Ch. 18 Global Opportunities for Small Businesses

Question 1

A document indicating that a product has been shipped and the title to that product has been transferred.

Answer 1

bill of lading

Question 2

Small companies launched with cross-border business activities in mind.

Answer 2

born-global firms

Question 3

The unauthorized use of a company’s intellectual property or manufacture of its products.

Answer 3

counterfeit activity

Question 4

The purchase by a business in one country of a company located in another country.

Answer 4

cross-border acquisition

Question 5

The probability that a country’s government will mismanage its economy in ways that hinder the performance of firms operating there.

Answer 5

economic risk

Question 6

Efficiencies from expanded production that result from spreading fixed costs over more units of output.

Answer 6

economies of scale

Question 7

Per-unit savings gained from the repeated production of the same product.

Answer 7

experience curve efficiencies

Question 8

The expansion of international business, encouraged by converging market preferences, falling trade barriers, and the integration of national economies.

Answer 8

globalization

Question 9

A wholly owned subsidiary formed from scratch in another country.

Answer 9

greenfield venture

Question 10

Selling products produced in another country to buyers in the home country.

Answer 10

importing

Question 11

A strategy that involves accessing foreign business operations through contracts with independent providers.

Answer 11

international outsourcing

Question 12

An organizational relationship that allows companies in different countries to pool resources and share risks as they enter new markets.

Answer 12

international strategic alliance

Question 13

An agreement issued by a bank to honor a draft or other demand for payment when specified conditions are met.

Answer 13

letter of credit

Question 14

The company buying licensing rights.

Answer 14

licensee

Question 15

The company selling licensing rights.

Answer 15

licensor

Question 16

A strategy that involves relocating operations abroad.

Answer 16

offshoring

Question 17

The potential for political forces in a country to negatively affect the performance of businesses operating within its borders.

Answer 17

political risk

Question 18

Fees paid by the licensee to the licensor for each unit produced under a licensing contract.

Answer 18

royalties

Question 19

An agency that distributes a company’s products on a contract basis to customers in another country.

Answer 19

trade intermediary

Question 20

A trip organized to help businesses connect with potential foreign buyers and establish strategic alliances in an international market.

Answer 20

trade mission