ACC 565 Week 5 Midterm Exam – Strayer NEW
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Chapters 1 Through 7
Chapter 1 Tax Research
1) Tax planning is not an integral part of open-fact situations.
Page Ref.: C:1-2
Objective: 1
2) The Internal Revenue Code of 1986 contains the current version of the tax law.
Page Ref.: C:1-8
Objective: 4
3) Regulations issued prior to the latest tax legislation dealing with a specific Code section are still effective to the extent they do not conflict with the provisions in the new legislation.
Page Ref.: C:1-9
Objective: 4
4) Final regulations have almost the same legislative weight as the IRC.
Page Ref.: C:1-10
Objective: 4
5) A revenue ruling is issued by the Internal Revenue Service only in response to a verbal inquiry by a taxpayer.
Page Ref.: C:1-12
Objective: 4
6) Taxpayers must pay the disputed tax prior to filing a case with the Tax Court.
Page Ref.: C:1-14
Objective: 4
7) Appeals from the U.S. Tax Court are to the Court of Appeals for the Federal Circuit.
Page Ref.: C:1-14
Objective: 4
8) Appeals from the Court of Appeals go to the Supreme Court under a writ of certiorari. The Supreme Court decides whether or not they will hear the case.
Page Ref.: C:1-14
Objective: 4
9) A citator enables tax researchers to locate authorities (e.g., cases and IRS pronouncements) that have cited a particular case.
Page Ref.: C:1-30
Objective: 7
10) According to the Statements on Standards for Tax Services, CPAs must verify all tax return information submitted by reviewing client documentation.
Page Ref.: C:1-33
Objective: 8
11) When a taxpayer contacts a tax advisor requesting advice as to the most advantageous way to dispose of a stock, the tax advisor is faced with
A) a restricted-fact situation.
B) a closed-fact situation.
C) an open-fact situation.
D) a recognized-fact situation.
Page Ref.: C:1-2
Objective: 1
12) Investigation of a tax problem that involves a closed-fact situation means that
A) the client's transactions have already occurred and the tax questions must now be resolved.
B) the client's tax return has yet to be filed.
C) future events may be planned and controlled.
D) research is primarily concerned with applying the law to the facts as they exist.
Page Ref.: C:1-2
Objective: 1
13) Identify which of the following statements is true.
A) Tax planning is an integral part of both closed-fact situations and open-fact situations.
B) The first step in conducting tax research is to clearly understand the issues involved.
C) The Statements on Standards for Tax Services recommend that only written tax advice be provided to the client in all situations.
D) All of the above are false.
Page Ref.: C:1-5
Objective: 2
14) The term "tax law" includes
A) legislation.
B) treasury regulations.
C) judicial decisions.
D) all of the above
Page Ref.: C:1-7
Objective: 4
15) Identify which of the following statements is false.
A) When tax advisors speak of the "tax law," they usually have in mind just the Internal Revenue Code.
B) Members from both the House and the Senate are on the Conference Committee.
C) Records of committee hearings are helpful in determining Congressional intent.
D) All of the above are false.
Page Ref.: C:1-7
Objective: 4
16) The committee that is responsible for holding hearings on tax legislation for the House of Representatives is the
A) Finance Committee.
B) Joint Committee on Taxation.
C) Conference Committee.
D) Ways and Means Committee.
Page Ref.: C:1-7
Objective: 4
17) A tax bill introduced in the House of Representatives is then
A) referred to the House Ways and Means Committee for hearings and approval.
B) referred to the entire House for hearings.
C) voted upon by the entire House.
D) forwarded to the Senate Finance Committee for consideration.
Page Ref.: C:1-7
Objective: 4
18) The Senate equivalent of the House Ways and Means Committee is the Senate
A) Finance Committee.
B) Ways and Means Committee.
C) Tax Committee.
D) Joint Conference Committee.
Page Ref.: C:1-7
Objective: 4
19) Which of the following steps, related to a tax bill, occurs first?
A) signature or veto by the President of the United States
B) consideration by the Senate Finance Committee
C) consideration by the entire Senate
D) consideration by the House Ways and Means Committee
Page Ref.: C:1-7
Objective: 4
20) When the House and Senate versions of a tax bill are not in agreement, the disagreements are resolved by the
A) Ways and Means Committee.
B) Mediation Committee.
C) Revenue Committee.
D) Conference Committee.
Page Ref.: C:1-7
Objective: 4
21) Identify which of the following statements is true.
A) Paragraph references are most commonly used when citing or referring to the tax statutes.
B) Title 26 of the United States Code and the Internal Revenue Code of 1986 are synonymous.
C) Before 1939, tax statutes were codified or compiled into one document.
D) The Internal Revenue Code contains chapters, which are further subdivided into titles.
Page Ref.: C:1-8
Objective: 4
22) Title 26 of the U.S. Code includes
A) income tax legislation only.
B) gift tax and estate tax legislation only.
C) alcohol and tobacco tax legislation only.
D) all of the tax legislation mentioned above.
Page Ref.: C:1-8
Objective: 4
23) The tax statutes with the popular name "The Internal Revenue Code of 1986" are contained in which Title of the Code?
A) 20
B) 25
C) 26
D) 301
Page Ref.: C:1-8
Objective: 4
24) Which of the following statements regarding proposed regulations is not correct?
A) Proposed regulations expire after three years.
B) Practitioners and other interested parties may comment on proposed regulations.
C) Proposed and temporary regulations are generally issued simultaneously.
D) Proposed regulations do not provide any insight into the IRS's interpretation of the tax law.
Page Ref.: C:1-9
Objective: 4
25) Final regulations can take effect on any of the following dates except
A) the effective date of the statutory language they interpret, provided they are issued within 18 months of the date of the change to the statute.
B) the date on which final regulations were proposed.
C) the date on which related temporary regulations were first published in the Federal Register.
D) the date on which they were issued in final form.
Page Ref.: C:1-10
Objective: 4
26) When Congress passes a statute with language such as, "The Secretary shall prescribe such regulations as he may deem necessary," the regulations ultimately issued for that statute are
A) congressional regulations.
B) statutory regulations.
C) interpretative regulations.
D) legislative regulations.
Page Ref.: C:1-10
Objective: 4
27) Regulations are
A) equal in authority to legislation.
B) equal in authority to legislation if statutory.
C) presumed to be valid and to have almost the same weight as the IRC.
D) equal in authority to legislation if interpretative.
Page Ref.: C:1-10
Objective: 4
28) Identify which of the following statements is true.
A) If regulations are issued prior to the latest tax legislation dealing with a specific Code section, the regulations are no longer effective to the extent they conflict with the provisions in the new legislation.
B) Legislative regulations are more likely to be invalidated by the courts than are interpretative regulations.
C) Regulations have more authoritative weight than tax statues.
D) All of the above are false.
Page Ref.: C:1-9
Objective: 4
29) Identify which of the following statements is false.
A) The number "5" in the citation Reg. Sec. 1.166-5 refers to the paragraph number.
B) The Cumulative Bulletin is issued semiannually while the Internal Revenue Bulletin is issued weekly.
C) The citation Rev. Rul. 2006-5, I.R.B. 2006-1, 33, indicates that the revenue ruling can be found on page 33 of the 1st I.R.B. for 2006.
D) All of the above are false.
