Ch.6

Question 1

trade feedback effect

Answer 1

A country’s imports affect its exports and a country’s exports affect its imports.

Question 2

countertrade

Answer 2

The practice of using barter rather than money for making global sales.

Question 3

gross domestic product

Answer 3

The monetary value of all products and services produced in a country during one year

Question 4

balance of trade

Answer 4

the difference between the monetary value of a nation’s exports and imports

Question 5

Globalization

Answer 5

The focus on creating economic, cultural, political, and technological interdependence among individual national institutions and economics.

Question 6

Five developments significantly influence the landscape of global marketing and globalization over the past decade`

Answer 6

1. Economic protectionism by individual countries.
2. Economic integration among countries.
3. Global competition among global companies for global consumers.
4. the presence of a networked global market space.
5. the growing prevalence of economic espionage.

Question 7

Protectionism

Answer 7

The practice of shielding one or more industries within a country’s economy from foreign competition through the use of tariffs or quotas.

Question 8

Tariffs

Answer 8

Government taxes on products or services entering a country that primarily serve to raise prices on imports.

Question 9

quota

Answer 9

A restriction placed on the amount of product allowed to enter or leave a country.

Question 10

World Trade Organization (WTO)

Answer 10

A permanent institution that sets rules governing trade between its members through panels of trade experts who decide on trade disputes between members and issues binding decisions.

Question 11

Trade war

Answer 11

A situation in which countries try to damage each other’s trade, typically by imposition of tariff and quota restrictions.

Question 12

European Union

Answer 12

consists of 27 member countries that have eliminated most barriers to free flow of products, services, capital, and labor across their borders.

Question 13

global competition

Answer 13

Exists when firms originate, produce, and market their products and services worldwide.

Question 14

Three types of companies populate and compete in the global marketplace

Answer 14

International firms, multinational firms, and transnational firms

Question 15

multidomestic marketing strategy

Answer 15

A strategy used by multinational firms that have as many product variations, brand names, and advertising programs as countries in which they do business.

Question 16

global marketing strategy

Answer 16

a strategy used by transnational firms that employ the practice of standardizing marketing activities when there are cultural similarities and adapting them when cultures differ.

Question 17

global brand

Answer 17

a brand marketed under the same name in multipl countries with similar and centrally coordinated marketing programs.

Question 18

global consumers

Answer 18

consumer groups living in many countries or regions of the world who have similar needs or seek similar features and benefits from products or services.

Question 19

economic espionage

Answer 19

the clandestine collection of trade secrets or proprietary information about a company’s competitors.

Question 20

cross-cultural analysis

Answer 20

The study of similarities and differences among consumers in two or more nations or societies

Question 21

customs

Answer 21

what is considered normal and expected about the way people do things in a specific country.

Question 22

Foreign Corrupt Practices Act (1977)

Answer 22

A law, amended by the international anti-dumping and fair competition act (1998), that makes it a crime for U.S. corporations to bribe an official of a foreign government or political party to obtain or retain business in a foreign country.

Question 23

Cultural symbols

Answer 23

Things that represent ideas and concepts in a specific culture.

Question 24

back translation

Answer 24

the practice where a translated word or phrase is retranslated into the original language by a different interpreter to catch errors.

Question 25

cultural ethnocentricity

Answer 25

the belief that aspects of one’s culture are superior to another’s

Question 26

consumer ethnocentrism

Answer 26

The tendency to believe that it is inappropriate, indeed immoral, to purchase foreign-made products.

Question 27

Currency exchange rate

Answer 27

the price of one country’s currency expressed in terms of another country;s currency.

Question 28

exporting

Answer 28

a global market-entry strategy in which a company produces products in one country and sells them in another country.

Question 29

indirect exporting

Answer 29

when a firm sells its domestically produced products in a foreign country through an intermediary

Question 30

direct exporting

Answer 30

When a firm sells its domestically produced products in a foreign country without intermediaries

Question 31

franchising

Question 32

joint venture

Answer 32

a global market-entry strategy in which a foreign company and a local firm invest together to create a local business in order to share ownership, control, and profits of the new company.

Question 33

Product may be sold globally in one of three ways

Answer 33

1. product extension, product adaption, product invention

Question 34

dumping

Answer 34

When a firm sells a product in a foreign country below its domestic price or below its actual cost.