This Document Contains Chapters 10 to 12 Chapter 10: Marketing Organization, Implementation, and Control TRUE/FALSE 1. The basic functions of an organization include providing a route and locus of decision making and coordination. Answer: True 2. The share of international operations in the sales and profits of a corporation is so huge in the initial stages of international involvement that organizational adjustment takes place immediately. Answer: False 3. International divisions best serve firms with numerous products that vary significantly in terms of their environmental sensitivity. Answer: False 4. Global structures have grown out of competitive necessity. Answer: True 5. An approach to organizational structure that gives worldwide responsibility to strategic business units for the marketing of their product lines is known as product differentiation. Answer: False 6. Regional integration continues to play a major role in area restructuring. Answer: True 7. The functional structure works best when both products and customers are relatively large and different in nature. Answer: False 8. Organizational matrices vary in terms of their areas of emphasis and the number of dimensions. Answer: True 9. Transnational structures need to build economies of scale without being locally adaptive. Answer: False 10. Given the size of emerging markets like China and India, a high level of localization precludes economies of scale. Answer: False 11. In decentralized systems, strategic decision making is concentrated at headquarters. Answer: False 12. Companies that market consumer products typically have product organizations with low degrees of decentralization. Answer: False 13. Companies that market technologically sophisticated products display centralized organizations with worldwide product responsibilities. Answer: True 14. In virtual centers of excellence, the core individuals live and work around the world and keep in touch through electronic means and meetings. Answer: True 15. Country organizations should be treated exclusively as a source of demand. Answer: False 16. Implementers provide the opportunity to capture economies of scale and scope. Answer: True 17. A contributor is a country organization with a distinctive competence, such as product development or regional expertise. Answer: True 18. The budget and planning process is the major control instrument in headquarters-subsidiary relationships. Answer: True 19. The content of budgets are more qualitative and judgmental in nature than that of long-range plans. Answer: False 20. The choice of bureaucratic controls rather than cultural controls can be justified if the company enjoys a low turnover rate. Answer: False MULTIPLE CHOICE 1. Which of the following is true about the early stages of international involvement in firms with little or no formal organization? a. All transactions are subject to a single standardized procedure. b. Domestic operations assume responsibility for international marketing activities. c. Consolidation of information and authority over international sales is undertaken. d. The share of international operations in the sales of the corporation is initially high. Answer: B 2. The ____________ centralizes in one entity, with or without separate incorporation, and accepts all of the responsibility for worldwide activities. a. export department structure b. global division c. international division d. hybrid structure Answer: C 3. Which of the following is true about international divisions? a. The international division centralizes in several entities, without separate incorporation, and accepts all of the responsibility for international activities. b. To avoid situations in which the international division is at a disadvantage in competing for production and related services, corporations need to coordinate between domestic and international operations. c. The international division best serves firms with several products that vary significantly in terms of their environmental sensitivity, and when international sales and profits are quite significant compared with those of the domestic divisions. d. The international division concentrates solely on manufacturing functions in order to take advantage of the economies of scale. Answer: B 4. Which of the following global structures improves cost efficiency through centralization of manufacturing facilities? a. Global functional structure b. Global customer structure c. Global product structure d. Global mixed structure Answer: C 5. Which of the following is an approach to organizational structure that gives worldwide responsibility to strategic business units for marketing their product lines? a. Area structure b. Functional structure c. Mixed structure d. Product structure Answer: D 6. All-Techno Inc., a leading Florida-based software firm, has branches all over the world. Its operations are mainly divided into three regions comprising Europe, Asia, and the U.S. These divisions are responsible for all the manufacturing and marketing activities in their respective areas. What kind of organizational structure is being adopted by