Page Ref.: C:1-11
Objective: 4
30) The number appearing immediately following the decimal place in a regulation citation refers to the
A) general subject matter of the regulation.
B) code section being interpreted.
C) sequential number of the regulation.
D) subsection of the Code section being interpreted.
Page Ref.: C:1-11
Objective: 4
31) The citation "Reg. Sec. 1.199-2" refers to
A) the first regulation issued in 1999.
B) the second regulation issued in 1999.
C) a regulation that interprets Code Section 199.
D) a regulation that can be found on page 199.
Page Ref.: C:1-11
Objective: 4
32) Which regulation deals with Code Section 165?
A) Reg. Sec. 1.165-5
B) Reg. Sec. 165.183-5
C) Reg. Sec. 1.5-165
D) Reg. Sec. 165-5
Page Ref.: C:1-11
Objective: 4
33) Which regulation deals with the gift tax?
A) Reg. Sec. 1.165-5
B) Reg. Sec. 20.2014-5
C) Reg. Sec. 25.2518-5
D) Reg. Sec. 301.7002-5
Page Ref.: C:1-11
Objective: 4
34) Which of the following best describes the weight of a revenue ruling?
A) Revenue rulings carry more weight than regulations.
B) Revenue rulings carry more weight than federal court decisions.
C) Regulations carry more weight than revenue rulings.
D) Revenue rulings should never be used as authority since they only apply to the taxpayer requesting the ruling.
Page Ref.: C:1-12
Objective: 4
35) The citation "Rev. Rul. 2006-8, 2006-1 C.B. 541" refers to
A) the eighth ruling of 2006 found on page 541 in Vol. 1 of the 2006 Cumulative Bulletin.
B) the eighth ruling of 2006 found on page 541 in the 2006 volume of the Cumulative Bulletin.
C) the 541st ruling of 2006 found on page eight in Vol. 1 of the 2006 Cumulative Bulletin.
D) the 1st ruling of 2006 found on page 541 in the 2006 volume of the Cumulative Bulletin.
Page Ref.: C:1-12
Objective: 4
36) Which of the following documents is issued by the IRS to a specific taxpayer?
A) regulation
B) revenue procedure
C) letter ruling
D) information release
Page Ref.: C:
Friday, 3 February 2017
MGT 510 Midterm and Final Exam – Strayer NEW
MGT 510 Midterm and Final Exam – Strayer NEW
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Chapters 1 Through 15
Chapter 1 Multinational Management in a Changing World
MULTIPLE CHOICE
1. Businesses of all sizes are increasingly looking for global opportunities because
a. Trade barriers are falling.
b. Money is flowing more freely across countries.
c. The world is becoming one interconnected economy.
d. All of the above.
AACSB Analytic, Strategy
PTS: 1
2. Globalization is
a. The trend of businesses expanding beyond their domestic boundaries.
b. Increasing average temperature over the globe.
c. The increased use of global satellite communication systems.
d. A strategy of developing unique products for each nation in the world.
AACSB Reflective thinking, Environmental influence
PTS: 1
3. Which of the following would not be considered a basic source of globalization?
a. Similar customer needs
b. Falling of trade barriers
c. Advances in communication technology
d. Differentiation among countries
AACSB Reflective Thinking, Environmental influence
PTS: 1
4. Multinational management is
a. A strategy of developing similar strategies for different countries.
b. The trend of business expanding beyond local boundaries.
c. The formulation and design of management systems to successfully take advantage of international opportunities and respond to international threats.
d. None of the above
AACSB Reflective thinking, Strategy
PTS: 1
5. According to the text, the multinational company
a. Is required to be a public corporation.
b. Is any company that engages in any business function across borders.
c. Must sell overseas to be a true multinational.
d. Must be large.
AACSB Reflective thinking, Strategy
PTS: 1
6. Which of the following is not a classification of economic systems noted in the text?
a. Domestic economies
b. Transition economies
c. LDCs
d. Emerging markets
AACSB Reflective thinking, Environmental influence
PTS: 1
7. Transition economies are
a. Mature economies with substantial per capita GDP and international trade.
b. Led by Hong Kong, Singapore, South Korea, and Taiwan.
c. Countries changing from government-controlled or communistic economies to a more free market capitalism.
d. None of the above
AACSB Reflective thinking, Environmental influence
PTS: 1
8. Emerging markets include
a. OECD countries.
b. Brazil, China, Russia, India.
c. Korea, Japan and USA.
d. Hungary, Poland, Slovakia.
AACSB Reflective thinking, Environmental influence
PTS: 1
9. Developing economies are
a. Mature economies with substantial per capita GDP and international trade.
b. Hong Kong, Singapore, and Taiwan.
c. Countries in the process of changing their economies from government-controlled to a more free market capitalism.
d. None of the above
AACSB Reflective thinking, Environmental influence
PTS: 1
10. Emerging markets are defined as those that are:
a. Growing rapidly.
b. Transitioning from a communist-controlled economy to capitalism.
c. Seen to have impact only sporadically.
d. Enjoying a mature economy.
AACSB Reflective thinking, Environmental influence
PTS: 1
11. Major regional trade agreements include all of the following EXCEPT
a. EU.
b. NAFTA.
c. APEC.
d. PROTEC.
AACSB Reflective thinking, Legal responsibilities
PTS: 1
12. The economic agreement that links the US, Canada, and Mexico in an economic bloc that allows freer exchange of goods and services is known as the
a. EU.
b. OPEC.
c. APEC.
d. None of the above
AACSB Reflective thinking, Legal responsibilities
PTS: 1
13. The World Trade Organization:
a. Is a major trading company.
b. Succeeded the GATT agreements.
c. Collects duties for member countries.
d. Is a consulting group for companies who wish to engage in international trade.
AACSB Reflective thinking, Legal responsibilities
PTS: 1
14. Examples of developed economies would include:
a. The U.S. and Japan.
b. Hungary and Poland.
c. Argentina and Brazil.
d. Hong Kong and Singapore.
AACSB Reflective thinking, Creation of value
PTS: 1
15. According to your text, FDI means
a. Foreign development initiatives.
b. Various investment policies of the U.S. government.
c. A foreign company has an ownership position in a company in another country.
d. A type of international negotiation strategy.
AACSB Reflective thinking, Legal responsibilities
PTS: 1
16. The two forms of risk discussed in the text include
a. Exchange rate risk and corruption risk.
b. Business risk and social risk.
c. Sales risk and employment risk.
d. Economic and political risk.
AACSB Reflective thinking, Environmental influence
PTS: 1
17. Economic risks discussed in the text include
a. Anything a government might do or not do that might adversely affect a company.
b. The likelihood of losing money if one invests in stocks.
c. Exchange and interest rates.
d. Expropriating of foreign firms by the local government without any compensation.
AACSB Reflective thinking, Environmental influence
PTS: 1
18. Anything that a government might do to affect a multinational adversely is known as
a. Exchange rate risk.
b. Business risk.
c. Sales risk.
d. Political risk.
AACSB Reflective thinking, Leadership
PTS: 1
19.. A global product or service is
a. Adapted for each country's unique needs.
b. A similar product or service for all customers throughout the world.
c. A product or service that requires bilingual customers.
d. Products developed for use outside the country.
