Q&A Hero

Q: Firms that seek to maximize their local responsiveness will tend to choose a ________ structure A) transnational B) centralized hub C) decentralized federation D) coordinated federation

Q: What are golden parachutes? How do they motivate executives and key employees to achieve maximization of shareholder wealth?

Q: What are golden handcuffs? How do they motivate executives and key employees to achieve maximization of shareholder wealth?

Q: The role of corporate headquarters in a ________ is to constantly scan business operations across different countries for resources and capabilities that might be a source of competitive advantage for other divisions/country companies in the firm. A) centralized hub B) coordinated federation C) decentralized federation D) transnational structure

Q: In a coordinated federation structure, shared activities and other cross-divisional/cross-country economies of scope are managed by the A) country unit. B) corporate center. C) local unit. D) country manager.

Q: What are restricted stock options? How do they motivate executives and key employees to achieve maximization of shareholder wealth?

Q: In many ways, the transnational structure is similar to the A) coordinated federation. B) centralized hub. C) decentralized federation. D) decentralized hub.

Q: What are stock options? How do they motivate executives and key employees to achieve maximization of shareholder wealth?

Q: Which one of the following structural options combines a high level of both global integration and local responsiveness? A) Centralized hub B) Decentralized hub C) Transnational structure D) Coordinated federation

Q: How can policies control decisions while defining allowable discretion in which operating personnel can execute business strategies? Describe several ways.

Q: Which one of the following is not a structural option for firms pursuing international strategies? A) Corporate federation B) Decentralized federation C) Transnational structure D) Centralized hub

Q: What does it mean to empower employees? How are policies related to the idea of empowerment?

Q: In a ________, strategic and operational decisions are delegated to divisions/country companies. A) transnational structure B) decentralized federation C) coordinated federation D) centralized hub

Q: What is outsourcing? What are the benefits and risks of outsourcing?

Q: Strategic alliances fall within the ________ governance option for firms pursuing international strategies. A) corporate B) market C) intermediate market D) hierarchical

Q: In what three fundamental ways do functional tactics differ from business or corporate strategies? Briefly describe each.

Q: Acquisitions are an example of the ________ governance option for firms pursuing international strategies. A) market B) hierarchical C) corporate D) intermediate market

Q: What are functional tactics? Briefly describe them and provide one example of their use.

Q: Which one of the following is an example of the hierarchical governance option for firms pursuing international strategies? A) Mergers B) Exporting C) Licensing D) Joint ventures

Q: What are three important qualities of effective short-term objectives? Briefly describe each of these in your answer.

Q: Exporting is a form of A) intermediate market governance. B) hierarchical governance. C) vertical governance. D) market governance.

Q: How do short-term objectives help implement strategy?

Q: A firm implements a(n) ________ strategy when it diversifies its business operations across country boundaries. A) functional B) operational C) international D) transnational

Q: (p. 306) A firm with a strategic goal of streamlining operations should use ________ to reward the long-term focus on efficiency and cost control. A. Restricted stock plans B. Stock options C. Cash D. Golden parachutes

Q: Even if direct duplication of a firm's international strategies is ________, ________ might still exist that limit the ability of that strategy to generate sustained competitive advantages. A) costly; substitutes B) inexpensive; substitutes C) costly; fragmentation D) inexpensive; fragmentation

Q: (p. 306) A firm seeking to globalize operations would use ________ as its bonus compensation plan. A. Restricted stock plans B. Golden parachutes C. Golden handcuffs D. Stock options

Q: (p. 306) A firm with a strategic goal of reducing executive turnover would use _________ to provide an incentive for longer executive tenure. A. Cash B. Stock options C. Golden parachutes D. Golden handcuffs

Q: One survey indicated that the foreign experience of ________ percent of U.S. CEOs was limited to vacation travel. A) 14 B) 56 C) 48 D) 61

Q: The ability to develop detailed local knowledge of nondomestic markets may require firms to have management teams with a great deal of ________ experience. A) foreign B) technical C) corporate D) functional

