International Business and Political Systems Quiz

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Questions and Answers

What is the focus of comparative international management?

Exploring cultural issues

Exploring national patterns of development (correct)

Analyzing acceptable management practice

Managing businesses outside of national boundaries

What does cross cultural management give particular analytical significance to?

Sociocultural issues

Political systems

Legal systems

National culture (correct)

What are the complexities that arise when operating at the international level?

Marketing, financial, operational, human resources

Political, legal, cultural, sociocultural (correct)

Economic, technological, environmental, ethical

Strategic, tactical, organizational, interpersonal

What is the focus of international management?

Managing a business outside of national boundaries Signup and view all the answers

What are the most appropriate ways for firms to internationalize?

Exporting, licensing, franchising, mergers, acquisitions, strategic alliances, joint ventures Signup and view all the answers

How can firms develop the managerial talents and capabilities for international success?

Training, mentoring, global exposure, cultural sensitivity Signup and view all the answers

What did Levitt predict about the global market?

Standardized products sold everywhere and homogenized tastes and preferences Signup and view all the answers

What is the main consequence of globalization at the firm level?

New business opportunities and intense rivalry from foreign competitors Signup and view all the answers

According to the text, what is hyperglobalization characterized by?

Convergence towards a global system Signup and view all the answers

What is the most global function of a company according to the text?

Advertising, avoiding controversial themes in local markets Signup and view all the answers

What are the dimensions/manifestations of globalization mentioned in the text?

Integration and interdependence of national economies, growth of regional economic integration blocks, and global investment in financial flows Signup and view all the answers

What is the significance of the phases of globalization mentioned in the text?

They have seen significant global developments and technological advancements Signup and view all the answers

Which agency is responsible for attracting and retaining inward FDI into Ireland?

IDA Ireland Signup and view all the answers

What is the second most attractive country globally for Foreign Direct Investment (FDI)?

Singapore Signup and view all the answers

Which theory suggests that MNCs need to develop dynamic capabilities for sustained competitive advantage?

Dynamic capability theory Signup and view all the answers

What is the most important capability for MNCs to develop, according to the text?

Knowledge transfer Signup and view all the answers

Which model outlines the determinants of national competitiveness, including demand conditions and firm strategy?

The Porter Diamond Model Signup and view all the answers

What is the process that involves stages from domestic focus to committed involvement?

The internationalization process of the firm Signup and view all the answers

What is offshoring in the context of MNCs?

Outsourcing production to countries with cheaper labor Signup and view all the answers

What is a consequence of the globalization of markets?

Successful firms can adapt products to diverse market tastes at competitive prices Signup and view all the answers

What does globalization of production allow companies to do?

Break down manufacturing processes into separate stages, each in the most advantageous location Signup and view all the answers

What are some impacts of globalization mentioned in the text?

Economic impacts, diffusion of technology, changes in global financial markets, culture, and the environment Signup and view all the answers

What is a consequence of technological advances in the context of MNCs?

Transformed business functions and operations, creating a global platform for interaction and transactions Signup and view all the answers

What impact has globalization had on the national identity of brands?

The national identity of brands has become increasingly blurred due to globalization Signup and view all the answers

According to Dunning's Eclectic Paradigm, what are the three conditions for companies to internationalize through FDI?

Ownership-specific advantages, location-specific advantages, and internationalization advantages Signup and view all the answers

What does social democracy support?

Economic and social intervention for social justice through democratic means Signup and view all the answers

What does democracy emphasize?

Accountability to the voting public through free elections Signup and view all the answers

What is the emphasis of Monopolistic advantage theory in internationalization strategy through FDI?

The need for firms to have unique resources and capabilities Signup and view all the answers

What do political systems consist of?

Formal institutions like legislative bodies, political parties, and trade unions Signup and view all the answers

What do legal systems establish norms for?

Conduct, resolving disputes, and providing protections for private property and company assets Signup and view all the answers

What are the complexities that arise when operating at the international level, according to the text?

Political, legal, cultural, sociocultural Signup and view all the answers

What is the focus of cross cultural management?

National culture as the key variable when examining acceptable management practice Signup and view all the answers

What is the most appropriate way for firms to internationalize, according to the text?

Exporting, licensing, franchising, mergers, acquisitions, strategic alliances, joint ventures Signup and view all the answers

How can firms develop the managerial talents and capabilities for international success, according to the text?

By ensuring that managers can be a success internationally Signup and view all the answers

Which company is described as a global brand with approximately 205 beverage brands worldwide and the highest brand recognition globally?

Coca Cola Signup and view all the answers

What did Levitt predict about the global market?

Standardized products and homogenized tastes Signup and view all the answers

What is hyperglobalization characterized by?

Convergence towards a global system Signup and view all the answers

What does the globalization of markets involve?

Ongoing economic integration and declining trade barriers Signup and view all the answers

What did Freidmann (1999) describe the world as?