AACSB Reflective thinking, Creation of value
PTS: 1
20. Which of the following statements about the Internet and Information Technology is true?
a. The Internet is benefiting companies worldwide.
b. Electronic communications does not allow companies to communicate with locations around the world.
c. Information technology is not encouraging a borderless financial market.
d. Information technology does not allow the sharing of information around the world.
AACSB Technology, Information technology
PTS: 1
21. The free market reforms in emerging countries are creating a potential group of
a. new competitors.
b. old competitors.
c. subsidized firms.
d. government companies.
AACSB Analytic, Environmental influence
PTS: 1
22. Which of the following statements is true about privatization?
a. Developing nations have the highest rate of privatization.
b. The leading privatizers in the world do not face competition.
c. Privatization is the sale of private business to government investors.
d. Privatization is absent in transition economies.
AACSB Analytic, Legal responsibilities
PTS: 1
23. Global customers:
a. Search for government-controlled enterprises.
b. Provide reduced government trade protection.
c. Search the world for their supplies without regard to national boundaries.
d. Encourage large firms to sell to them.
AACSB Reflective thinking, Strategy
PTS: 1
24. Global trade has this important effect on developing new competitors.
a. It facilitates the transfer of technology, allowing former assemblers to become creators.
b. It facilitates the transfer of knowledge, allowing former builders to become assemblers.
c. It reduces competition.
d. It reduces rivalry.
AACSB Reflective thinking, Creation of value
PTS: 1
25. Global standards for products
a. Are virtually impossible in technical industries.
b. Refer to having one product standard for all countries.
c. Puts companies at a strategic disadvantage.
d. All of the above
AACSB Reflective thinking, Creation of value
PTS: 1
26. According to the experts cited in your text, the next generation of global managers will need all of the following, EXCEPT:
a. Emotional intelligence
b. The ability to work with people from different cultural backgrounds
c. Poor negotiation skills
d. A local mindset
AACSB Reflective thinking, Leadership
PTS: 1
27. A global mindset requires managers to think globally but
a. act locally.
b. have emotional intelligence.
c. understand national cultures.
d. need accomplished negotiation skills.
AACSB Reflective thinking, Leadership
PTS: 1
28. The strategic approach to multinational management
a. Involves the development of one strategy for all countries.
b. Focuses on the skills and aptitudes that the next generation of global managers will need.
c. Is concerned with developing strategies that deal with operating in more than one country and culture.
d. None of the above
AACSB Reflective thinking, Strategy
PTS: 1
29. Which of the following statements about globalization is false?
a. Globalization is a simple evolutionary process.
b. Not all economies of the world are benefiting equally from globalization.
c. Terrorism, wars and SARS has limited and even reversed the effects of globalization.
d. All of the above statements are false.
AACSB Reflective thinking, Environmental influence
PTS: 1
30. Aggressive multinational companies from emerging markets are
a. expanding beyond their own borders.
b. staying within their own national borders.
c. help transition from a communist to a capitalist system.
d. unable to compete with western companies.
AACSB Reflective thinking, Strategy
PTS: 1
31. The set of technical standards developed by the International Organization for Standardization are known as
a. ISO 92.
b. ISO 14000.
c. ISO 9001: 2000.
d. None of the above
AACSB Reflective thinking, Legal responsibilities
PTS: 1
32. One of the major reasons why global companies seek to develop standard products is because
a. A standard product allows the company to save money because the same product can be sold anywhere.
b. A company can be more responsive to local cultural conditions.
c. It allows the company to invest more in research and development.
d. All of the above
AACSB Reflective thinking, Creation of value
PTS: 1
33. Emerging markets are
a. Located mostly
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Chapters 1 Through 15
Chapter 1 Multinational Management in a Changing World
MULTIPLE CHOICE
1. Businesses of all sizes are increasingly looking for global opportunities because
a. Trade barriers are falling.
b. Money is flowing more freely across countries.
c. The world is becoming one interconnected economy.
d. All of the above.
AACSB Analytic, Strategy
PTS: 1
2. Globalization is
a. The trend of businesses expanding beyond their domestic boundaries.
b. Increasing average temperature over the globe.
c. The increased use of global satellite communication systems.
d. A strategy of developing unique products for each nation in the world.
AACSB Reflective thinking, Environmental influence
PTS: 1
3. Which of the following would not be considered a basic source of globalization?
a. Similar customer needs
b. Falling of trade barriers
c. Advances in communication technology
d. Differentiation among countries
AACSB Reflective Thinking, Environmental influence
PTS: 1
4. Multinational management is
a. A strategy of developing similar strategies for different countries.
b. The trend of business expanding beyond local boundaries.
c. The formulation and design of management systems to successfully take advantage of international opportunities and respond to international threats.
d. None of the above
AACSB Reflective thinking, Strategy
PTS: 1
5. According to the text, the multinational company
a. Is required to be a public corporation.
b. Is any company that engages in any business function across borders.
c. Must sell overseas to be a true multinational.
d. Must be large.
AACSB Reflective thinking, Strategy
PTS: 1
6. Which of the following is not a classification of economic systems noted in the text?
a. Domestic economies
b. Transition economies
c. LDCs
d. Emerging markets
AACSB Reflective thinking, Environmental influence
PTS: 1
7. Transition economies are
a. Mature economies with substantial per capita GDP and international trade.
b. Led by Hong Kong, Singapore, South Korea, and Taiwan.
c. Countries changing from government-controlled or communistic economies to a more free market capitalism.
d. None of the above
AACSB Reflective thinking, Environmental influence
PTS: 1
8. Emerging markets include
a. OECD countries.
b. Brazil, China, Russia, India.
c. Korea, Japan and USA.
d. Hungary, Poland, Slovakia.
AACSB Reflective thinking, Environmental influence
PTS: 1
9. Developing economies are
a. Mature economies with substantial per capita GDP and international trade.
b. Hong Kong, Singapore, and Taiwan.
c. Countries in the process of changing their economies from government-controlled to a more free market capitalism.
d. None of the above
AACSB Reflective thinking, Environmental influence
PTS: 1
10. Emerging markets are defined as those that are:
a. Growing rapidly.
b. Transitioning from a communist-controlled economy to capitalism.
c. Seen to have impact only sporadically.
d. Enjoying a mature economy.
AACSB Reflective thinking, Environmental influence
PTS: 1
11. Major regional trade agreements include all of the following EXCEPT
a. EU.
b. NAFTA.
c. APEC.
d. PROTEC.
AACSB Reflective thinking, Legal responsibilities
PTS: 1
12. The economic agreement that links the US, Canada, and Mexico in an economic bloc that allows freer exchange of goods and services is known as the
a. EU.
b. OPEC.
c. APEC.
d. None of the above
AACSB Reflective thinking, Legal responsibilities
PTS: 1
13. The World Trade Organization:
a. Is a major trading company.
b. Succeeded the GATT agreements.
c. Collects duties for member countries.
d. Is a consulting group for companies who wish to engage in international trade.
AACSB Reflective thinking, Legal responsibilities
PTS: 1
14. Examples of developed economies would include:
a. The U.S. and Japan.
b. Hungary and Poland.
c. Argentina and Brazil.
d. Hong Kong and Singapore.
