing problem

D. price escalation problem

A firm that charges a price to another unit in the company sets the
________ price for goods that it ships to its foreign subsidiaries.
original price
transfer price margin price break-even
price customer value price

B. Transfer Price

The cost escalation problem exists for multinationals and varies from
country to country; the question is: How to set prices in different
countries? Companies have three choices. One is to set a uniform price
everywhere, two is to set a market-based price in each country, and
three is to ________.
set a final �cost plus�
price in each country set a cost-based price in each
country let the market dictate price/country vary
the price/market/country on a daily basis to reflect consumer
demand set the transfer price at marginal costs = marginal
revenue

B. Set a cost based price in each country

In 2000 Stelco a Canadian steelmaker, successfully fought dumping
changes against steelmakers in Brazil and other countries. �Dumping�
is defined or occurs when ________.
a company charges either
less than its costs or less than it charges in its home market
the company charges less that its costs but more than it charges
in its home market the company�s pricing plans are below
current domestic prices a company must increase its
prices/product prior to importing the product a company
unloads an excess supply of the product at the best possible prices
to the consumer

A. a company charges either less than its costs or less than it
charges in its home market

The �whole channel concept for international marketing� includes the
following steps________.
seller to seller�s
international marketing headquarters to channels between nations to
channels within foreign nations to final buyers seller to
marketing headquarters to channels within foreign markets to final
buyers sellers to channels between nations to final
buyers sellers to channels within foreign nations to final
buyers sellers to international markets to channels within
foreign nations to final buyers

A. seller to seller's international marketing headquarters to
channels between nations to channels within foreign nations to final buyers

In an increasingly connected, highly competitive global marketplace,
government officials, and marketers are concerned with how attitudes
and beliefs about their country affect consumer and business
decision-making. ________is(are) the mental associations and beliefs
triggered by a country.
Corporate ownership of
the firm Materials used in manufacturing Brand
names and trademarks Country-of-origin perceptions
Competitive positions in the marketplace

D. country-or-origin perceptions

A company has several options when its products are competitively
priced but their place of origin turns consumers off. The company can
consider ________.
re-packaging the product
to disguise the country of origin co-branding
reducing their country of origin mentions in their
advertising re-branding the product to disguise the country
of origin co-production with a foreign company that has a
better name.

E. co-production with a foreign company that has a better name

Most brands are adapted to some extent to reflect significant
differences in ________, ________, competitive forces, and the legal
and political environment.
consumer behavior, brand
development business mission, brand development
strategy and consumer behavior programs and marketing
communications political and social mores differences

A. consumer behavior, brand development

Disadvantages to global marketing include differences in consumer
needs, wants, and usage patterns for products; difference in consumer
response to marketing-mix elements; differences in brand and product
development and the competitive environment; and ________.
differences in marketing
institutions differences in language and consumer
expectations differences in product performance
differences in management�s reaction to the marketplace
none of the above

A. differences in marketing institutions

Marketers must also adapt sales promotion techniques to different
markets. Several European countries have laws preventing or limiting
sales promotion tools such as discounts. In Germany, Lands� End could
not advertise its ________.
woman�s bathing
suits sale price close-out specials
end-of-the-season sale money-back guarantee

E. money-back guarantee

Companies can manage their international marketing activities in
three ways. These include, through export departments, international
divisions, ________.
or a global
organization or from a fixed corporate headquarters
or through a strong marketing department in the �host�
country and through local marketing efforts none of
the above

A. or a global organization

Bartlett and Ghoshal have identified three organizational strategies
for international firms. These are: (1) a global strategy treats the
world as a single market; (2) a multinational strategy treats the
world as a portfolio of national opportunities; and (3) ________.
a local strategy
standardizes all of the local elements the marketing
strategy identifies those elements assigned to a country and uses
those elements plus corporate�s contribution in the marketing
plan a �glocal� strategy standardizes certain core elements
and localizes other elements assumes that there are no
�local� or multinational differences in formulating the marketing
mix none of the above

C. a "glocal" strategy standardizes certain core elements
and localizes other elements

A small firm has decided to enter the international market. At the
present time, the firm has decided to enter only one country. What is
the next step in the decision making process if the firm is to
continue with its plans?
Deciding on the
marketing organization. Deciding on the marketing
program. Deciding how to enter the market. Deciding
whether to go abroad. Deciding which markets to enter.

C. Deciding how to enter the market

When Microsoft introduces a new form of Windows software, the
first-mover approach is preferred. Microsoft would then tend to use
which form of entry strategy?
Market
attractiveness Continuous Born global
Sprinkler Waterfall

D. Sprinkler

Approximately 85 percent of the world�s population lies outside of
the developed nations and prosperous part of the world. In attempting
to reach these markets, where income and purchasing power is
diminished, marketers could review their service by ________.
offering lower sale
prices and smaller packaging conducting business as usual
in these countries offering lower sales prices but higher
packaging sizes increasing spending in these countries
decreasing expenditures in these countries until the country has
fully developed for their products.