A single globalized marketplace and village driven by free market capitalism Signup and view all the answers

What are the dimensions/manifestations of globalization mentioned in the text?

Integration and interdependence of national economies Signup and view all the answers

What is the focus of international management?

Managing global operations and strategies Signup and view all the answers

What are the drivers of globalization mentioned in the text?

Worldwide reduction of barriers to trade and investment Signup and view all the answers

What is the main consequence of globalization at the firm level?

New business opportunities and intense rivalry from foreign competitors Signup and view all the answers

What does the value chain allow companies to do?

Outsource value-chain activities, leading to globalization Signup and view all the answers

What are the phases of globalization mentioned in the text?

1800-1850, 1900-1930, 1948-1970, 1980s, and 2007 Signup and view all the answers

What is the most global function of a company according to the text?

Advertising, avoiding controversial themes in local markets Signup and view all the answers

What is the main consequence of offshoring by large MNCs?

Lay-offs in some countries Signup and view all the answers

What does globalization of markets allow successful firms to do?

Adapt products to diverse market tastes at competitive prices Signup and view all the answers

What does globalization of production allow companies to do?

Break down manufacturing processes into separate stages, each in the most advantageous location Signup and view all the answers

What has globalization led to in terms of economic impacts?

Diffusion of technology and changes in global financial markets Signup and view all the answers

What do the social impacts of globalization include?

Both benefits and adverse effects on host and home societies Signup and view all the answers

What do technological advances such as IT and digitization allow for?

Transforming business functions and operations on a global scale Signup and view all the answers

What have MNEs/MNCs benefited from?

Economies of scale and scope Signup and view all the answers

What has globalization led to in terms of the national identity of brands?

Increasingly blurred national identity of brands Signup and view all the answers

What percentage of the world's industrial output and world trade is generated by over 60,000 MNCs with more than 800,000 affiliates?

50% of the world's industrial output and 2/3 of world trade Signup and view all the answers

What has made Ireland the hub of European operations for MNCs in specific industries?

MNCs in ICT, social media, pharmaceuticals, and finance Signup and view all the answers

What factors are influencing the debate about the end of globalization?

BREXIT, Trump's policies, and China's role in the global economic order Signup and view all the answers

Which theory suggests that MNCs need to develop dynamic capabilities for sustained competitive advantage?

Dynamic capability theory Signup and view all the answers

Which agency is responsible for attracting and retaining inward FDI into Ireland?

IDA Ireland Signup and view all the answers

What is the second most attractive country globally for Foreign Direct Investment (FDI)?

Singapore Signup and view all the answers

What is the most important capability for MNCs to develop, according to the text?

Knowledge transfer Signup and view all the answers

What does the Porter Diamond Model outline as determinants of national competitiveness?

Demand conditions, firm strategy, structure and rivalry, factor conditions, related and supporting industries, and national industrial policy Signup and view all the answers

What theories are included in the theories on international trade mentioned in the text?

Free trade, comparative advantage, competitive advantage, and factors like natural endowments and deliberate national practices Signup and view all the answers

What do Mercantilism and neo-mercantilism influence in trade policies and beliefs?

Affecting imports, exports, and trade surpluses Signup and view all the answers

What is the focus of the internationalization process of the firm?

Stages from domestic focus to committed involvement Signup and view all the answers

What does the absolute advantage theory guide countries in producing and trading efficiently?

Based on their ability to produce goods more efficiently than other countries Signup and view all the answers

What is the emphasis of the theories on international trade and investment mentioned in the text?

Determining factors that influence global competitiveness and trade policies Signup and view all the answers

What are the determinants of national competitiveness outlined in the Porter Diamond Model?

Demand conditions, firm strategy, structure and rivalry, factor conditions, related and supporting industries, and national industrial policy Signup and view all the answers

What do MNCs need organizational capabilities for, according to the text?

To extend and exploit their superior knowledge throughout their operations Signup and view all the answers

What does Monopolistic advantage theory emphasize for internationalization strategy through FDI?

The need for firms to have unique resources and capabilities Signup and view all the answers

What does Internationalization theory explain the process of firms acquiring and retaining?

Value-chain activities inside the company Signup and view all the answers

What are the three conditions proposed by Dunning's Eclectic Paradigm for companies to internationalize through FDI?

Ownership-specific advantages, location-specific advantages, and internationalization advantages Signup and view all the answers

What do political systems consist of?

Formal institutions like legislative bodies, political parties, and trade unions Signup and view all the answers

What do legal systems establish norms for?

Conduct, resolving disputes, and providing protections for private property and company assets Signup and view all the answers

What are the dimensions of country risk in international business?

Harmful or unstable political systems, unfavorable laws and regulations, inadequate legal systems, bureaucracy, corruption, and government intervention Signup and view all the answers

What key players are involved in the political environment?

Government, political parties, trade unions, interest groups, and public opinion Signup and view all the answers

What are the different political systems mentioned in the text?

Authoritarianism, socialism, and democracy Signup and view all the answers

What does social democracy support?