AACSB Reflective thinking, Creation of value
PTS: 1
15. According to your text, FDI means
a. Foreign development initiatives.
b. Various investment policies of the U.S. government.
c. A foreign company has an ownership position in a company in another country.
d. A type of international negotiation strategy.
AACSB Reflective thinking, Legal responsibilities
PTS: 1
16. The two forms of risk discussed in the text include
a. Exchange rate risk and corruption risk.
b. Business risk and social risk.
c. Sales risk and employment risk.
d. Economic and political risk.
AACSB Reflective thinking, Environmental influence
PTS: 1
17. Economic risks discussed in the text include
a. Anything a government might do or not do that might adversely affect a company.
b. The likelihood of losing money if one invests in stocks.
c. Exchange and interest rates.
d. Expropriating of foreign firms by the local government without any compensation.
AACSB Reflective thinking, Environmental influence
PTS: 1
18. Anything that a government might do to affect a multinational adversely is known as
a. Exchange rate risk.
b. Business risk.
c. Sales risk.
d. Political risk.
AACSB Reflective thinking, Leadership
PTS: 1
19.. A global product or service is
a. Adapted for each country's unique needs.
b. A similar product or service for all customers throughout the world.
c. A product or service that requires bilingual customers.
d. Products developed for use outside the country.
AACSB Reflective thinking, Creation of value
PTS: 1
20. Which of the following statements about the Internet and Information Technology is true?
a. The Internet is benefiting companies worldwide.
b. Electronic communications does not allow companies to communicate with locations around the world.
c. Information technology is not encouraging a borderless financial market.
d. Information technology does not allow the sharing of information around the world.
AACSB Technology, Information technology
PTS: 1
21. The free market reforms in emerging countries are creating a potential group of
a. new competitors.
b. old competitors.
c. subsidized firms.
d. government companies.
AACSB Analytic, Environmental influence
PTS: 1
22. Which of the following statements is true about privatization?
a. Developing nations have the highest rate of privatization.
b. The leading privatizers in the world do not face competition.
c. Privatization is the sale of private business to government investors.
d. Privatization is absent in transition economies.
AACSB Analytic, Legal responsibilities
PTS: 1
23. Global customers:
a. Search for government-controlled enterprises.
b. Provide reduced government trade protection.
c. Search the world for their supplies without regard to national boundaries.
d. Encourage large firms to sell to them.
AACSB Reflective thinking, Strategy
PTS: 1
24. Global trade has this important effect on developing new competitors.
a. It facilitates the transfer of technology, allowing former assemblers to become creators.
b. It facilitates the transfer of knowledge, allowing former builders to become assemblers.
c. It reduces competition.
d. It reduces rivalry.
AACSB Reflective thinking, Creation of value
PTS: 1
25. Global standards for products
a. Are virtually impossible in technical industries.
b. Refer to having one product standard for all countries.
c. Puts companies at a strategic disadvantage.
d. All of the above
AACSB Reflective thinking, Creation of value
PTS: 1
26. According to the experts cited in your text, the next generation of global managers will need all of the following, EXCEPT:
a. Emotional intelligence
b. The ability to work with people from different cultural backgrounds
c. Poor negotiation skills
d. A local mindset
AACSB Reflective thinking, Leadership
PTS: 1
27. A global mindset requires managers to think globally but
a. act locally.
b. have emotional intelligence.
c. understand national cultures.
d. need accomplished negotiation skills.
AACSB Reflective thinking, Leadership
PTS: 1
28. The strategic approach to multinational management
a. Involves the development of one strategy for all countries.
b. Focuses on the skills and aptitudes that the next generation of global managers will need.
c. Is concerned with developing strategies that deal with operating in more than one country and culture.
d. None of the above
AACSB Reflective thinking, Strategy
PTS: 1
29. Which of the following statements about globalization is false?
a. Globalization is a simple evolutionary process.
b. Not all economies of the world are benefiting equally from globalization.
c. Terrorism, wars and SARS has limited and even reversed the effects of globalization.
d. All of the above statements are false.
AACSB Reflective thinking, Environmental influence
PTS: 1
30. Aggressive multinational companies from emerging markets are
a. expanding beyond their own borders.
b. staying within their own national borders.
c. help transition from a communist to a capitalist system.
d. unable to compete with western companies.
AACSB Reflective thinking, Strategy
PTS: 1
31. The set of technical standards developed by the International Organization for Standardization are known as
a. ISO 92.
b. ISO 14000.
c. ISO 9001: 2000.
d. None of the above
AACSB Reflective thinking, Legal responsibilities
PTS: 1
32. One of the major reasons why global companies seek to develop standard products is because
a. A standard product allows the company to save money because the same product can be sold anywhere.
b. A company can be more responsive to local cultural conditions.
c. It allows the company to invest more in research and development.
d. All of the above
AACSB Reflective thinking, Creation of value
PTS: 1
33. Emerging markets are
a. Located mostly
HRM 522 Week 5 Midterm Exam – Strayer NEW
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Chapters 1 Through 6
Chapter 1
1.Principlesare
a.lawsandregulationsthatguidebehaviorinthe worldofbusiness. b.mores,values,andcustomsthatguidebehavioringeneral.
c.specificandpervasiveboundariesforbehaviorthatareuniversalandabsolute.
d.theobligationsbusinessesassumeto maximizetheirpositiveimpactandminimizetheirnegativeimpacton stakeholders.
e.themores,values,andcustomsthatparentsteachtheirchildren.
2.Social responsibilityis
a.anorganization'sobligationtomaximizeitspositiveeffectsand minimizeitsnegativeeffectsonstakeholders. b.principlesandstandardsthatguidebehaviorinthe worldofbusiness.
c.abusiness'sresponsibilitynotto pollutetheenvironment.
d.a business'sresponsibilitytomanufactureproductsthatfunctionproperly. e.charitablecontributionsmadeby abusinesstoenhanceits image.
3.The
was/wereenactedtorestoreconfidenceinfinancialreportingandbusinessethicsaftertheaccounting
scandalsoftheearly2000s.
a.DefenseIndustryInitiativeon BusinessEthicsandConduct b.Sarbanes-OxleyAct
c.FederalSentencingGuidelinesforOrganizations d.ForeignCorruptPracticesAct
e.Dodd-FrankWallStreetReformandConsumerProtectionAct
4.Thetermbusinessethicsisbestdescribedbythe followingstatement:
a.Itisthestudyand philosophyofhumanconduct,withanemphasisondeterminingrightand wrong.
b.Itisan"inquiryintothe natureandgroundsofmoralitywherethe termmoralityistakentomeanmoral judgments,standardsandrulesofconduct."
c.Itisthe"studyof thegeneralnatureof moralsandof specificmoralchoices;moralphilosophy;andtherules orstandardsgoverningtheconductofthemembersofaprofession."
d.Itisanorganization'sobligationtomaximizeitspositiveeffectsand minimizeitsnegativeeffectson stakeholders.
e.Itcomprisesthe principles,values,andstandardsthatguidebehaviorinthe worldofbusiness.
