Globalization Chapter 1 Quiz
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Questions and Answers

Which type of totalitarianism is characterized by a large family controlling the government, often seen in countries like Dubai and some African nations?

  • Communist totalitarianism
  • Theocratic totalitarianism
  • Right-wing totalitarianism
  • Tribal totalitarianism (correct)

In a command economy, who primarily controls the allocation of resources, production, and prices?

  • The government (correct)
  • Market forces
  • Private individuals
  • International organizations

What is a defining characteristic of a market economy?

  • Centralized planning of resource allocation
  • Prices determined by supply and demand (correct)
  • Strict price controls set by the government
  • Government ownership of all industries

Which type of legal system is based on a comprehensive set of written laws and codes?

<p>Civil law (C)</p> Signup and view all the answers

In a totalitarian regime, which of the following freedoms are typically denied to citizens?

<p>All of the above (D)</p> Signup and view all the answers

Which of the following is NOT a characteristic of a totalitarian state?

<p>Regular, fair elections (B)</p> Signup and view all the answers

What is the primary purpose of a contract?

<p>To create a legally binding agreement between parties (D)</p> Signup and view all the answers

In a mixed economy, which of the following is true?

<p>Some sectors are privately owned while others are government controlled. (C)</p> Signup and view all the answers

Which of the following factors is NOT directly tied to fostering innovation and entrepreneurship according to the text?

<p>A strong military (D)</p> Signup and view all the answers

What type of economic system does the text suggest is the MOST conducive to innovation and entrepreneurship?

<p>Market Economy (A)</p> Signup and view all the answers

How does the text explain the relationship between economic growth and democracy?

<p>Economic growth is often followed by the establishment of a democratic regime. (B)</p> Signup and view all the answers

Why is it crucial to have strong property rights for innovation and entrepreneurship?

<p>They prevent the state from expropriating the profits from innovative efforts. (B)</p> Signup and view all the answers

What does the text suggest about the economic performance of countries like South Korea, Taiwan, Singapore, and Hong Kong?

<p>They initially had undemocratic governments but later became more democratic. (A)</p> Signup and view all the answers

How is education attainment measured?

<p>A combination of adult literacy rate and enrollment in primary, secondary, and tertiary education. (C)</p> Signup and view all the answers

What is considered sufficient in terms of average incomes for basic needs in a country?

<p>An average income that allows citizens to meet basic needs like food, shelter, and healthcare. (C)</p> Signup and view all the answers

What does the text suggest about the importance of innovation in the long run?

<p>Innovation is necessary for long-term economic growth. (D)</p> Signup and view all the answers

What does political risk primarily concern in a country's business environment?

<p>The likelihood of political changes affecting business profitability (A)</p> Signup and view all the answers

Which of the following best describes economic risk?

<p>The possibility of severe economic mismanagement impacting investment (C)</p> Signup and view all the answers

What is a potential consequence of doing business in totalitarian countries?

<p>Support for regimes that violate human rights (B)</p> Signup and view all the answers

Why may international firms face ethical dilemmas regarding standards of product safety?

<p>The disparity in safety standards between home and host countries (D)</p> Signup and view all the answers

What is an important factor that determines the overall attractiveness of a country for investment?

<p>The balance of benefits, costs, and risks involved (B)</p> Signup and view all the answers

What is an implication of cultural differences in the workplace?

<p>Influence on values and workplace behavior (D)</p> Signup and view all the answers

Legal risk primarily involves what aspect of international business?

<p>The chance of contracts being broken by trading partners (B)</p> Signup and view all the answers

What is a common unethical practice that businesses might face in totalitarian markets?

<p>Corruption and manipulation of legal practices (A)</p> Signup and view all the answers

What has contributed to the relative decline of U.S. and British multinationals in the global marketplace?

<p>The globalization of the world economy (C)</p> Signup and view all the answers

Which trend has been observed among smaller firms since the 1960s?

<p>Increased involvement in international trade and investment (A)</p> Signup and view all the answers

What is happening with the economies of most former communist states?

<p>Their economic conditions remain poor and uncertain (B)</p> Signup and view all the answers

What factor has made China emerge as a potential industrial superpower?

<p>Progressive movement towards greater free market reforms (D)</p> Signup and view all the answers

What contributes to the attractiveness of Latin America for foreign direct investment (FDI)?

<p>Reduction in debt and inflation along with privatization of state-owned enterprises (D)</p> Signup and view all the answers

What did the U.S. dominance in multinational enterprises reflect after World War II?

<p>U.S. economic dominance (B)</p> Signup and view all the answers

How have small businesses been contributing to international trade?

<p>Establishing subsidiaries in multiple countries (A)</p> Signup and view all the answers

Which country has been noted for a rapid economic transition towards free markets?

<p>India (B)</p> Signup and view all the answers

What are the major drivers of globalization, according to the provided text? (Select all that apply)

<p>Falling barriers to cross-border trade (A), Technological advancements, such as the internet and communication infrastructure (C), The declining cost of transportation and communication (D)</p> Signup and view all the answers

Which of the following is NOT a company mentioned in the opening case about the globalization of production at Bombardier?

