With respect to global marketing management, the argument for market segmentation in the 1980s was

framed as _____. 
A.  globalization versus localization
In the 1970s, the market segmentation argument was framed as "standardization versus adaptation." In
the 1980s, it was "globalization versus localization," and in the 1990s, it was "global integration versus
local responsiveness."

In the context of global marketing management, international marketers framed the argument toward
market segmentation during the 1970s as _____. 
B.  standardization versus adaptation
In the 1970s, the market segmentation argument was framed as "standardization versus adaptation." In
the 1980s, it was "globalization versus localization," and in the 1990s, it was "global integration versus
local responsiveness."

Which of the following companies has been known for its ability to adapt to local needs and wants in
the international marketplace since its inception in 1866? 
E.  Nestlé
Nestlé has been international almost from its start in 1866 as a maker of infant formula. Nestlé certainly
hasn't been bothered by the debate on standardization versus adaptation. Its overall strategy can be
summarized in four points: (1) think and plan long term, (2) decentralize, (3) stick to what you know,
and (4) adapt to local tastes.

 Which of the following is true about international corporate planning? 

D.  It is essentially long term in nature.
International corporate planning is essentially long term, incorporating generalized goals for an
enterprise as a whole. Strategic planning is conducted at the highest levels of management and
deals with products, capital, research, and the long- and short-term goals of the company. Tactical
planning, or market planning, pertains to specific actions and to the allocation of resources used to
implement strategic planning goals in specific markets. Tactical plans are made at the local level and
address marketing and advertising questions.
 
Which of the following is true about international corporate planning? 
D.  It incorporates generalized goals for an enterprise as a whole.
International corporate planning is essentially long term, incorporating generalized goals for an
enterprise as a whole. Strategic planning is conducted at the highest levels of management and deals
with products, capital, research, and the long- and short-term goals of a company. Tactical planning, or
market planning, pertains to specific actions and to the allocation of resources used to implement
strategic planning goals in specific markets. Tactical plans are made at the local level and address
marketing and advertising questions.

  Which of the following is true about strategic planning? 

B.  It deals with a company's products and capital.
International corporate planning is essentially long term, incorporating generalized goals for an
enterprise as a whole. Strategic planning is conducted at the highest levels of management and deals
with products, capital, research, and the long- and short-term goals of a company. Tactical planning, or
market planning, pertains to specific actions and to the allocation of resources used to implement
 strategic planning goals in specific markets. Tactical plans are made at the local level and address
marketing and advertising questions.

  Which of the following is true about tactical planning? 

A.  It is designed to address questions that relate to advertising and marketing.
International corporate planning is essentially long term, incorporating generalized goals for an
enterprise as a whole. Strategic planning is conducted at the highest levels of management and deals
with products, capital, research, and the long- and short-term goals of a company. Tactical planning, or
market planning, pertains to specific actions and to the allocation of resources used to implement
strategic planning goals in specific markets. Tactical plans are made at the local level and address
marketing and advertising questions.

  Simon and his team draft a plan for their organization, MG Corp. They primarily establish the overall
goals that MG should accomplish in the next 25 years. In this case, Simon and his team are most likely
engaged in _____ planning. 
C.  corporate
In this case, Simon and his team are most likely engaged in corporate planning. International corporate
planning is essentially long term, incorporating generalized goals for an enterprise as a whole.

  _____ planning is conducted at the highest levels of management and deals with products, capital,
research, and the long- and short-term goals of a company. 
D.  Strategic
Strategic planning is conducted at the highest levels of management and deals with products, capital,
research, and the long- and short-term goals of a company.

 If a company were to focus on market planning that involved specific actions and allocation of
resources, the company would most likely be using _____ planning. 
A.  tactical
Tactical planning, or market planning, pertains to specific actions and to the allocation of resources
used to implement strategic planning goals in specific markets.

Which of the following is the first phase in the international planning process? 
C.  Matching company and country needs
Whether a company is new to international marketing or heavily involved, an evaluation of potential
markets is the first step in the planning process. A critical first step in the international planning process
is deciding in which existing country market to make a market investment. Refer to Exhibit 12.1-
International Planning Process.