Economic and social intervention for social justice through democratic means Signup and view all the answers

What is democracy characterized by?

Accountability to the voting public through free elections, private property rights, limited government, openness, and a lack of excessive regulation Signup and view all the answers

What is the focus of political constraints and risks in international business?

Inherent in conducting business across national boundaries Signup and view all the answers

What do international businesses face demands from in various environments?

Various environments, including political and legal constraints Signup and view all the answers

Study Notes

International Business and Political Systems

Monopolistic advantage theory emphasizes the need for firms to have unique resources and capabilities for internationalization strategy through FDI.
Internationalization theory explains the process of firms acquiring and retaining value-chain activities inside the company to gain control over foreign operations.
Dunning's Eclectic Paradigm proposes three conditions for companies to internationalize through FDI: ownership-specific advantages, location-specific advantages, and internationalization advantages.
Political systems consist of formal institutions like legislative bodies, political parties, and trade unions, constantly evolving to meet constituent demands.
Legal systems interpret and enforce laws, establishing norms for conduct, resolving disputes, and providing protections for private property and company assets.
International businesses face demands from various environments, and political constraints and risks are inherent in conducting business across national boundaries.
Country risk in international business includes exposure to potential loss or adverse effects due to developments in a country’s political and/or legal environment.
Dimensions of country risk include harmful or unstable political systems, unfavorable laws and regulations, inadequate legal systems, bureaucracy, corruption, and government intervention.
Political environment key players include government, political parties, trade unions, interest groups, and public opinion, which can influence tax rates, tariffs, and regulations.
Authoritarianism, socialism, and democracy are different political systems with varying levels of government control, individual rights, and economic ideologies.
Social democracy supports economic and social intervention for social justice through democratic means and is associated with high corporate tax rates.
Democracy is characterized by accountability to the voting public through free elections, private property rights, limited government, openness, and a lack of excessive regulation.

Ireland's Foreign Direct Investment and Theories on International Trade and Investment

Ireland is the second most attractive country globally for Foreign Direct Investment (FDI), following Singapore.
IDA Ireland is the agency responsible for attracting and retaining inward FDI into Ireland.
Service multinational corporations (MNCs) in sectors like media, education, information services, travel, tourism, healthcare, and professional services are growing in Ireland due to economic transformation, regulatory systems, and communication advances.
MNCs have a competitive advantage with global scale, large capital, human resources, brand, and technological base.
Dynamic capability theory suggests that MNCs need to develop dynamic capabilities to create, deploy, and upgrade resources for sustained competitive advantage.
MNCs need organizational capabilities to extend and exploit their superior knowledge throughout their operations.
Knowledge transfer is the most important capability for MNCs to develop.
Theories on international trade include free trade, comparative advantage, competitive advantage, and factors like natural endowments and deliberate national practices.
Mercantilism and neo-mercantilism influence trade policies and beliefs, affecting imports, exports, and trade surpluses.
The principles of absolute advantage and comparative advantage guide countries in producing and trading goods efficiently.
The Porter Diamond Model outlines the determinants of national competitiveness, including demand conditions, firm strategy, structure and rivalry, factor conditions, related and supporting industries, and national industrial policy.
The internationalization process of the firm involves stages from domestic focus to committed involvement, with born global firms being young firms that aggressively pursue foreign markets.

International Business and Political Systems

Monopolistic advantage theory emphasizes the need for firms to have unique resources and capabilities for internationalization strategy through FDI.
Internationalization theory explains the process of firms acquiring and retaining value-chain activities inside the company to gain control over foreign operations.
Dunning's Eclectic Paradigm proposes three conditions for companies to internationalize through FDI: ownership-specific advantages, location-specific advantages, and internationalization advantages.
Political systems consist of formal institutions like legislative bodies, political parties, and trade unions, constantly evolving to meet constituent demands.
Legal systems interpret and enforce laws, establishing norms for conduct, resolving disputes, and providing protections for private property and company assets.
International businesses face demands from various environments, and political constraints and risks are inherent in conducting business across national boundaries.
Country risk in international business includes exposure to potential loss or adverse effects due to developments in a country’s political and/or legal environment.
Dimensions of country risk include harmful or unstable political systems, unfavorable laws and regulations, inadequate legal systems, bureaucracy, corruption, and government intervention.
Political environment key players include government, political parties, trade unions, interest groups, and public opinion, which can influence tax rates, tariffs, and regulations.
Authoritarianism, socialism, and democracy are different political systems with varying levels of government control, individual rights, and economic ideologies.
Social democracy supports economic and social intervention for social justice through democratic means and is associated with high corporate tax rates.
Democracy is characterized by accountability to the voting public through free elections, private property rights, limited government, openness, and a lack of excessive regulation.

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Description

Test your knowledge of international business and political systems with this quiz. Learn about theories of internationalization, political and legal systems, country risk, and different political environments. Gain insight into how these factors impact the conduct of business across national boundaries.