<p>Alstom SA (A)</p> Signup and view all the answers

The "Globalization of Markets" phenomenon refers to:

<p>The consolidation of independent national markets into a single global marketplace (C)</p> Signup and view all the answers

What does the text suggest about the role of labor in globalization?

<p>While labor costs can be cheaper in some countries, it doesn't mean that workers in those countries are exploited. (A)</p> Signup and view all the answers

Which of the following is NOT a facet of globalization mentioned in the text?

<p>Globalization of Government (D)</p> Signup and view all the answers

What is a key characteristic of the globalization of markets?

<p>The convergence of consumer tastes and preferences on a global scale. (D)</p> Signup and view all the answers

Which of the following is an example of a global institution mentioned in the text?

<p>All of the above (D)</p> Signup and view all the answers

What does the text suggest about the impact of globalization on national sovereignty?

<p>Globalization undermines national sovereignty by reducing government control over certain aspects of economy. (C)</p> Signup and view all the answers

What is the main reason why ethical dilemmas are vexing?

<p>They often present multiple possible courses of action, making it difficult to determine the right one. (B)</p> Signup and view all the answers

Which of the following practices is NOT directly related to establishing a strong ethical culture within a business?

<p>Prioritizing financial performance over ethical considerations. (B)</p> Signup and view all the answers

What is the concept of "noblesse oblige" in the context of corporate social responsibility (CSR)?

<p>A moral obligation for businesses to use their power and influence to benefit society. (C)</p> Signup and view all the answers

Which of the following CSR stances is characterized by a company exceeding customer expectations and addressing concerns proactively?

<p>Accommodative stance. (A)</p> Signup and view all the answers

What is the primary reason why multinational corporations are said to have a social responsibility?

<p>They have the power to influence the global economy, and therefore should consider the social impact of their actions. (A)</p> Signup and view all the answers

What does the "obstructionist stance" in regards to CSR entail?

<p>Companies create barriers and make it difficult for customers to voice their concerns. (A)</p> Signup and view all the answers

From the content, how can a manager ensure ethical issues are considered in business decisions?

<p>By ensuring that leaders act in accordance with the ethical rhetoric they preach. (B), By establishing a system where employees are incentivized to prioritize ethical values. (C), By encouraging employees to report any unethical behavior to the highest level of management. (D), By implementing decision-making processes that incorporate ethical dimensions. (E)</p> Signup and view all the answers

What is the main idea of the text regarding ethical decision-making and CSR?

<p>Businesses have a moral obligation to consider the social consequences of their decisions. (D)</p> Signup and view all the answers

Flashcards

Globalization

The process of integrating and connecting economies, societies, and cultures worldwide.

Globalization of Markets

The merging of separate national markets into a single, global marketplace.

Globalization of Production

The sourcing of goods and services from different locations around the world.

Globalization of Consumers

The increasing similarity in consumer tastes and preferences across nations.

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Global Institutions

Organizations that help facilitate international trade and cooperation, such as the World Trade Organization (WTO) and the International Monetary Fund (IMF).

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Drivers of Globalization

Factors that contribute to the increased interconnectedness of the world, including: technological advancements, transportation improvements, reduced barriers to trade, and communication ease.

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Globalization Debate

The debate surrounding the implications of globalization, including its impact on job security, income inequality, labor and environmental policies, and national sovereignty.

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Global Supply Chain Code of Conduct

A code of conduct that outlines ethical and responsible business practices for international operations.

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Innovation

The ability to create new products, processes, organizations, management practices, and strategies that lead to long-term economic growth.

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Entrepreneurship

The process of starting a new business venture, taking risks, and developing ideas into profitable businesses.

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Market Economy

An economic system where private individuals and businesses make most economic decisions, with limited government intervention.

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Property Rights

The right to own and control property, including the ability to profit from innovations.

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Planned Economy

A system where the government controls most aspects of the economy, including production and distribution of goods.

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Democracy

A form of government where citizens have the power to elect their leaders and participate in political decision-making.

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Democratization

The process of transitioning from a non-democratic system to a democratic one, often accompanied by economic growth and development.

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Economic Progress Begets Democracy

The idea that economic growth can lead to the establishment of a democratic political system.

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Rise of Non-U.S. Multinationals

The increase in the number of multinational companies from countries outside of the United States, particularly Japan, due to their economic growth, globalization, and the decline of US and British dominance.

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Growth of Mini-Multinationals

The significant growth in the number of multinational companies from developing economies, especially medium-sized and smaller businesses.

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The Changing World Order

A period characterized by major economic, political, and social changes in several regions, including the former communist states, India, China, and Latin America.

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Economic Transformation in Former Communist States

The economic transformation of former communist states, marked by challenges in transitioning to democracy and free-market economics.

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China's Economic Transformation

China's progressive move towards a free-market economy, characterized by rapid growth and a shift from developing economy to potential industrial superpower.

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Economic Improvements In Latin America

The economic improvements in Latin America, characterized by reduced debt and inflation, privatization of state-owned enterprises, increased foreign direct investment, and economic growth.

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What is Foreign Direct Investment (FDI)?