 Which of these aspects of international marketing is analyzed in Phase 1 of the international planning
process? 
A.  Company character
A critical first step in the international planning process is deciding in which existing country market to
make a market investment. A company's strengths and weaknesses, including the characteristics of its
home country, products, philosophies, modes of operation, and objectives must be matched with a
country's constraining factors and market potential. Refer to Exhibit 12.1-International Planning
Process.
Which of these aspects of international marketing are analyzed in Phase 1 of the international planning
process? 
A.  Home-country constraints
Company character, home-country constraints, and host-country constraints are analyzed in the first
phase of the international planning process. A company's strengths and weaknesses, including the
characteristics of its home country, products, philosophies, modes of operation, and objectives must be
matched with a country's constraining factors and market potential. Refer to Exhibit 12.1-International
Planning Process.

Which of these aspects of international marketing are analyzed in Phase 1 of the international planning
process? 
E.  Host-country constraints
Company character, home-country constraints, and host-country constraints are analyzed in the first
phase of the international planning process. A company's strengths and weaknesses, including the
characteristics of its home country, products, philosophies, modes of operation, and objectives must be
matched with a country's constraining factors and market potential. Refer to Exhibit 12.1-International
Planning Process.

 At which phase of the international planning process would a marketing manager conduct situation
analysis and make decisions involving objectives and goals, budgets, and action programs? 
B.  Developing the marketing plan
Phase 3 of the international planning process involves developing the marketing plan. At this stage, a
marketing manager conducts situation analysis and makes decisions regarding objectives and goals,
strategy and tactics, mode of entry, budgets, and action programs. Refer to Exhibit 12.1-International
Planning Process.

 Analysis of which of the following factors is carried out in Phase 2 of the international planning
process? 
B.  Product adaptation
The primary goal of Phase 2 of the international planning process is to decide on a marketing mix
adjusted to the cultural constraints imposed by the uncontrollable elements of the environment that
effectively achieves corporate objectives and goals. Product characteristics including product
adaptation, pricing, promotion, and distribution are analyzed in Phase 2 of the international planning
process. Incorrect decisions at this point lead to products inappropriate for the intended market or
costly mistakes in pricing, advertising, and promotion. Refer to Exhibit 12.1-International Planning
Process.

Analysis of which of the following factors is carried out in Phase 2 of the international planning
process? 
B.  Pricing
 
Analysis of which of the following factors is carried out in Phase 2 of the international planning process? 
D.  Advertising
 
Analysis of which of the following factors is carried out in Phase 2 of the international planning
process? 
B.  Distribution
 
The primary goal of Phase 2 of the international planning process is to: 
C.  decide on a marketing mix according to the market segments.
The primary goal of Phase 2 of the international planning process is to decide on a marketing mix
adjusted to the cultural constraints imposed by the uncontrollable elements of the environment
that effectively achieves corporate objectives and goals.

Big Donuts has already reviewed its objectives and capabilities, established the screening criteria
for reviewing potential foreign markets, and examined a series of environmental factors for the
markets in which it plans to operate. What should Big Donuts do next as it proceeds with the
international planning process? 
B.  Evaluate the marketing mix to target markets.
Once target markets are selected, the marketing mix must be evaluated in light of the data
generated in Phase 1 of the international planning process.

  The answers to which of the following questions is generated in Phase 2 of the international
marketing process? 
A.  Are there identifiable market segments that allow for common marketing mix tactics across
countries?
The answers to three major questions are generated in Phase 2 of the international marketing
process: a) Are there identifiable market segments that allow for common marketing mix tactics
across countries? b) Which cultural/environmental adaptations are necessary for successful
acceptance of the marketing mix? c) Will adaptation costs allow profitable market entry?

  Which of the following actions does the marketing plan in Phase 3 of the international planning
process begin with? 
C.  Conducting a situation analysis
In Phase 3 of the planning process, a marketing plan is developed for the target market—whether
it is a single country or a global market set. The marketing plan begins with a situation analysis and
culminates in the selection of an entry mode and a specific action program for the market.

  Harry Johnson Tractor Corp. has just completed a marketing plan for entering South Africa.
Included in this plan are budgets and sales and profit expectations. Which of the following phases
of the international planning process has Harry Johnson Tractor just completed? 
C.  Phase 3
In this case, Harry Johnson Tractor Corp. has just completed Phase 3 of the international planning
process. In Phase 3 of the international planning process, a marketing plan is developed for the
target market—whether it is a single country or a global market set. The marketing plan begins
with a situation analysis and culminates in the selection of an entry mode and a specific action
program for the market. The marketing plan includes budgets and sales and profit expectations.

