Chapter 2

Question 1

Mexican factories located along the US-Mexico border that receive preferential tariff treatment.

Answer 1

Maquiladoras.

Question 2

International organization that promotes world trade by lowering barriers to the free flow of goods across borders.

Answer 2

World trade organization (WTO)

Question 3

Free trade agreement between Canada, Mexico, and the US

Answer 3

NAFTA

Question 4

European trade group that has 27 member states.

Answer 4

European Union.

Question 5

Purpose or rationale for an organizations existence.

Answer 5

Mission

Question 6

How an organization expects to achieve its missions and goals.

Answer 6

Strategy

Question 7

Firms achieve missions in 3 conceptual ways:

Answer 7

Differentiation, cost leadership and response.

Question 8

Creation of a unique advantage over competitors.

Answer 8

Competitive advantage.

Question 9

Distinguishing the offerings of an organization in a way that the customer perceives as adding value.

Answer 9

Differentiation

Question 10

Engaging a customer with a product through imaginative use of the five senses, so the customer “experiences” the product.

Answer 10

Experience differentiation

Question 11

Achieving max value, as perceived by the customer.

Answer 11

Low cost leadership

Question 12

Set of values related to rapid, flexible and reliable performance.

Answer 12

Response

Question 13

Method managers use to evaluate the resources at their disposal and manage or alter them to achieve competitive advantage.

Answer 13

Resource view

Question 14

Way to identify those elements in the product or service chain that uniquely adds value.

Answer 14

Value-chain analysis

Question 15

Method of analyzing the five forces in the competitive environment.

Answer 15

Five forces model

Question 16

Method of determine internal strengths, weaknesses, and external opportunities and threats.

Answer 16

SWOT analysis

Question 17

Activities of factors that are key to achieving competitive advantage.

Answer 17

Key success factors

Question 18

Set of skills, talents, and capabilities in which a firm is particularly strong.

Answer 18

Core competencies.

Question 19

A graphed link of competitive advantage, KSF’s and supporting activities.

Answer 19

Activity map

Question 20

Transferring a firms activities that have traditionally internal to external suppliers.

Answer 20

Outsourcing

Question 21

Theory which states that countries benefit from specializing in goods and services in which they have relative advantage and they benefit from importing goods and services in which they have a relative disadvantage.

Answer 21

Theory of competitive advantage.

Question 22

Firm that engages in cross-border transactions

Answer 22

International business

Question 23

Firm that had extensive involvement in international business, owning or controlling facilities in more than one country.

Answer 23

Multinational corporation

Question 24

Strategy in which global markets are penetrated using exports and licenses.

Answer 24

International strategy

Question 25

Strategy in which operating decisions are decentralized to each country to enhance local responsiveness

Answer 25

Multidomestic strategy

Question 26

Strategy in which operating decisions are centralized and headquarters coordinates the standardization and learning between facilities.

Answer 26

Global strategy

Question 27

Strategy that combines the benefits of global-scale efficiencies with the benefits of local responsiveness.

Answer 27

Transnational strategy.

Question 28

Theory stating that if an external provider can perform activities more productively than the purchasing firm, then the external provider should do the work. Purchasing firm focuses on core competencies and drives outsourcing.

Answer 28

Theory of comparative advantage

Question 29

Strategy that imports/exports or licenses existing product. Examples: US steel and Harley Davidson

Answer 29

International strategy

Question 30

Strategy that standardized product, uses economies of scale, cross-cultural learning. Examples: Texas Instruments, caterpillar, otis elevator.

Answer 30

Global strategy

Question 31

Strategy that uses existing domestic model globally, franchise, joint ventures, subsidiaries. Examples: Heinz, McDonald’s, Hard Rock Cafe

Answer 31

Multidomestic strategy

Question 32

Strategy that moves material, people or ideas across national boundaries. Uses economies of scale, cross-cultural learning. Examples: Coca-Cola and nestle

Answer 32

Transnational strategy