Pre-Test 1

Question 1

Economic interdependence as measured by relative importance of foreign trade is generally greater for

Answer 1

Small nations

Question 2

The institution-based view of global business focuses on the dynamic interaction amoung

Answer 2

1. Institutions
2. Firms
3. Firm behaviors

Question 3

Factors behind English being accepted as the global business language

Answer 3

1. English-speaking countries contribute the single largest share of global output
2. Recent globalization has called for the use of 1 common language making it easier and cheaper to trade

Question 4

Largest religion in the world based on number of adherents

Answer 4

Christianity

Question 5

institutional transitions

Answer 5

fundamental and comprehensive changes introduced to the formal and informal rules of the game that affect organizations as players

Question 6

Economies in the base of the global economic pyramid

Answer 6

Economies where people make less than $2,000 per capita per year

1. They are largely ignored by MNEs
2. Income levels are rising

Question 7

Ethnocentrism

Answer 7

the quality of a society that perceives its own culture, ethics, and norms as natural, rational, and morally right

Question 8

the Chameleon

Answer 8

characterizes a person who may be mistaken for a native in a foreign country and is able to profitably balance insider skills with an outsider’s perspective

Question 9

The largest number of people who benefited from globalization reside in what countries?

Answer 9

LDC and TEC

Question 10

the GDP of china is close to what share of the world’s GDP measured at PPP

Answer 10

20%

Question 11

4 norms associated with 4 strategic responses of firms when dealing with ethical challenges (PRAD)

Answer 11

1. Proactive
2. Reactive
3. Accomodative
4. Proactive

Question 12

Proactive strategic response when dealing with ethical challenges

Answer 12

A firm anticipates institutional changes and does more than required by current regulations

Question 13

Reactive strategic response when dealing with ethical challenges

Answer 13

firm is passive and does not feel compelled to act when problems arise.

Question 14

Accommodative strategic response when dealing with ethical challenges

Answer 14

firm accepts responsibility and will act beyond what is simply required

Question 15

Defensive strategic response when dealing with ethical challenges

Answer 15

firm fights informal pressure and is only concerned with required regulatory compliance

Question 16

Reverse Innovation

Answer 16

-an innovation that is adopted first in emerging economies and is then diffused around the world -Traditionally innovation occurs in the Triad and when MNE entered lower-income economies, they tended to simplify the product features and lower the prices (innovation top down)

Question 17

How reverse innovation is helping emerging economies

Answer 17

• suggest that emerging economies are no longer low-cost production locations or attractive new markets
• they are also sources of new innovations that may not only grow out of the bottom of the pyramid markets but also have the potential to penetrate into the top of the economic pyramid.