 
Harry Johnson Tractor Corp. wishes to expand its presence in Eastern Europe. Toward that end, it
has selected the countries where it will market its products. It has also selected a mode of entry. It
is now in the process of implementing specific plans. Which of the following phases of the
international planning process is Harry Johnson Tractor Corp. currently in? 
D.  Phase 4
In this case, Harry Johnson Tractor Corp. is currently in Phase 4 of the international planning
 process. A "go" decision in Phase 3 triggers Phase 4 of the international planning process. Phase 4
involves implementation of specific plans and anticipation of successful marketing.

Pizza Hearth is in the process of deciding on the mode of entry into countries of Eastern Europe.
Which phase of the international planning process is Pizza Hearth currently in? 
C.  Developing the marketing plan
In this scenario, Pizza Hearth is currently in Phase 3 of the international planning process. In this
phase, a marketing plan is developed for the target market—whether it is a single country or a
global market set. The marketing plan begins with a situation analysis and culminates in the
selection of an entry mode and a specific action program for the market.

 Which of the following is most likely to occur in the international planning process once a "go"
decision in Phase 3 has been taken? 
D.  The implementation and control phase
A "go" decision in Phase 3 of the international planning process triggers implementation of specific
plans and anticipation of successful marketing.

  Which of the following subjects is explored after developing information and selecting a country
market in the international planning process? 
E.  The mode of entry
With the information developed in the international planning process and a country market
selected, the decision regarding the entry mode can be made. The choice of mode of entry is one of
the more critical decisions for a firm because the choice will define the firm's operations and affect
all future decisions in that market.

  Which of the following is the last step in the international planning process? 
D.  Implementation and control
All marketing plans require coordination and control during the period of implementation.
Implementation and control constitute the last step in the international planning process.

Which of the following modes of foreign market entry requires the most amount of equity and
therefore, creates the greatest risk? 
E.  Direct foreign investment
Direct foreign investment requires the most equity of the four modes of foreign market entry and
creates the greatest risk while offering the most control and the potential highest return.
Which of the following modes of foreign market entry offers the most control and the highest
potential return for a company? 
E.  Direct foreign investment
Direct foreign investment requires the most equity of the four modes of foreign market entry
and creates the greatest risk while offering the most control and the potential highest return.

GHB Corp. is a manufacturer of consumer goods. It intends to sell its products in Vietnam as it is
looking to enter into Asian markets. It does not want to make any equity investment and is keen
on minimizing any risk of loss in the foreign market. It is also willing to settle for a low rate of
return. Which of the following types of foreign market-entry strategies is GHB most likely to
follow? 
C.  Indirect exporting
In this case, GHB Corp. is most likely to follow indirect exporting. The amount of equity required
by a company to use different modes affects the risk, return, and control that it will have in each
mode. Indirect exporting requires no equity investment and thus has a low risk, low rate of
return, and little control.

In the context of foreign market entry, _____ requires no equity investment and thus has a low
risk, low rate of return, and little control. 
B.  indirect exporting
Indirect exporting requires no equity investment and thus has a low risk, low rate of return, and
little control.
 
Pots and Pans Inc., a large U.S. kitchenware distributor, sells its inventory twice a year to CookWell Corp.,
a kitchenware retailer in the United States. CookWell, in turn, sells those products through its retail stores in
Vietnam and Thailand. Which of the following is Pots and Pans most likely engaged in? 
B.  Indirect exporting
Pots and Pans Inc. is engaged in indirect exporting. Indirect exporting usually means that a company sells to
a buyer (importer or distributor) in the home country, which in turn exports the product.
Pots and Pans Inc., a large U.S. kitchenware distributor, takes a selection of its inventory twice a year to
Vietnam and sells it to CookWell Corp., a large Vietnam-based kitchen retailer. CookWell, in turn, sells
those products through its retail stores in Vietnam and Thailand. Which of the following best describes the
alternative market-entry strategy that Pots and Pans is engaged in? 