All-Techno? a. Product structure b. Functional structure c. Area structure d. Customer structure Answer: C 7. If market conditions with respect to product acceptance and operating conditions vary dramatically, the ____________ approach is the one to choose. a. functional b. customer c. product d. area Answer: D 8. An approach to organizational structure that is based on which consumer groups are served is referred to as a(n) ____________. a. functional structure b. area structure c. customer structure d. product structure Answer: C 9. A(n) ____________ structure combines two or more organizational dimensions simultaneously. a. matrix b. functional c. area d. mixed Answer: D 10. Which approach to organizational structure refers to a business driven by a worldwide business unit and implemented by a geographic unit? a. Mixed structure b. Matrix structure c. Functional structure d. Shell structure Answer: B 11. Which of the following best describes matrix structures? a. It is a structure in which product divisions are responsible for all manufacturing and marketing worldwide. b. It is a structure in which geographic divisions are responsible for all manufacturing and marketing in their respective areas. c. It is a structure driven by a worldwide business unit and implemented by a geographic unit. d. It is a structure that combines two or more organizational dimensions simultaneously. Answer: C 12. If subsidiaries are granted a high degree of autonomy, the result is termed ____________. a. bureaucratic structures b. mechanistic organizations c. decentralization d. centralization Answer: C 13. A firm is said to be ____________ when it maintains tight controls and its strategic decision making is concentrated at headquarters. a. glocalized b. cross-subsidized c. centralized d. decentralized Answer: C 14. Allowing maximum flexibility at the country-market level takes advantage of the fact that subsidiary management: a. will eventually move into a black hole situation. b. knows its market and can react to changes quickly. c. can reinvent solutions that have already been discovered. d. will eventually let headquarters make all decisions. Answer: B 15. Marketers faced with global competitive threats and opportunities have adopted global strategy formulation which requires some degree of centralization. This has resulted in ____________. a. coordinated decentralization b. centralized coordination c. national autonomy d. central control Answer: A 16. The organizational structure and locus of decision making in multinational corporations are determined by a number of factors. Which of the following is NOT one of those factors? a. The degree of involvement in international operations b. The demographic characteristics of customers in each region c. The business in which the firm is engaged d. The human resource capability of the firm Answer: B 17. ____________ refers to the organizational approach that provides clear global strategic direction along with the flexibility to adapt to local opportunities and requirements. a. Globalization b. Glocalization c. Decentralization d. Segmentation Answer: B 18. Companies that have adopted the glocalization approach incorporate all of the following dimensions EXCEPT: a. the development and communication of a clear corporate vision. b. the effective management of human resource tools to broaden individual perspectives. c. the integration of individual thinking and activities into the broad corporate agenda. d. the policy of reinventing solutions that have already been discovered. Answer: D 19. ____________ centers of excellence are individuals who are internationally recognized for their expertise in a function or an area. a. Concentrated b. Strategic c. Charismatic d. Virtual Answer: C 20. Which of the following is true about centers of excellence? a. Charismatic centers of excellence aim to build through an expert a capability in the firm that has been lacking. b. Focused centers of excellence consider all areas of expertise and give equal importance to each one of them. c. In virtual centers of excellence, the core individuals live and work near the firm, and avoid all forms of electronic means to communicate. d. In virtual centers of excellence, all forms of knowledge are kept confidential within the firm. Answer: A 21. Which of the following statements is true about promoting global internal cooperation? a. Global business entities believe that wherever the individual participants may be, relying solely on technology brings about the desired results. b. Global business entities require that intellectual capital be kept confidential within the organization. c. To promote internal cooperation in the case of a new program, final direction comes from local-country managers who also develop the global strategy. d. A method to promote internal cooperation for global strategy implementation is the use of international teams or councils. Answer: D 22. ____________ refer(s) to integrating a company’s information assets into a single, globally accessible system that allows more efficient collaboration and the formation of virtual