The practice of companies investing directly in foreign countries, often to establish operations or acquire existing businesses.

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How Small Businesses are Globalizing

The increasing participation of medium-sized and smaller businesses in international trade and investment, often driven by factors such as globalization and technology.

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Totalitarianism

A system of government where the state controls all aspects of public and private life, restricting individual liberties, and suppressing dissent. Citizens are denied fundamental rights like freedom of speech and assembly, and political opposition is outlawed.

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Communist Totalitarianism

A type of totalitarianism where the government ideology is based on Communism, aiming for a classless society by controlling all aspects of the economy and suppressing opposition.

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Theocratic Totalitarianism

A form of totalitarianism where religious teachings form the basis of law and government, and the clergy hold significant power.

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Command Economy

A system where economic decisions are made by the government, determining allocation of resources, production, and prices. Private ownership is limited.

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Mixed Economy

A system where some industries are privately owned and operate under market forces, while others are under government control and planning.

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Common Law

A system of law based on tradition, precedent, and custom, relying on interpretations of existing laws through court rulings.

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Civil Law

A system of law based on a comprehensive set of written laws and codes, providing clear and detailed rules for all legal matters.

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Contract

A document defining the terms of an exchange, specifying the rights and obligations of each party involved in the agreement.

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Political Risk

The likelihood that political forces will significantly alter a country's business environment, negatively impacting a company's profitability and goals.

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Economic Risk

The possibility that economic mismanagement will drastically change a country's business environment, harming a company's profits and objectives.

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Legal Risk

The chance that a trading partner will act unfairly, breaking a contract or taking property rights without proper compensation.

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Overall Attractiveness for International Business

The overall attractiveness of a country as a place for market penetration and investment depends on balancing the potential benefits, costs, and risks associated with doing business there.

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Ethics of Doing Business in Totalitarian Countries

A moral dilemma faced by firms originating from democratic nations when considering business opportunities in totalitarian countries with human rights violations.

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International Ethical Standards

The ethical challenge of whether international companies should maintain the same safety and environmental standards in foreign countries as they do in their home countries.

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Culture of a Society

The study of the shared values, beliefs, behaviors, and customs of a particular group of people.

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Forces that Lead to Cultural Differences

The factors that contribute to the distinct cultural differences between societies and the impact these differences have on business operations and economic activity.

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Ethical Dilemmas

Difficult ethical situations where there's no easy right answer, making it challenging to choose the appropriate course of action.

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Corporate Social Responsibility (CSR)

The idea that businesses need to consider the social impacts of their decisions, prioritizing choices that benefit both society and the company.

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Obstructionist Stance (CSR)

Companies that are resistant to addressing customer concerns and often create barriers that make it difficult to raise these issues.

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Defensive Stance (CSR)

Companies that deny responsibility for any issues raised by customers, even when evidence points otherwise.

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Accommodative Stance (CSR)

Companies that exceed customer expectations, going beyond the minimum to address concerns effectively.

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Proactive Stance (CSR)

Companies that proactively address issues as soon as they arise and transparently inform customers of their actions.

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Noblesse Oblige

The obligation of powerful individuals or entities to use their influence and resources for the benefit of society.

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Moral Courage

The quality of having the courage to stand up for what is morally right, even when it's difficult or risky.

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Study Notes

Course Outline

  • Don't need textbook, connect available online
  • Risk assignment (presentation) February 12th
  • Risk Management Country Assignment (presentation)
  • Group size is 3-6 members per group
  • Presentation assignment requires 3-5 pages (15%)
  • Students can choose 3 countries (from different continents)
  • Final exam: 50-60 multiple choice questions, 2-3 case studies
  • Course project: team-based

Chapter 1 - Globalization

  • Learning Objectives:
    • Define globalization, globalization of markets, globalization of production
    • Examine global institutions and their functions
    • Examine Globalization Drivers
    • Illustrate changes in global economy demographics
    • Understand the globalization debate; impact on job security, income, labor & environmental policies, and national sovereignty
    • Understand opportunities & challenges for business managers in Canada & beyond
    • Understand establishing & committing to a global supply chain code of conduct
    • Understand how establishing a global supply chain code of conduct results in sustainable operations
  • Labor costs are lower in some countries
  • China and India were the last two countries to join globalization
  • Opening Case: Globalization of Production at Bombardier - case study details included (DMC, Kobe Steel, Chengdu Sigma Precision Components, Chemetall GMBH, Cheltenham Tool Co., Centro Tratamientos, and Castle Metals)
  • Lack of barriers to trade and investment (transportation, commercial line)

Other General Information

  • Several companies involved in globalization cases, locations of these companies (US, Japan, China, Germany, UK, Spain, Mexico)
  • Important global institutions like the United Nations, World Trade Organization (WTO), International Monetary Fund (IMF), World Bank also mentioned.

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INBU 3301-002 Globalization Course Outline PDF

Description

Test your understanding of the key concepts from Chapter 1 on globalization. This quiz covers definitions, global institutions, drivers of globalization, and the related economic impact. Assess your knowledge of the opportunities and challenges faced by business managers in a global context.

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