C.  Direct exporting

In this scenario, Pots and Pans Inc. is engaged in direct exporting. With direct exporting, a company sells to
a customer in another country. This method is the most common approach employed by companies taking
their first international step because the risks of financial loss can be minimized.
 
66. A direct sales force may be required in a foreign country particularly for _____. 
 

A.  big ticket industrial products

B.  low-technology products
C.  personal care products
D.  nonmechanical goods
E.  traditional hand-made goods
Particularly for high-technology and big ticket industrial products, a direct sales force may be required in a
foreign country.
 
67. In the context of foreign market entry, _____ are long-term, nonequity associations between a company and
another in a foreign market. 
 

A.  consortia
B.  exporting arrangements
C.  direct foreign investments
D.  contractual agreements
E.  joint ventures
Contractual agreements are long-term, nonequity associations between a company and another in a foreign
market.
 
68. In the context of foreign market entry, _____ serve as a means of transfer of knowledge rather than equity. 
 

A.  consortia
B.  contractual agreements
C.  strategic alliances
D.  foreign direct investments
E.  joint ventures
Contractual agreements serve as a means of transfer of knowledge rather than equity.
 
69. In the context of foreign market entry strategies, the advantages of _____ are most apparent when capital is
scarce, import restrictions forbid other means of entry, a country is sensitive to foreign ownership, or patents
and trademarks must be protected against cancellation for nonuse. 
 

A.  consortia
B.  exporting arrangements
C.  strategic alliances
D.  licensing
E.  joint ventures
The advantages of licensing are most apparent when capital is scarce, import restrictions forbid other means
of entry, a country is sensitive to foreign ownership, or patents and trademarks must be protected against
cancellation for nonuse.
 
70. Which of the following forms of business relationships lets a company grant patent rights, trademark rights,
and the rights to use technological processes to another company in a foreign country? 
 

A.  Licensing
B.  Exporting arrangements
C.  Joint ventures
D.  Consortia
E.  Strategic alliances
Patent rights, trademark rights, and the rights to use technological processes are granted in foreign licensing.
 
71. Which of the following is true of franchising? 
 

A.  It provides an effective blending of skill decentralization and operational centralization.

B.  The franchisee provides market knowledge, capital, and personal involvement in management.
C.  Foreign laws and regulations are usually hostile toward franchising.
D.  It is an important form of horizontal market integration.
E.  The franchiser has little control on marketing of the products at the point of final sale.
Franchising is a rapidly growing form of licensing in which the franchiser provides a standard package of
products, systems, and management services, and the franchisee provides market knowledge, capital, and
personal involvement in management. The combination of skills permits flexibility in dealing with local
market conditions and yet provides the parent firm with a reasonable degree of control. The franchiser can
follow through on marketing of the products to the point of final sale. It is an important form of vertical
market integration. Potentially, the franchise system provides an effective blending of skill centralization
and operational decentralization. Foreign laws and regulations are friendly toward franchising because it
tends to foster local ownership, operations, and employment.
 
72. Kwok Winn wants to open a new business in his own country, Singapore. He has decided on a form of
licensing that will provide him with a standard package of products, systems, and management services in
order to sell fast food to local residents. Which of the following best describes the form of business that Mr.
Winn has chosen? 
 

A.  Direct sales

B.  Indirect exporting
C.  Joint venture
D.  Strategic alliance
E.  Franchising
In this case, Mr. Winn has chosen to conduct his business through franchising. Franchising is a rapidly
growing form of licensing in which the franchiser provides a standard package of products, systems, and
management services, and the franchisee provides market knowledge, capital, and personal involvement in
management.
 
73. Which of the following is true of franchising? 
 

A.  It is an important form of horizontal market integration.

B.  The franchiser has little control on marketing of the products at the point of final sale.
C.  Foreign laws and regulations are friendly toward franchising.
D.  It provides an effective blending of skill decentralization and operational centralization.
E.  The franchiser provides market knowledge, capital, and personal involvement in management.
Franchising is a rapidly growing form of licensing in which the franchiser provides a standard package of
products, systems, and management services, and the franchisee provides market knowledge, capital, and
personal involvement in management. The combination of skills permits flexibility in dealing with local
market conditions and yet provides the parent firm with a reasonable degree of control. The franchiser can
follow through on marketing of the products to the point of final sale. It is an important form of vertical
market integration. Potentially, the franchise system provides an effective blending of skill centralization
and operational decentralization. Foreign laws and regulations are friendly toward franchising because it
tends to foster local ownership, operations, and employment.
 