teams. a. Intranets b. E-commerce c. E-info system d. Internet Answer: A 23. Which of the following is true of intranets? a. It enhances knowledge capital, which can be constantly updated and upgraded. b. There is a time lag between an idea and the information needed to assess and implement it c. It provides teamwork-enabling online communication at high costs. d. It is low on technological feasibility which allows managers to make to-the-minute decisions anywhere in the world. Answer: A 24. The role of a(n) ____________ can be played by a highly competent national subsidiary located in a strategically critical market. a. contributor b. black hole c. implementer d. strategic leader Answer: D 25. CruzAuto Inc., a leading American automobile manufacturer, has a joint venture with an Italian automobile firm to manufacture automobiles which are designed specifically for the Italian market. The Italian management team therefore plays the role of a(n) ____________ in CruzAuto’s global planning. a. implementer b. strategic leader c. contributor d. dodger Answer: B 26. A ____________ is a country organization with a distinctive competence, such as product development or regional expertise. a. shell corporation b. contributor c. contender d. dodger Answer: B 27. A country organization that exists in a smaller, less-established markets in which corporate commitment to market development is lower is called a(n) ____________. a. contributor b. strategic leader c. shell corporation d. implementer Answer: D 28. TechPro Inc., a leading laptop manufacturing company, manufactures all of its products at its branch in San Diego. It has other branches located in India, China, and Singapore where corporate commitment to market development is lower. TechPro configures the laptops before selling them to customers in these regions. Which of the following roles do the country organizations in these regions play? a. Implementers b. Contributors c. Strategic leaders d. Dodgers Answer: A 29. Which of the following is true about the role of country organizations? a. The role of strategic leader can be played by a highly competent national subsidiary located in a minor, less relevant market. b. Implementers provide the opportunity to capture economies of scale and scope that are the basis of a global strategy. c. International marketers prefer to be in black hole situations. d. A contributor is a country organization with ordinary competencies similar to the other country organizations. Answer: B 30. Which of the following is a “black hole” situation? a. A situation in which international direct investors are accused of draining resources from their host countries b. An organization with tight controls and whose strategic decision making is concentrated at headquarters c. A situation in international marketing when the market has been read incorrectly d. A situation where the government of a country permits all the activities of a foreign company in that country Answer: C 31. ____________ controls consist of a limited and explicit set of regulations and rules that outline desired levels of performance. a. Bureaucratic b. Contributor c. Implementer d. Cultural Answer: A 32. ____________ are less formal than other controls and are the result of shared beliefs and expectations among the members of an organization. a. Bureaucratic controls b. Centralized organizations c. Cultural controls d. Differentiation strategies Answer: C 33. Short-term financial guidelines in such areas as investment, cash, and personnel are called ____________. a. budgets b. credits c. plans d. regulations Answer: A 34. ____________ are formalized, long-range programs with more than a one-year horizon. a. Tasks b. Objectives c. Plans d. Schedules Answer: C 35. Which of the following is true about controls? a. The content of long-range plans is more qualitative and judgmental in nature than that of budgets. b. Bureaucratic controls are less formal than other controls and are the result of shared beliefs and expectations among the members of an organization. c. The choice of bureaucratic controls rather than cultural controls can be justified if the company enjoys a low turnover rate. d. Cultural controls consist of a limited and explicit set of regulations and rules that outline desired levels of performance. Answer: A ESSAY 1. What are the three organizational designs that make up international organizational structures? Answer: The types of structures that companies use to manage foreign activities can be divided into three categories based on the degree of internationalization. 1. Little or no formal organizational recognition of international activities of the firm: This category ranges from domestic operations handling an occasional international transaction on an ad hoc basis to separate export departments. 2. International division: Firms in this category recognize the ever-growing importance of international involvement. 3. Global organizations: These can be structured by product, area, function, process, or customer. 