Q: (p. 305) A firm with a strategic goal of growing the share price incrementally should implement a: A. Restricted stock plan B. Stock option plan C. Cash-based plan D. Golden parachute

Q: One survey of CEOs from around the world reported that ________ percent of U.S. CEOs had no foreign experience. A) 25 B) 8 C) 42 D) 14

Q: (p. 305) _______ are executive bonus compensation plans that focus on accounting measures of performance and are designed to offset the limitations of market-based measures of performance. A. Cash restricted plans B. Golden handcuffs C. Restricted stock plans D. Cash-based

Q: Improvements in the ________ infrastructure of business is one of the important contributors to the growth in the number of firms pursuing international strategies. A) pecuniary B) cultural C) technological D) corporate

Q: (p. 300) If the executive quits is fired or simply retires, he would be best protected by a _________, which is designed to retain talented executives. A. Golden handcuff B. Golden parachute C. Cash based plan D. Stock option

Q: Broad changes in the political situation in a foreign country is an example of political risk that affects the international strategies at the ________ level. A) macro B) micro C) functional D) cultural

Q: (p.300) __________ represent a form of executive compensation where compensation is deferred. A. Golden handcuffs B. Golden parachutes C. Golden stock options D. Unrestricted stock options

Q: Hedging is a way to counter the ________ risks of doing business in foreign markets. A) political B) financial C) cultural D) business

Q: (p. 300) Restricted stock plans offer: A. Higher downside risk to executives B. More limited downside risk to executives C. No downside risk to executives D. Limited upside risk to executives

Q: A ________ strategy exploits all the advantages of both international integration and local responsiveness. A) corporate B) multinational C) transnational D) global

Q: (p. 300) A ________ is designed to provide benefits of direct executive stock ownership. A. Restricted stock plan B. Cash based plan C. Golden parachute D. Golden handcuffs plan

Q: ________ can help firms be successful in addressing the local needs of nondomestic customers. A) Globalization B) Internationalization C) Target responsiveness D) Local responsiveness

Q: (p. 300) ________ offers employees more certainty, even if there is less potential for a big win. A. The use of stock options B. A golden parachute C. Stock grants D. Restricted stock

Q: ________ requires a firm to modify or abandon traditional ways of engaging in business. A) Unlearning B) Learning C) Relearning D) Absorbing

Q: Which one of the following is not a determinant of the ability of a firm to learn from its international operations? A) The intent to learn B) The transparency of business partners C) Receptivity to learning D) The resources for learning

Q: (p. 300) __________ are much easier to value than options because they are equivalent to a stock transfer at the market price. A. Restricted stock grants B. Golden handcuffs C. Golden parachutes D. Cash plans

Q: (p. 300) ________ provide incentive for the executive to create wealth for shareholders as measured by increases in the firm's share price. A. Stock option grants B. Golden handcuffs C. Golden parachutes D. Cash-based plans

Q: The second stage in the product life cycle is the ________ stage. A) introduction B) growth C) maturity D) decline

Q: (p. 300) Golden handcuffs: A. Have no downside risk to executives, who always profits unlike other shareholders B. Have a weak correlation between earnings measures and shareholder wealth creation C. Make it hard to explain the dimensions of managerial performance using the movement in share price D. May promote risk-averse decision making due to the downside risk borne by the executive

Q: ________ currencies are currencies that are traded, and thus have value, on international money markets. A) Soft B) Variable C) Operational D) Hard

Q: (p. 300) There is a weak correlation between earnings measures and shareholder wealth creation with the use of a: A. Golden handcuffs plan B. Cash based plan C. Restricted stock plan D. Stock option grant

Q: Variable levies are an example of A) quotas. B) tariffs. C) nontariff barriers. D) countertrade.