74. In the context of foreign market entry, a _____ is a business relationship established by two or more
companies to cooperate out of mutual need and to share risk in achieving a common objective without
forming a separate legal entity. 
 

A.  direct sales group

B.  consortium arrangement
C.  franchising arrangement
D.  strategic international alliance
E.  joint venture
A strategic international alliance (SIA) is a business relationship established by two or more companies to
cooperate out of mutual need and to share risk in achieving a common objective.
 
75. The first relationship activity in building a strategic alliance, where senior executives leverage their personal
networks is labeled as _____. 
 

A.  imaging
B.  initiating
C.  committing
D.  dating
E.  interfacing
The first relationship activity in building a strategic alliance is labeled as dating. It involves senior
executives leveraging personal networks and wondering how to respond to inquiries and how to seek out
possibilities. Refer to Exhibit 12.3-Building Strategic Alliances.
 
76. Which of the following primary relationship activities in building strategic alliances involves seeing the
reality in possibilities of an alliance, creating a shared vision from being together, and involving trusted
senior managers? 
 

A.  Imaging
B.  Committing
C.  Interfacing
D.  Dating
E.  Initiating
The second relationship activity in building a strategic alliance is labeled as imaging. It involves seeing the
reality in possibilities of an alliance, creating a shared vision from being together, and involving trusted
senior managers. Refer to Exhibit 12.3-Building Strategic Alliances.
 
77. Which of the following primary relationship activities in building strategic alliances involves bringing key
executives into action and creating trust through face-to-face time? 
 

A.  Dating
B.  Initiating
C.  Committing
D.  Imaging
E.  Interfacing
The third relationship activity in building a strategic alliance is labeled as initiating. It involves bringing key
executives into action and creating trust through face-to-face time. Refer to Exhibit 12.3-Building Strategic
Alliances.
 
78. Which of the following primary relationship activities in building strategic alliances involves facilitating the
creation of personal relationships at many levels, traveling to partner facilities and engaging in technical
conversations, and blending social and business time? 
 

A.  Imaging
B.  Initiating
C.  Interfacing
D.  Dating
E.  Committing
The fourth relationship activity in building a strategic alliance is labeled as interfacing. It involves
facilitating the creation of personal relationships at many levels, traveling to partner facilities and engaging
in technical conversations, and blending social and business time. Refer to Exhibit 12.3-Building Strategic
Alliances.
 
79. Which of the following relationship skills is necessary during the imaging activity of building a strategic
alliance? 
 

A.  Good relationship self-awareness

B.  Creating intimacy
C.  Trust building
D.  Partnering
E.  Commitment
Seeing the reality in possibilities, creating a shared vision from being together, and involving trusted senior
managers are actions taken during the imaging stage of building a strategic alliance. These actions require
the key relationship skill of creating intimacy. Refer to Exhibit 12.3-Building Strategic Alliances.
 
80. Which of the following relationship skills is necessary during the initiating activity of building a strategic
alliance? 
 

A.  Commitment
B.  Partnering
C.  Trust building
D.  Creating intimacy
E.  Good relationship self-awareness
The third relationship activity in building a strategic alliance is labeled as initiating. It involves bringing key
executives into action and creating trust through face-to-face time. These actions require the key relationship
skill of trust building. Refer to Exhibit 12.3-Building Strategic Alliances.
 
81. Which of the following relationship skills is necessary during the interfacing activity of building a strategic
alliance? 
 

A.  Trust building

B.  Creating intimacy
C.  Good relationship self-awareness
D.  Commitment
E.  Partnering
The fourth relationship activity in building a strategic alliance is labeled as interfacing. It involves
facilitating the creation of personal relationships at many levels, traveling to partner facilities and engaging
in technical conversations, and blending social and business time. These actions require the key relationship
skill of partnering. Refer to Exhibit 12.3-Building Strategic Alliances.
 
82. Which of the following refers to two or more participating companies joining forces to create a separate
legal entity to facilitate doing business in the international arena? 
 

A.  Indirect exporting

B.  Franchise
C.  License arrangement
D.  Joint venture
E.  Direct investment agreement
A joint venture is different from other types of strategic alliances or collaborative relationships in that a joint
venture is a partnership of two or more participating companies that have joined forces to create a separate
legal entity.
 