2. Describe the different types of centers of excellence. Answer: Centers of excellence can emerge in three formats: charismatic, focused, or virtual. Charismatic centers of excellence are individuals who are internationally recognized for their expertise in a function or an area. The objective is primarily to build through an expert, via a mentoring relationship, a capability in the firm that has been lacking. The most common types are focused centers of excellence that are based on a single area of expertise, be it technological or product-based. The center has an identifiable location from which members provide advice and training. In virtual centers of excellence, the core individuals live and work around the world and keep in touch through electronic means and meetings. The knowledge of dispersed individuals is brought together, integrated into a coherent whole, and disseminated throughout the firm. 3. Differentiate between bureaucratic and cultural controls. Answer: Bureaucratic controls consist of a limited and explicit set of regulations and rules that outline desired levels of performance. Cultural controls, on the other hand, are much less formal and are the result of shared beliefs and expectations among the members of an organization. Cultural controls require an extensive socialization process, and informal, personal interaction is central to the process. The elements of bureaucratic or formalized controls are (1) an international budget and planning system, (2) the functional reporting system, and (3) policy manuals used to direct functional performance. The primary instruments of cultural control are the careful selection and training of corporate personnel and the institution of self-control. The choice of cultural controls rather than bureaucratic controls can be justified if the company enjoys a low turnover rate. Chapter 11: Product Management and Global Brands TRUE/FALSE 1. Making a profit is the key to successful marketing. Answer: False 2. The core of a firm's international operations is pricing. Answer: False 3. In order to differentiate a product, a marketer tries to highlight the similarities it has with products in the same class so as to highlight the likenesses of each. Answer: False 4. Adaptation decisions are made to enhance the exporter’s competitiveness in the marketplace. Answer: True 5. The more exporters learn about local market characteristics in individual markets, the more they are able to establish similarities and, as a result, customize their marketing approach, especially across similar markets. Answer: False 6. Nontariff barriers include product standards, testing or approval procedures, subsidies for local products, and bureaucratic red tape. Answer: True 7. The characteristics and behavior of intended customer groups are as important as governmental influences on the product adaptation decision. Answer: True 8. Positioning is the physical space a product assumes on a store shelf, and companies pay huge sums of money to have their products first in line. Answer: False 9. Reverse innovation is when a company produces a drastically simplified version of a product due to lack of purchasing power or usage conditions. Answer: True 10. Consumer nondurables, such as food products, generally show the highest amount of sensitivity toward differences in national tastes and habits. Answer: True 11. Industrial products tend to be more shielded from cultural influences than consumer durables. Answer: True 12. The brand mark is the vocalizable part of the brand, the brand name the nonvocalizable part. Answer: False 13. Color plays an important role in the way consumers perceive a product. They communicate in a subtle way in developed societies; they have direct meaning in more traditional societies. Answer: True 14. Product warranties can be effective promotional tools. Answer: True 15. When the country of origin does matter to consumers, it is in the exporter’s best interest to monitor consumers’ perceptions. Answer: True 16. Most companies aim for consistency in their marketing efforts. An example of where consistency may be easy to achieve in international markets is in the area of warranties. Answer: False 17. The main goal of the product development process is to develop a standard product or product line. Answer: False 18. The value of brands can be seen on balance sheets. Answer: False 19. The practice of product counterfeiting has spread to high-technology products and services from the traditionally counterfeited products: high-visibility, strong-brand-name consumer goods. Answer: True 20. The Trademark Counterfeiting Act of 1984 made trading in goods and services using a counterfeit trademark a civil rather than a criminal offense. Answer: False MULTIPLE CHOICE 1. Which of the following best describes the product or service a company offers for sale? a. A pertinent formation of space and time b. A complex combination of tangible and intangible elements c. A tangible benefit d. An intangible offering Answer: B 2. Differentiation is a marketing method to: a. get different customers to try the product. b. create an image or a perception in the minds of competitors. c. dilate the market forces with excessive