Q: (p. 300) The rationale behind golden handcuffs is that the plan: A. Promotes longer executive tenure than other forms of compensation B. Offsets the limitations of focusing on market-based measures of performance C. Offers an incentive for executives to remain with the firm D. Provides incentive for the executive to create wealth for shareholders as measured by increase in the firm's share price

Q: Countervailing duties are an example of A) quotas. B) nontariff barriers acquisition. C) tariffs. D) countertrade.

Q: (p. 299) ______ dilute shareholders equity when they are exercized A. Golden handcuffs B. Stock options C. Golden parachutes D. Restricted stock plans

Q: Embargoes are an example of A) quotas. B) tariffs. C) nontariff barriers. D) subsidies.

Q: (p. 299) Stock options have typically represented _______ of a CEO's average pay package. A. Less than 30 percent B. Less than 50 percent C. More than 50 percent D. More than 90 percent

Q: Japanese retail distribution has historically been much more ________ than the system that exists in the United States or Western Europe. A) closely held B) fragmented C) consolidated D) open

Q: (p. 299) A common measure of _______ creation is appreciation of company stock price A. shareholder wealth B. revenue C. sales D. job

Q: Different ________ standards can require a firm pursuing international opportunities to change its current products or services to sell them into a nondomestic market. A) financial B) operational C) fiscal D) physical

Q: (p. 299) ______ provide the executive with the right to purchase company stock at a fixed price in the future. A. Golden handcuffs B. Stock options C. Golden parachutes D. Restricted stock plans

Q: Which one of the following is not a potential source of economies of scope for firms pursuing international strategies? A) To develop new core competencies B) To manage corporate risk C) To control countertrade D) To gain access to low-cost factors of production

Q: (p. 299) A common measure of shareholder wealth creation is appreciation of company A. revenues B. stock price C. employees D. stockholders

Q: International strategies are an example of ________ strategies. A) corporate B) business C) functional D) operational

Q: (p. 299) The success of bonus compensation as an incentive hinges on: A. The executive in question B. The success of the firm C. The match between the plan and the firm's strategic objectives D. The positive link between shareholder wealth and personal wealth maximization

Q: In many ways, the transnational structure is similar to the centralized hub.

Q: (p. 299) The goal of ______ is not the only goal that executives may pursue. A. Organizational policies B. Organizational rewards C. Managerial rewards D. Shareholder wealth maximization

Q: Firms can maintain traditional arm's-length market relationship between themselves and their nondomestic customers and still implement international strategies.

Q: (p. 299) The goal of an executive bonus compensation plan is to: A. Motivate executives to achieve maximization of shareholder wealth B. Motivate executives to achieve maximization of personal wealth C. Differentiate executives from other managers D. Ensure the success of the firm

Q: In a decentralized federation, each country in which the firm operates is organized as a full profit-and-loss division headed by a division general manager who is typically the president of the company in a particular country.

Q: Government upheaval and the attendant risks to international firms are facts of life in some countries.

Q: (p. 299) Policies can be externally imposed or ______ A. stakeholder driven B. mandated by stockholders C. internally derived D. mandated by the stock market

Q: Hedging strategies reduce the business risks that firms assume when they enter into nondomestic markets.

Q: (p. 299) ________ theoretically reward(s) the actions of people within an organization. A. Development B. Compensation C. Policies D. Action plans

Q: The financial risks can be daunting when a firm first begins international operations.

Q: (p. 298) The ______ significance of policies can vary. A. visionary B. routine C. strategic D. important

Q: Currency fluctuations can significantly affect the value of a firm's domestic investments.

Q: (p. 298) Policies can be ________. One good example of this is the use of equal employment opportunity practices. A. Internally derived B. Negative C. Externally imposed D. Very simple in nature

Q: A multinational strategy exploits all the advantages of both international integration and local responsiveness.

Q: (p. 298) The strategic ________ of policies can vary. A. Direction B. Plan C. Significance D. Advantage

Q: Local responsiveness can help firms be successful in addressing the local needs of nondomestic customers, thereby increasing demand for a firm's current products or services.