5.Whichofthefollowingis notone oftherightsspelledout byJohnF.Kennedyinhis"Consumers'BillofRights"?
a.Therighttochoose b.Therightto safety
c.Therighttobeinformed d.Therighttobeethical
e.Therightto beheard
6.Duringthe1990stheinstitutionalizationofbusinessethicswas largelydrivenbywhichpieceoflegislation?
a.Sarbanes-OxleyAct
b.FederalSentencingGuidelinesforOrganizations
c.Dodd-FrankWallStreetReformandConsumerProtectionAct d.ForeignCorruptPracticesAct
e.Global SullivanPrinciples
7.Businessethics,asafield,haspassedthroughwhichofthefollowingstates?
a.Afieldofstudytotheologicaldiscussiontorecognitionofsocialissues b.Recognitionofsocialissuestoa fieldofstudytotheologicaldiscussion c.Afieldofstudytorecognitionofsocialissuestotheologicaldiscussion d.Recognitionofsocialissuestotheologicaldiscussiontoa fieldofstudy e.Theologicaldiscussiontorecognitionofsocialissuestoa fieldofstudy
8.The1960ssawariseofconsumerism.Whatis consumerism?
a.An increaseinconsumerrightsbyorganizationsandgovernments b.Thegrowthofinternationalretailchainstores
c.Activitiesundertakenbyindependentindividuals,and groupsto protecttheirrightsasconsumers d.Thewidespreadadoptionof consumerorientedmarketingstrategiesamongbusinesses
e.Organizations’tendencytoseekwaystotakeadvantageofconsumers
9.Ethicsisa partofdecisionmaking
a.atall levelsof workandmanagement.
b.primarilyatthe uppermanagementlevelsofanorganization. c.mostlyforpolicymakers.
d.thatislessimportantthanotherdecisionmakingprocesses. e.onlyatthatlowerlevelsoforganizationalmanagement.
10.Whichofthe followingwasdevelopedinthe 1980stoguidecorporatesupportfor ethicalconductbyestablishinga methodfordiscussingbestpractices?
a.FederalSentencingGuidelinesforOrganizations
b.DefenseIndustryInitiativeon BusinessEthicsandConduct c.Corporatecodesofconduct
d.UnitedStatesSentencingCommission e.MERCOSUR
11.The
focus(es)onfirmstakingactionto preventanddetectbusinessmisconductin cooperationwith
governmentregulation.
a.UnitedStatesSentencingCommission
b.DefenseIndustryInitiativeon BusinessEthicsandConduct c.WorldTradeOrganization
d.UnitedNationsGlobalCompact
e.FederalSentencingGuidelinesforOrganizations
12.Thestudyofbusinessethicsisimportanttobetterunderstandallofthe followingexcept
a.thata person'sownmoralphilosophiesanddecision-makingexperiencemaynotbesufficienttoguidehimor herinthebusinessworld.
b.howandwhypeoplemakeethicalorunethicaldecisions.
c.howto copewithconflictsbetweenaperson'sownvaluesandthoseoftheorganizationin whichheorshe works.
d.thatbusinessethicsisentirelyanextensionofanindividual'sownpersonalethics. e.howtoidentifyethicalissuesarisinginthebusinessworld.
13.Accordingto theroleofethicalculturein performance,allofthesearedriversofprofitexcept
a.trust.
b.investorloyalty.
c.employeecommitment. d.customersatisfaction.
e.opportunityformisconduct.
14.Morethana complianceprogram,businessethicsisbecoming a.amanagementissueto achievecompetitiveadvantage.
b.lessacceptedbysociety.
c.mainlyagovernmentregulatoryissue.
d.an initiativeledby nonprofitorganizations.
e.aprogramthatdecreasesprofitsbutincreasessocietalbenefits.
15.Havingacceptablepersonalethicsisprobablynotgoingto besufficientto handlecomplexbusinessethicalissues whenanindividualhas
a.familyconcerns. b.an unethicalboss.
c.limitedbusinessexperience. d.financialtraining.
e.a marketingbackground.
16.OneofthemajorethicalissuesPresidentObama’sadministrationfocusedonwas
a.decreasingenvironmentallegislation. b.deregulation.
c.taxdecreases.
d.incentivesto oilcompanies.
e.healthcareandconsumerprotection.
17.Whichof thefollowingisgenerallynotconsidereda businessethicsissue?
a.Harassment
b.Accountingfraud c.Employeetheft
d.Misuseoforganizationalresources e.Corporatehierarchy
18.Whichrepresenteda far-reachingchangetoorganizationalcontrolandaccountingsystems,makingsecuritiesfrauda criminaloffense?
a.CouncilonEconomicPrioritiesandSocialAccountability8000. b.Sarbanes-OxleyAct.
c.ConsumerProtectionAct.
d.DefenseIndustryInitiativeon BusinessEthicsandConduct.
e.Dodd-FrankWallStreetReformandConsumerProtectionAct.
19.TheForeignCorruptPracticesActoutlawed a.accountingfraud.
b.pricecollusion.
c.corruptioningovernment.
d.briberyofofficialsin othercountries. e.executivemisconduct.
20.WhichofthefollowingwasnotaprovisionoftheSarbanes-OxleyAct?
a.Itstiffenedpenaltiesforcorporatefraud.
b.It createdanaccountingoversightboardthatrequirescorporationsto establishcodesofethicsforfinancial reporting.
c.Itrequiredtopexecutivestosignoffon theirfirms'financialstatements. d.Itoutlawedbriberyofofficialsinothercountries.
e.Itmadesecuritiesfrauda criminaloffense.
21.Whichofthefollowingis notcitedas an exampleof a globalcollaborativeefforttoestablishstandardsof business conduct?
a.CouncilonEconomicPriorities'SocialAccountability8000 b.EthicalTradingInitiative
c.U.S.ApparelIndustryPartnership
d.UnitedStatesSentencingCommission e.WorldTradeOrganization
22.Becauseof Sarbanes-Oxley,publiclytradedcompaniesmustdevelop financialreporting.
a.ethicsofficers
b.ethicsprograms c.codesofethics d.legalcounsel
e.accountants
toassistinmaintainingtransparencyin
23. isessentialinbuildinglong-termrelationshipsbetweenbusinessesandconsumers. a.Profits
b.Dividends c.Trust
d.Hubris
e.Codesofethics
24.TheDodd-FrankWallStreetReformandConsumerProtectionAct a.wasverypopularamongWallStreetbankers.
b.representedonlymodestreform.
c.cameout oftheologicaldiscussionsin the1920s.
d.wasdesignedtomakethefinancialservicesindustrymoreresponsible. e.madeitmandatoryforpubliccorporationstohireethicsofficers.
25.IntheReagan/Busheras,themajorfocusofthebusinessworldwason a.self-regulationratherthanregulationbygovernment.
b.decreasingthenumberofmergers.
c.decreasingthemultinationalpresencein theU.S.marketplace. d.increasinggovernmentinfluenceon theeconomicarena.
e.improvingbusinessethics.
26.Thesixprinciplesof theDefenseIndustryInitiativeon BusinessEthicsandConductbecamethefoundationfor a.BetterBusinessBureauethicalguidelines.
b.theFederalSentencingGuidelinesforOrganizations. c.theEthicalTradingInitiative.
d.the FederalTradeCommissioncompliancerequirements. e.theSarbanes-OxleyAct.
27.Ethicalcultureisdefinedas
a.rules,standards,and moralprinciplesregardingwhatis rightorwrongin specificsituations. b.theestablishmentandenforcementof ethicalcodesthroughouttheorganization.
c.thedevelopmentofrulesandnormsthataresociallyenforced.
d.the codificationoflawstorewardorganizationsfor takingactiontopreventmisconduct. e.acceptablebehaviorasdefinedbythecompanyandindustry.