distribution. d. help consumers distinguish between competing brands. Answer: D 3. When the core product is relatively or highly similar between competitors, marketers highlight what type of features to achieve differentiation? a. Augmented b. Core c. Innate d. Fancy Answer: A 4. A customer attaches value to a product in proportion to the: a. price in a competitive framework. b. cost incurred in the production of the product. c. product’s perceived ability to help solve problems. d. income level of the household. Answer: C 5. After-sale services and warranties are the ____________ elements of a product. a. intangible b. augmented c. core d. packaging Answer: B 6. Which of the following is an intangible element of a product? a. Installation b. Aesthetics c. Positioning d. Packaging Answer: C 7. Which of the following is one of the three facts a company should consider when marketing a product abroad? a. The markets that have been targeted b. The domestic policy c. The natural resources available in the home country d. The domestic political system Answer: A 8. What are the prevailing environmental factors over which the international marketer has no control? a. Price, product, and promotion decisions b. Message, money, and media c. Legal, economic, and climatic conditions d. Usage rate, buying patterns, and promotion Answer: C 9. Which of the following is a regional, country, or local characteristic that affects product-adaptation decisions? a. Country of origin b. Competitive offerings c. Market opportunity d. Quality Answer: B 10. Which of the following is a product characteristic that affects product-adaptation decisions? a. Country of origin b. Market opportunity c. Purchase patterns d. Culture Answer: A 11. Which of the following is a company consideration that affects product-adaptation decisions? a. Competitive offerings b. Method of operation c. Durability d. Market opportunity Answer: D 12. Various factors determine the need for either mandatory or discretionary product adaptation. Which of the following factors is a product characteristic? a. Nontariff barriers b. Brand c. Cost of adapting d. Profitability Answer: B 13. What is probably the single most important factor contributing to product adaptation? a. Economic integration b. Situational analysis c. Government regulations d. Primary packaging Answer: C 14. Which of the following is a nontariff barrier? a. Import duty b. Product standards c. Excise duty d. Quotas Answer: B 15. Which of the following affects the product decision of consumer products that also reflects the marketers’ need to gain customers’ approval? a. Purchasing power b. Local behavior c. Boundaries d. Income levels Answer: B 16. Which of the following is a question regarding cultural criteria that affects product adaptation? a. Does the symbolic content of the product or service differ from one country to another? b. Is there a stigma attached to the product or service? c. Do most consumers spend the same amount of time making the purchase? d. Is the psychic cost of purchasing or using the product or service the same, whatever the country? Answer: B 17. Which of the following is a question regarding psychosocial characteristics that affects products adaptation? a. Does society restrict the purchase or use of the product or service to a particular group? b. Does the symbolic content of the product or service differ from one country to another? c. Is there a stigma attached to the product or service? d. Do most consumers expect a product to have the same appearance? Answer: B 18. Which of the following refers to the mental image that a brand, or the company as a whole, evokes in the minds of consumers? a. Innovation b. Social engineering c. Unique selling proposition d. Positioning Answer: D 19. Which category of products generally show the highest amount of sensitivity toward differences in national tastes and habits? a. Industrial goods b. Consumer nondurables c. Business products d. Consumer durables Answer: B 20. The use of ____________ in branding is strongest in culturally similar markets. a. standardization b. differentiation c. customization d. segmentation Answer: A 21. Which of the following is true about brands? a. It allows customization of promotional items. b. It conveys the image of the product or service. c. It is always listed on balance sheets. d. It is used only by apparel companies. Answer: B 22. ____________ are one of the most easily standardized items in the product offering. a. Brands b. Services c. Values d. Prices Answer: A 23. Which of the following terms refers to the legally protected part of the brand? a. Intellectual property b. Trademark c. Brand mark d. Copyright Answer: B 24. Which of the following means using a foreign-language name for a brand? a. Transculture b. Transparency c. Transliteration d. Translation Answer: A 25. ____________ can be used to develop a new, essentially meaningless brand name to minimize trademark complexities. a. Translation b. Transparency c. Transculture d. Transliteration Answer: B 26. ____________ requires the testing of an existing brand name for connotative