83. _____ refers to a partnership of two or more participating companies that have joined forces to create a
separate legal entity to facilitate doing business in a country where none of the participants are currently
active. 
 

A.  A consortium
B.  A franchise pact
C.  A license arrangement
D.  Indirect exporting
E.  Direct foreign investment
Consortia are similar to joint ventures and could be classified as such except for two unique characteristics:
(1) They typically involve a large number of participants and (2) they frequently operate in a country or
market in which none of the participants are currently active.
 
84. A consortium is different from a joint venture in that a consortium: 
 

A.  usually operates in a country in which the participants are already active.
B.  typically involves a large number of participants.
C.  restricts the right to hold an equity position by its major partners.
D.  does not involve the creation of a separate legal entity.
E.  is formed mainly for executing short-term projects.
Four characteristics define joint ventures (JVs): (1) JVs are established, separate, legal entities; (2) they
acknowledge intent by the partners to share in the management of the JV; (3) they are partnerships between
legally incorporated entities, such as companies, chartered organizations, or governments, and not between
individuals; and (4) equity positions are held by each of the partners. Consortia are similar to joint ventures
and could be classified as such except for two unique characteristics: (1) They typically involve a large
number of participants and (2) they frequently operate in a country or market in which none of the
participants is currently active.
 
85. A joint venture is different from a consortium in that a joint venture: 
 

A.  usually operates in a country in which the participants are already present.
B.  typically involves a large number of participants.
C.  restricts the right to hold an equity position by its major partners.
D.  does not involve the creation of a separate legal entity.
E.  is formed mainly for executing short-term projects.
Four characteristics define joint ventures (JVs): (1) JVs are established, separate, legal entities; (2) they
acknowledge intent by the partners to share in the management of the JV; (3) they are partnerships between
legally incorporated entities, such as companies, chartered organizations, or governments, and not between
individuals; and (4) equity positions are held by each of the partners. Consortia are similar to joint ventures
and could be classified as such except for two unique characteristics: (1) They typically involve a large
number of participants and (2) they frequently operate in a country or market in which none of the
participants is currently active.

 
86. Devonaile Inc. is a small-scale apparel manufacturer in Florida. Devonaile and other similar firms from
Florida collaborate and form a separate company in India as none of the participants in this collaboration
have active operations in the Indian market. The newly created firm primarily manufactures apparel suited
to the tastes and preferences of the Indian customers. Identify the type of foreign market-entry approach
depicted in this scenario. 
 

A.  A franchising agreement

B.  A consortium
C.  A licensing agreement
D.  Direct exporting
E.  Indirect exporting
In this case, Devonaile Inc. and the other firms from Florida have formed a consortium. Consortia are
similar to joint ventures and could be classified as such except for two unique characteristics: (1) They
typically involve a large number of participants and (2) they frequently operate in a country or market in
which none of the participants is currently active. Consortia are developed to pool financial and managerial
resources and to lessen risks.
 
87. Companies that adopt the _____ structure are generally experiencing rapid growth and have broad, diverse
product lines. 
 

A.  global product division

B.  pyramid
C.  hierarchical
D.  geographical division
E.  matrix organization
Companies that adopt the global product division structure are generally experiencing rapid growth and
have broad, diverse product lines.

 
88. MedUmbrella Inc. provides a broad and diverse range of services for the healthcare industry. It also
manufactures a wide variety of hospital equipment. It wants to experience rapid growth and intends to have
an organizational structure to better face global competition. Which of the following organizational
structures will suit MedUmbrella best? 
 

A.  A global product division structure

B.  A geographical division structure
C.  A matrix structure
D.  A pyramid structure
E.  A hierarchical structure
In this case, a global product division structure will best suit MedUmbrella Inc. Companies that adopt the
global product division structure are generally experiencing rapid growth and have broad, diverse product
lines.

 
89. Which of the following organizational structures is the most extensive of those usually adopted by
companies? 
 

A.  Transnational structure

B.  Geographical division structure
C.  Region-specific structure
D.  Global product division structure
E.  Matrix structure
The matrix form—the most extensive of the three organizational structures—is popular with companies as
they reorganize for global competition.