28.TheFederalSentencingGuidelinesfor Organizationsset the tonefor organizationalethicscomplianceprogramsby a.codifyingintolaw incentivesfororganizationstotakeactionsuchasdevelopingethicalcomplianceprograms
topreventmisconduct.
b.forcingallorganizationstodevelopmandatoryreportingsystems.
c.eliminatingmostofthefederallegislationthatcreatedinefficientand time-consumingactivitiesforbusinesses. d.providingastudyof moralphilosophies.
e.providinganexaminationofcompanycodesofethics.
29.WhichofthefollowingstatementsabouttheFederalSentencingGuidelinesforOrganizationsisfalse?
a.Theyusearoutinemechanicalapproachthatforcesallfirmstousethesamemeanstoavertserious penalties.
b.Theystrivetopreventmisconduct.
c.Theyencouragecompaniesto developstandardsandprocedurescapableofdetectingandpreventing misconduct.
d.Theyutilizea carrotandstickapproachbytakingpreventiveactionagainstmisconduct.
e.Theyencouragethe appointmentofhigh-levelpersonnelresponsiblefor oversightofthe complianceprogram.
30.Whichofthefollowingis notoneofthe benefitsofbeingethicalandsociallyresponsibleinbusiness?
a.Greateremployeecommitment
b.Ahighdegreeof employeedissent
c.Improvedcustomertrustandsatisfaction d.Increasedinvestorloyalty
e.Betterfinancialperformance
31.Employees'perceptionsof theirfirmas havingan ethicalclimateleadsto a.lackoffocusongoals.
b.greaterfocusoneducation.
c.increasedcommunityinvolvement.
d.improvedrelationshipswith competitors. e.enhancedperformance.
32.Employeesfeellesspressuretocompromiseethically,observelessmisconduct,aremoresatisfiedwith
FIN 535 Week 5 Midterm Exam – Strayer New
FIN 535 Week 5 Midterm Exam – Strayer New
Click On The Link Below To Purchase A+ Graded Material
Instant Download
http://budapp.net/FIN-535-Midterm-Exam-Week-5-Strayer-NEW-FIN535W5E.htm
Chapter 1 Through 7
Chapter 1—Multinational Financial Management: An Overview
1. The commonly accepted goal of the MNC is to:
a. maximize short-term earnings.
b. maximize shareholder wealth.
c. minimize risk.
d. A and C.
e. maximize international sales.
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
2. With regard to corporate goals, an MNC is mostly concerned with maximizing ____, and a purely domestic firm is mostly concerned with maximizing ____.
a. shareholder wealth; short-term earnings
b. shareholder wealth; shareholder wealth
c. short-term earnings; sales volume
d. short-term earnings; shareholder wealth
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
3. For the MNC, agency costs are typically:
a. non-existent.
b. larger than agency costs of a small purely domestic firm.
c. smaller than agency costs of a small purely domestic firm.
d. the same as agency costs of a small purely domestic firm.
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
4. Which of the following could reduce agency problems for an MNC?
a. stock options as managerial compensation.
b. hostile takeover threat.
c. investor monitoring.
d. all of the above are forms of corporate control that could reduce agency problems for an MNC.
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
5. The valuation of an MNC should rise when an event causes the expected cash flows from foreign to ____ and when foreign currencies denominating these cash flows are expected to ____.
a. decrease; appreciate
b. increase; appreciate
c. decrease; depreciate
d. increase; depreciate
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.04
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
6. Which of the following theories identifies specialization as a reason for international business?
a. theory of comparative advantage.
b. imperfect markets theory.
c. product cycle theory.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
7. Which of the following theories identifies the non-transferability of resources as a reason for international business?
a. theory of comparative advantage.
b. imperfect markets theory.
c. product cycle theory.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
8. Which of the following theories suggests that firms seek to penetrate new markets over time?
a. theory of comparative advantage.
b. imperfect markets theory.
c. product cycle theory.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
9. Which of the following industries would most likely take advantage of lower costs in some less developed foreign countries?
a. assembly line production.
b. specialized professional services.
c. nuclear missile planning.
d. planning for more sophisticated computer technology.
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Application
10. Due to the risks involved in international business, firms should:
a. only consider international business in major countries.
b. maintain international business to no more than 20% of total business.
c. maintain international business to no more than 35% of total business.
d. none of the above
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
11. A product cycle is the process by which a firm provides a specialized sales or service strategy, support assistance, and possibly an initial investment in the franchise in exchange for periodic fees.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
12. Licensing is the process by which a firm provides its technology (copyrights, patents, trademarks, or trade names) in exchange for fees or some other specified benefits.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
13. The agency costs of an MNC are likely to be lower if it:
a. scatters its subsidiaries across many foreign countries.
b. increases its volume of international business.
c. uses a centralized management style.
d. A and B.
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
14. An MNC may be more exposed to agency problems if most of its shares are held by:
a. a few mutual funds
b. a widely dispersed set of individual investors
c. a few pension funds
d. all of the above would prevent agency problems
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
15. The Sarbanes-Oxley Act improves corporate governance of MNCs because it:
a. makes executives more accountable for verifying financial statements
b. eliminates stock options as a form of compensation
c. ties executive compensation to firm performance
d. places a limit on the amount of funds that managers can spend
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
16. MNCs can improve their internal control process by all of the following, except:
a. establishing a centralized data base of information
b. ensuring that all data are reported consistently among subsidiaries
c. ensuring that the MNC always borrows from countries where interest rates are lowest
d. using a system that checks internal data for unusual discrepancies
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
17. Franchising is the process by which national governments sell state owned operations to corporations and other investors.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
18. The parent of MNC can implement compensation plans that directly reward the subsidiary managers for enhancing the value of the MNC.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
19. If a publicly-traded MNC's managers make poor decisions that reduce its value, it may encourage other firms to acquire it.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
20. Institutional investors such as mutual funds or pension funds which have large holdings of an MNC's stock do not normally want to take control of it and therefore have no influence over management of the MNC.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
21. In comparing exporting to direct foreign investment (DFI), an exporting operation will likely incur ____ fixed production costs and ____ transportation costs than DFI.
a. higher; higher
b. higher; lower
c. lower; lower
d. lower; higher
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
22. Which of the following is an example of direct foreign investment?
a. exporting to a country.
b. establishing licensing arrangements in a country.
c. purchasing existing companies in a country.
d. investing directly (without brokers) in foreign stocks.
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Application
23. According to the text, a disadvantage of licensing is that:
a. it prevents a firm from importing.
b. it is difficult to ensure quality control of the production process.
c. it prevents a firm from exporting.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
24. ____ are most commonly classified as a direct foreign investment.
a. Foreign acquisitions
b. Purchases of international stocks
c. Licensing agreements
d. Exporting transactions
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
25. Imperfect markets represent conditions under which factors of production are immobile.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
26. The Sarbanes-Oxley Act (SOX) was enacted in 2002 required MNCs and other firms to implement an internal reporting process that could be easily monitored by executives and the board of directors.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
27. If markets were perfect, then labor and other costs of production would be perfectly stable (no movement across borders).