meaning in the language of the intended market. a. Translation b. Transliteration c. Transparency d. Transculture Answer: B 27. ____________ serves three major functions: protection, promotion, and user convenience. a. Labeling b. Packaging c. Branding d. Positioning Answer: B 28. Which of the following is one of the major functions of packaging? a. Testing b. Segmentation c. Feedback d. User convenience Answer: D 29. The promotional aspect of packaging relates mostly to ____________. a. labeling b. color c. size d. weight Answer: A 30. With regard to the packaging dimension, the four Rs comprise of redesign, reduce, recycle, and ____________. a. redefine b. reinforce c. realign d. reuse Answer: D 31. What is the first step in the product development process? a. Process development b. Feedback c. Idea generation d. Scale-up Answer: C 32. In a typical global program management, the affected units have prime responsibility for achieving ____________. a. single-point worldwide technical development and design of a new product that conforms to the global design standard b. all activities necessary to support the product in the affected unit, as well as direction and support to managing units to ensure that concurrent introductions are achieved c. identification of unique requirements to be incorporated in the product goals and specifications d. integration and coordination of all global program activities Answer: C 33. Any good bearing an unauthorized representation of a trademark, patented invention, or copyrighted work that is legally protected in the country where it is marketed is known as a ____________. a. replica b. me-too product c. counterfeit d. hand-me-down Answer: C 34. Which legislation amended Section 301 of the Trade Act of 1974 to clarify that the violation of intellectual property rights is an unreasonable practice within the statute? a. The Fair Trade Act of 1984 b. The Intellectual Property Protection Act of 1984 c. The Trademark Counterfeiting Act of 1984 d. The Omnibus Tariff and Trade Act of 1984 Answer: D 35. Which legislation requires the U.S. trade representative to set country-specific negotiating objectives for reciprocity and consideration of retaliatory options to ensure intellectual property protection? a. The Fair Trade Act b. The Intellectual Property Rights Improvement Act c. The Trademark Counterfeiting Act d. The Omnibus Tariff and Trade Act Answer: B ESSAY 1. What are the factors affecting adaptation? Answer: In deciding the form in which the product is to be marketed abroad, the firm should consider three sets of factors: (1) the market(s) that have been targeted, (2) the product and its characteristics, and (3) company characteristics, such as resources and policy. For most firms, the key question linked to adaptation is whether the effort is worth the cost involved. For most firms, the expense of modifying products should be moderate. 2. What are the reasons for making investment on R&D abroad? Answer: Investments for R&D abroad are made for four general reasons: (1) to aid technology transfer from parent to subsidiary, (2) to develop new and improved products expressly for global markets, (3) to develop new products and processes for simultaneous application in world markets of the firm, and (4) to generate new technology of a long-term, exploratory nature. 3. Explain how counterfeiting has become a problem in foreign markets. Answer: Counterfeiting problems occur in three ways and, depending on the origin of the product and where they are marketed, require different courses of action. Enforcement has been problematic because of the lack of adequate personnel and the increasingly high-tech character of the products. The theft of intellectual property is a critical problem for many industries and countries, accelerating with the pace of market globalization. Governments have long argued about intellectual property protection, but the lack of results in some parts of the world has forced companies themselves to take action on this front. Chapter 12: Global Marketing of Services TRUE/FALSE 1. Services are typically distributed through various intermediaries. Answer: False 2. Services differ from goods as services are tangible. Answer: False 3. Services are highly perishable. Answer: True 4. The human element in the offering of goods takes on a much greater role than in the service offering. Answer: False 5. Production lines cannot be established to deliver an identical service each time. Answer: True 6. Telecommunication is a part of infrastructure services. Answer: True 7. A trade surplus occurs if imports are greater than exports. Answer: False 8. Deregulation results in decreased competitive activity. Answer: False 9. Nondiscriminatory regulations refer to regulations that impose larger operating costs on foreign service providers than on the local competitors. Answer: False 10. Nondiscriminatory regulations do not hamper business operations. Answer: False 11. Nondiscriminatory regulations offer less opportunity for international criticism. Answer: True 12. Barriers to services destined for the U.S. market result mainly