A. offering lower sale prices and smaller packaging

You small firm has decided to begin exporting to a foreign country.
Available to you are the five modes of entry. Your company has decided
on direct exporting as its first venture into the foreign markets.
What would the firm�s next step in the exporting process be,
considering that the next step involves increased risk and commitment
to the processes?
Indirect exporting
Direct exporting Joint venture Direct
investment Licensing

E. Licensing

James Franks works out of Miami and buys locally produced
manufacturer�s products and sells them abroad mainly to Caribbean
nations. Mr. Frank�s is ________.
a domestic-based export
merchant a domestic-based export agent a cooperative
organization an export-management company indirect
exporting

A. a domestic-based export merchant

Mr. Day and Ms. Pound represent a number of producers and carry on
exporting activities for each of them. As a result, Mr. Day and Ms.
Pound�s firm come under the administrative control of these producers.
How would you describe Mr. Day and Ms. Pound�s firm?
Indirect exporters
Cooperative organization Direct exporters
Agents Joint venture

B. Cooperative organization

Your firm has decided to enter the international market with your
product called �Trema�� a new pocket organizer/cell phone combination.
In your discussions about the marketing plans, your CMO has decided
that no changes will be/are necessary in either the marketing mix or
product for export. What form of marketing strategy is the CMO advocating?
Collectivism
Individualism Adapted marketing mix
Engineering-driven marketing mix Standardized marketing
mix

E. Standardized-marketing mix

For the launch of �Trema�� the CMO has decided on no changes to
either the marketing mix or the product necessary. This introduction
is described as ________.
design change
straight extension product adaptation regional
version market version

B. straight extension

Finnish cellular phone superstar Nokia customized its 6100 series
phone for every major market in which it sells the product. In Asia,
for example, the developers raised the ring volume so that it could be
heard on the crowded Asian streets. This kind of adaptation is called ________.
straight extension
market adaptation regional version city
version country version

C. regional version

When the National Cash Register Company reintroduced its
crank-operated cash registers in Latin America and Africa, it was
practicing what form of invention?
Backward invention
Forward invention Product innovation Product
invention None of the above

A. Backward Integration

Your firm has decided to enter the international market with your
product called �Trema�� a new pocket organizer/cell phone combination.
In your discussions about the marketing plans, your CMO has decided
that your firm will use the same advertising program from the �home�
market to the new foreign markets. Your CMO is advocating ________.
product adaptation
dual adaptation straight extension
communication adaptation none of the above

D. Communication adaption

The Trema� launch was a success! Now, a year later, you have been
receiving calls from U.S. dealers complaining that Trema� is available
from international distributors at prices 50 percent less than the
U.S. price. You are faced with the ________ problem due to the
international success of your product.
gray market
export/import problem overstocks distributor
relationships none of the above

A. gray market

Too many U.S. firms think their job is done once the product leaves
the factory for the foreign country. These firms do not pay attention
to how the product moves within the foreign country. There are three
major links between seller and ultimate buyer in the foreign country.
The first link is ________. where the export department or
international division makes decisions on channels and other
marketing-mix elements.
channel partners
corporate headquarters seller�s international marketing
headquarters advertising agencies host country
corporate offices

C. Seller's international marketing headquarters

The second link, ________ gets the products to the borders of the
foreign nation and includes the types of intermediaries that will be
used, the type of transportation, and the financing and risk arrangements.
channels between
nations channels within foreign nations seller�s
international marketing headquarters seller�s corporate
offices host country executive offices

A. Channels between nations

The international division�s corporate staff consists of functional
specialists who provide services to various operating units. Operating
units can be organized several ways. Your firm has a president of your
division who reports to the president of the international division.
This defines your organization as having a ________.
international
company world product group geographical
organization international subsidiaries none of the
above

D. international subsidiaries

If you were the CEO of a company that was truly a global
organization, you would have some decisions to make regarding
corporate strategy. Bartlett and Ghoshal have distinguished three
organizational strategies one of which is to ________.
treat the world as a
single market treat the world as a multiple markets
treat the world as a set of international markets treat
the world as a subset of the �global� market

A. treat the world as a single market

The favorability of country-of-origin perceptions must be considered
both from a domestic and foreign perspective. In the domestic market,
country-of-origin perceptions may stir consumers� ________ or remind
them of the past.
availability of foreign
products patriotic notions product-development
diversification concentric

B. patriotic notions

Bartlett and Ghoshal have proposed circumstances under which
different approaches work best. In their book, Managing Across
Borders, they describe forces that favor �global integration�
(capital-intensive production, and ________).
homogeneous demand
competitive positioning distinctive advantage
need for market share corporate culture

A. homogeneous demand

Exxon used the slogan �Put a tiger in your tank� across countries
with minor variations and gained international recognition. This is an
example of ________.
implementation
strategy formulation communication adaptation
functional analysis dual adaptation

c. communication adaption

Firm�s in general prefer to enter countries that: (1) rank high on
market attractiveness; (2) are low in market risk; and (3) ________.
in which they have a
product alliance in which they would have a competitive
advantage in which they would have a pricing advantage
in which they would have a service advantage in which
they would have a promotional advantage

B. in which they would have a competitive advantage.

Show rooming is associated with which of the following new consumer capabilities?

Consumers can use the Internet as a powerful information and
purchasing aid

_________ combined with affordability determines the product's value proposition.

Acceptability

Sites such as Bizrate.com, Shopping.com, and PriceGrabber.com, and
Opinions.com and Yelp.com, which let customers share information about
their product and service experiences with others, reflect an increase
in customer ________.

Empowerment

BMW is ______ the customer experience when it offers 500 side-mirror
combinations, 1,300 front bumper combinations, and 9,000
center-console combinations and provides new buyers a video link to
watch their car being "born" while waiting for delivery

Personalizing