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
28. The valuation of an MNC is reduced if the required return on its investments in foreign countries is reduced.
a. True
b. False
PTS: 1 DI
Click On The Link Below To Purchase A+ Graded Material
Instant Download
http://budapp.net/FIN-535-Midterm-Exam-Week-5-Strayer-NEW-FIN535W5E.htm
Chapter 1 Through 7
Chapter 1—Multinational Financial Management: An Overview
1. The commonly accepted goal of the MNC is to:
a. maximize short-term earnings.
b. maximize shareholder wealth.
c. minimize risk.
d. A and C.
e. maximize international sales.
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
2. With regard to corporate goals, an MNC is mostly concerned with maximizing ____, and a purely domestic firm is mostly concerned with maximizing ____.
a. shareholder wealth; short-term earnings
b. shareholder wealth; shareholder wealth
c. short-term earnings; sales volume
d. short-term earnings; shareholder wealth
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
3. For the MNC, agency costs are typically:
a. non-existent.
b. larger than agency costs of a small purely domestic firm.
c. smaller than agency costs of a small purely domestic firm.
d. the same as agency costs of a small purely domestic firm.
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
4. Which of the following could reduce agency problems for an MNC?
a. stock options as managerial compensation.
b. hostile takeover threat.
c. investor monitoring.
d. all of the above are forms of corporate control that could reduce agency problems for an MNC.
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
5. The valuation of an MNC should rise when an event causes the expected cash flows from foreign to ____ and when foreign currencies denominating these cash flows are expected to ____.
a. decrease; appreciate
b. increase; appreciate
c. decrease; depreciate
d. increase; depreciate
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.04
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
6. Which of the following theories identifies specialization as a reason for international business?
a. theory of comparative advantage.
b. imperfect markets theory.
c. product cycle theory.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
7. Which of the following theories identifies the non-transferability of resources as a reason for international business?
a. theory of comparative advantage.
b. imperfect markets theory.
c. product cycle theory.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
8. Which of the following theories suggests that firms seek to penetrate new markets over time?
a. theory of comparative advantage.
b. imperfect markets theory.
c. product cycle theory.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
9. Which of the following industries would most likely take advantage of lower costs in some less developed foreign countries?
a. assembly line production.
b. specialized professional services.
c. nuclear missile planning.
d. planning for more sophisticated computer technology.
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Application
10. Due to the risks involved in international business, firms should:
a. only consider international business in major countries.
b. maintain international business to no more than 20% of total business.
c. maintain international business to no more than 35% of total business.
d. none of the above
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
11. A product cycle is the process by which a firm provides a specialized sales or service strategy, support assistance, and possibly an initial investment in the franchise in exchange for periodic fees.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
12. Licensing is the process by which a firm provides its technology (copyrights, patents, trademarks, or trade names) in exchange for fees or some other specified benefits.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
13. The agency costs of an MNC are likely to be lower if it:
a. scatters its subsidiaries across many foreign countries.
b. increases its volume of international business.
c. uses a centralized management style.
d. A and B.
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
14. An MNC may be more exposed to agency problems if most of its shares are held by:
a. a few mutual funds
b. a widely dispersed set of individual investors
c. a few pension funds
d. all of the above would prevent agency problems
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
15. The Sarbanes-Oxley Act improves corporate governance of MNCs because it:
a. makes executives more accountable for verifying financial statements
b. eliminates stock options as a form of compensation
c. ties executive compensation to firm performance
d. places a limit on the amount of funds that managers can spend
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
16. MNCs can improve their internal control process by all of the following, except:
a. establishing a centralized data base of information
b. ensuring that all data are reported consistently among subsidiaries
c. ensuring that the MNC always borrows from countries where interest rates are lowest
d. using a system that checks internal data for unusual discrepancies
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
17. Franchising is the process by which national governments sell state owned operations to corporations and other investors.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
18. The parent of MNC can implement compensation plans that directly reward the subsidiary managers for enhancing the value of the MNC.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
19. If a publicly-traded MNC's managers make poor decisions that reduce its value, it may encourage other firms to acquire it.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
20. Institutional investors such as mutual funds or pension funds which have large holdings of an MNC's stock do not normally want to take control of it and therefore have no influence over management of the MNC.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
21. In comparing exporting to direct foreign investment (DFI), an exporting operation will likely incur ____ fixed production costs and ____ transportation costs than DFI.
a. higher; higher
b. higher; lower
c. lower; lower
d. lower; higher
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
22. Which of the following is an example of direct foreign investment?
a. exporting to a country.
b. establishing licensing arrangements in a country.
c. purchasing existing companies in a country.
d. investing directly (without brokers) in foreign stocks.
PTS: 1 DIF: Moderate OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Application
23. According to the text, a disadvantage of licensing is that:
a. it prevents a firm from importing.
b. it is difficult to ensure quality control of the production process.
c. it prevents a firm from exporting.
d. none of the above
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
24. ____ are most commonly classified as a direct foreign investment.
a. Foreign acquisitions
b. Purchases of international stocks
c. Licensing agreements
d. Exporting transactions
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.03
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
25. Imperfect markets represent conditions under which factors of production are immobile.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
26. The Sarbanes-Oxley Act (SOX) was enacted in 2002 required MNCs and other firms to implement an internal reporting process that could be easily monitored by executives and the board of directors.
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.01
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Knowledge
27. If markets were perfect, then labor and other costs of production would be perfectly stable (no movement across borders).
a. True
b. False
PTS: 1 DIF: Easy OBJ: INFM.MADU.15.01.02
NAT: BUSPROG.INFM .MADU.15.03 STA: DISC.INFM.MADU.15.02
KEY: Bloom's: Comprehension
28. The valuation of an MNC is reduced if the required return on its investments in foreign countries is reduced.
a. True
b. False
PTS: 1 DI
MKT 505 Exam Midterm and Final Exam – Strayer New
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Chapter 1-17
Global Marketing, 7e (Keegan/Green)
Chapter 1 Introduction to Global Marketing
1) With rapid global market expansion, McDonald's identity as the quintessential American fast-food restaurant is becoming blurred.
Answer:
Diff: 1 Page Ref: 3
AACSB: Reflective Thinking
Objective: 1
Question Type: Application
2) An organization that engages in global marketing focuses its resources and competencies on global market opportunities and threats.
Answer:
Diff: 1 Page Ref: 4
AACSB: Reflective Thinking
Objective: 2
Question Type: Application
3) Starbucks is building on its loyalty card and rewards program in the United States with a smartphone app that enables customers to pay for purchases electronically. This is an example of Market Penetration.
Answer:
Diff: 2 Page Ref: 4
AACSB: Reflective Thinking
Objective: 2
Question Type: Application
4) Starbucks is entering India via an alliance with the Tata Group. The next phase will likely involve opening Starbucks outlets in Tata's upscale Taj Hotels in India. These are examples of Market Penetration.
Answer:
Diff: 2 Page Ref: 4
AACSB: Analytic Skills
Objective: 2
Question Type: Critical thinking
5) The perceived value equation can be represented as Value = Price/Benefits.
Answer:
Diff: 1 Page Ref: 5
AACSB: Reflective Thinking
Objective: 2
Question Type: Definitional
6) The transformation of formerly local or national industries into global ones is a part of a broader economic process of globalization.