from regulatory practices. Answer: True 13. The United States places less severe restrictions on foreign countries than do other countries. Answer: False 14. The penetration of the Internet has occurred at different rates in different countries. Answer: True 15. A unilingual website helps in accessing more new customers as compared to a multilingual website. Answer: False 16. English is the most common website language. Answer: True 17. The most popular destination point for U.S. students is Europe. Answer: True 18. Economies of scale do not work for areas such as personnel management. Answer: False 19. Service providers whose activities are independent from goods must search for market situations abroad that are different from the domestic market. Answer: False 20. Health care is a tangible action. Answer: True MULTIPLE CHOICE 1. Unlike goods, services ____________. a. cannot be transferred through intermediaries b. are tangible c. can be easily stored d. are possessed rather than consumed Answer: A 2. Which of the following is a feature of services? a. There is no customer involvement in production. b. Time of production is different from time of consumption. c. They can be stored for peak demand. d. They are highly perishable. Answer: D 3. Services cannot be stored because of their ____________. a. tangibility b. perishability c. consistency d. market transparency Answer: B 4. Services are consumed rather than possessed because of their ____________. a. customer involvement b. market transparency c. perishability d. intangibility Answer: D 5. Once a plane has taken off, selling an empty seat is virtually impossible because of the ____________ of services. a. market transparency b. service consistency c. perishability d. intangibility Answer: C 6. ____________ contradicts a firm’s desire to standardize its offering. a. Customer interaction b. Service consistency c. Imperishability d. Market transparency Answer: A 7. The time of production of a service is very close to the time of consumption. This requires ____________. a. tangibility b. constant maintenance of service capacity c. close customer involvement d. more market transparency Answer: C 8. Services are often custom made because of ____________. a. market transparency b. close interaction with customers c. tangibility d. high imperishability Answer: B 9. To offer a service in real time, the firm requires ____________. a. market transparency b. regulatory practices c. positive quality perception d. service consistency Answer: D 10. If the details of the service are clear, comparable, and available to all interested parties, the seller of the service is said to have provided ____________. a. service consistency b. market transparency c. service capacity d. imperishability Answer: B 11. The effect of a teacher’s lecture varies from one student to another. This illustrates the ____________ of services. a. intangibility b. consistency c. heterogeneity d. perishability Answer: C 12. Which of the following characteristics of a service does not allow sellers to choose multitiered and long traditional channels of distributions to sell their services? a. Perishability b. Intangibility c. Heterogeneity d. Market transparency Answer: A 13. A weather news service either reaches its audience quickly or rapidly loses its value. Which of the following characteristics of a service does this illustrate? a. Market transparency b. Intangibility c. Perishability d. Heterogeneity Answer: C 14. ____________ services are comprised of telecommunications, insurance, banking, and logistics. a. Media b. Accounting c. Agricultural d. Infrastructure Answer: D 15. Which of the following is an example of infrastructural services? a. Teaching b. House cleaning c. Radio d. Logistics Answer: D 16. A(n) ____________ occurs if imports are greater than exports. a. trade surplus b. trade deficit c. currency crisis d. export surplus Answer: B 17. A(n) ____________ is a positive difference between exports and imports. a. trade surplus b. trade deficit c. currency crisis d. import surplus Answer: A 18. Reduction of governmental control of services is known as ____________. a. deregulation b. globalization c. dematerialization d. monopolization Answer: A 19. ____________ is one of the primary deregulated industries in the United States. a. Law b. Health care c. Transportation d. Media Answer: C 20. Deregulation ____________. a. increases monopolistic tendencies b. results in lower prices c. disrupts competitive activities d. leads to increase in government interference Answer: B 21. Which of the following steps is taken by the government to enhance competitive activities? a. Disinvestment b. Deregulation c. Monopolization d. Dematerialization Answer: B 22. ____________ of services makes it difficult to gather information. a. Comparability b. Homogeneity c. Intangibility d. Market transparency Answer: C 23. Which of the following is true of nondiscriminatory regulations? a. They provide subsidies to local firms only. b. They offer more opportunity for international criticism. c. They are more convenient for local business than for foreign