Answer:
Diff: 1 Page Ref: 6
AACSB: Reflective Thinking
Objective: 8
Question Type: Application
7) If Nestlé decides not to market biscuits (cookies) in the United States due to competitive reasons, it is considered as a lack of strategic focus and missed opportunity.
Answer:
Diff: 2 Page Ref: 7
AACSB: Reflective Thinking
Objective: 2
Question Type: Definitional
8) Value, competitive advantage, and the focus required to achieve them are universal in their relevance and should guide global marketing efforts in any part of the world.
Answer:
Diff: 2 Page Ref: 8
AACSB: Reflective Thinking
Objective: 2
Question Type: Definitional
9) The discipline of marketing is universal, and such marketing practices do not vary from country to country.
Answer:
Diff: 1 Page Ref: 8
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
10) The way a company addresses recognition of the extent to which programs can be expanded worldwide and adaptations required to do so is a reflection of its global marketing strategy.
Answer:
Diff: 2 Page Ref: 8
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
11) Nike dropped their well known tag line "Just do it" in advertising women's clothing in Europe and replaced it by the slogan "Here I am" since college-age women in Europe are not as competitive about sports as men are.
Answer:
Diff: 2 Page Ref: 10
AACSB: Analytic Skills
Objective: 3
Question Type: Critical thinking
12) Nations referred to as MINTs, which hold great potential marketing opportunities, are Mexico, India, Nigeria, and Turkey.
Answer:
Diff: 2 Page Ref: 12
AACSB: Reflective Thinking
Objective: 3
Question Type: Application
13) Global localization means that a successful global marketer must have the ability to think locally and act globally.
Answer:
Diff: 2 Page Ref: 12
AACSB: Reflective Thinking
Objective: 3
Question Type: Application
14) The Coca-Cola Company supports its Coke, Fanta, and PowerAde brands with marketing mix elements that are both global and local.
Answer:
Diff: 2 Page Ref: 12
AACSB: Analytic Skills
Objective: 3
Question Type: Application
15) McDonald's global marketing strategy is based primarily on local marketing mix elements.
Answer:
Diff: 2 Page Ref: 13
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
16) McDonald's home delivery of burgers in India is an example of unusual standardized global marketing practice.
Answer:
Diff: 2 Page Ref: 14
AACSB: Reflective Thinking
Objective: 3
Question Type: Application
17) Harley-Davidson's motorcycles competitive advantage is based in part on its "Made in the USA" positioning.
Answer:
Diff: 2 Page Ref: 14
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
18) Gap is a global brand, but recently the company has struggled to connect with customers in the United States.
Answer:
Diff: 2 Page Ref: 15
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
19) Wal-Mart is the largest corporation, based on revenues, according to the Fortune 500 Global ranking for 2011.
Answer:
Diff: 1 Page Ref: 16
AACSB: Reflective Thinking
Objective: 4
Question Type: Definitional
20) Examining the size of individual product markets, measured in terms of annual sales, provides another perspective on global marketing's importance.
Answer:
Diff: 2 Page Ref: 16
AACSB: Reflective Thinking
Objective: 4
Question Type: Application
21) The form and substance of a company's response to global market opportunities depend greatly on management's assumptions or beliefs about the nature of the world.
Answer:
Diff: 3 Page Ref: 16
AACSB: Reflective Thinking
Objective: 3
Question Type: Critical thinking
22) Ethnocentric companies that conduct business outside the home country adhere to the notion that the products that succeed in the home country are superior.
Answer:
Diff: 3 Page Ref: 17
AACSB: Analytic Skills
Objective: 3
Question Type: Definitional
23) Today, ethnocentrism is one of the major internal weaknesses that must be overcome if a company is to transform itself into an effective global competitor.
Answer:
Diff: 2 Page Ref: 17
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
24) The term "polycentric" describes management's belief or assumption that each country in which a company does business is unique.
Answer:
Diff: 2 Page Ref: 18
AACSB: Analytic Skills
Objective: 3
Question Type: Definitional
25) Unilever's Rexona deodorant brand had 30 different package designs and 48 different formulations. This is an example of ethnocentrism.
Answer:
Diff: 1 Page Ref: 18
AACSB: Reflective Thinking
Objective: 3
Question Type: Application
26) A U.S. company that focuses on the countries included in the North American Free Trade Agreement (NAFTA) has a regiocentric orientation.
Answer:
Diff: 3 Page Ref: 18
AACSB: Analytic Skills
Objective: 3
Question Type: Application
27) A European company that focuses its attention on Europe can be considered to have regiocentric orientation.
Answer:
Diff: 2 Page Ref: 18
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
28) A company with a geocentric orientation views the world as a potential market and strives to develop integrated global strategies.
Answer:
Diff: 1 Page Ref: 18
AACSB: Dynamics of Global Economy
Objective: 3
Question Type: Synthesis
29) Geocentric orientation represents true global marketing since it views the entire world as a potential market and develops global strategy.
Answer:
Diff: 3 Page Ref: 18
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
30) An ethnocentric management orientation is preferable to a geocentric orientation.
Answer:
Diff: 2 Page Ref: 20
AACSB: Reflective Thinking
Objective: 3
Question Type: Definitional
31) When a company establishes a site on the Internet, it automatically becomes global.
Answer:
Diff: 2 Page Ref: 19
AACSB: Use of IT
Objective: 3
Question Type: Definitional
32) The pressure for globalization is intense when new products require major investments and long periods of development time.
Answer:
Diff: 2 Page Ref: 21
AACSB: Reflective Thinking
Objective: 5
Question Type: Definitional
33) The economic growth has reduced resistance that might otherwise have developed in response to the entry of foreign firms into domestic economies.
Answer:
Diff: 3 Page Ref: 23
AACSB: Dynamics of Global Economy
Objective: 5
Question Type: Definitional
34) In the context of global marketing, leverage means some type of advantage that a company enjoys by virtue of the fact that it has experience in its home country.
Answer:
Diff: 3 Page Ref: 24
AACSB: Analytic Skills
Objective: 5
Question Type: Definitional
35) Companies that cannot formulate or successfully implement a coherent global strategy may lose their independence.
Answer:
Diff: 3 Page Ref: 25
AACSB: Analytic Skills
Objective: 6
Question Type: Definitional
36) A company that is nearsighted and ethnocentric will not expand geographically.
Answer:
Diff: 2 Page Ref: 25
AACSB: Reflective Thinking
Objective: 6
Question Type: Definitional
37) The term globaphobia is sometimes used to describe an attitude of hostility toward trade agreements, global brands or company policies that appear to result in hardship for some individuals or countries while benefiting others.
Answer:
Diff: 3 Page Ref: 26
AACSB: Reflective Thinking
Objective: 5
Question Type: Definitional
38) Nontariff barriers (NTBs) are monetary restrictions on cross-border trade.
Answer:
Diff: 2 Page Ref: 26
AACSB: Reflective Thinking
Objective: 4
Question Type: Definitional
39) When management moves to integrate and coordinate activities on a regional basis, the decision reflects an ethnocentric orientation.
Answer:
Diff: 2 Page Ref: 28
AACSB: Analytic Skills
Objective: 5
Question Type: Definitional
40) The dynamic interplay of several driving and restraining forces shapes the importance of gl
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