service providers. d. They hamper business operations. Answer: D 24. Barriers to services destined for the U.S. market result mainly from ____________. a. sustainable practices b. regulatory practices c. globalization d. monopolization Answer: B 25. Which of the following is true of regulatory practices in the United States? a. These practices do not regulate banking and insurance industries. b. These practices impose nondiscriminatory regulations. c. The United States does not pose formidable barriers to potential entrants from abroad. d. The United States imposes more restrictions on foreign service providers than do other countries. Answer: D 26. Which of the following is true of discriminatory regulations? a. They impose larger operating costs on foreign service providers than on the local competitors. b. They provide subsidies to foreign service providers. c. They encourage competitive opportunities to foreign suppliers. d. They offer less opportunity for international criticism. Answer: A 27. Which of the following is an advantage of E-commerce? a. It does not require customization of websites. b. It saves travel costs. c. It does not require a multilingual website. d. It is equally accessible to people in all parts of the world. Answer: B 28. Which of the following is true about E-commerce? a. It is expensive. b. It is not a feasible option for small firms. c. It is not useful in gaining credibility in international markets. d. It requires customized and multilingual websites. Answer: D 29. ____________ has/have led to the emergence of financial giants in Europe, Japan, and the United States. a. Increased mergers and acquisitions b. Increased monopolization c. Decreased globalization d. Decreased disinvestment and electronic commerce Answer: A 30. Which of the following involves a tangible action? a. Accounting b. Fitness center c. Advertising d. Legal services Answer: B 31. Which of the following is an example of people processing? a. Restaurant b. Disposal c. Refueling d. Banking Answer: A 32. Which of the following is an example of possessions processing? a. Gardening b. Lodging c. Physical therapy d. Music concerts Answer: A 33. Which of the following involves an intangible action? a. Retail b. Recycling c. Warehousing d. Broadcasting Answer: D 34. Which of the following is an example of mental stimulus processing? a. Insurance b. Storage c. Education d. Banking Answer: C 35. Which of the following is an example of information processing? a. Education b. Religion c. Lodging d. Programming Answer: D ESSAY 1. Explain any three characteristics of a service. Answer: The characteristics of services are as follows: 1. Intangibility - Services are mostly intangible. They are frequently consumed rather than possessed. Even though the intangibility of services is a primary differentiating criterion, it is not always present. For example, publishing services ultimately result in a tangible good, namely a book or an article. 2. Perishability - Because of their nature, services are difficult to inventory. If they are not used, the “brown around the edges” syndrome tends to result in high services perishability. Unused capacity in the form of an empty seat on an airplane, for example, becomes nonsalable quickly. 3. Customer involvement - For many service offerings, the time of production is very close to or even simultaneous with the time of consumption. This fact points toward close customer involvement in the production of services. Customers frequently either service themselves or cooperate in the delivery of services. 2. Write a brief note on deregulation. Answer: In the mid-1970s, many governments made a philosophical decision in favor of deregulation, which reduced government interference in the marketplace, in the hope that this would enhance competitive activity. Some service sectors have benefited, and others have suffered, from the withdrawal of government intervention. The primary deregulated industries in the United States have been transportation, banking, and telecommunications. As a result, new competitors participate in the marketplace. Regulatory changes were initially thought to have primarily domestic effects, but they have rapidly spread internationally. For example, the 1984 deregulation of AT&T has given rise to the deregulation of Japan’s telecommunications monopoly, NTT. European deregulation followed in the mid-1990s. 3. What are the advantages of multilingual websites? Answer: Ten reasons for having a multilingual website are to: 1. Facilitate a shift toward non-English-speaking Internet users 2. Use as a cost-effective marketing tool 3. Access new customers 4. Increase sales with little investment 5. Demonstrate that the company is customer-centric 6. Generate trust by providing services in a customer’s native language 7. Demonstrate cultural sensitivity 8. Beat competition 9. Show that company thinks, works, and deals internationally 10. Be picked up by more search enginesTest Bank for International Marketing Michael R. Czinkota, Ilkka A. Ronkainen 9781133627517, 9788131533642
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