International Business: The New Realities 5th edition by S Tamer Cavusgil test bank
Answer:
a. Architectural, construction, and engineering-Activities within this sector include construction, electric power utilities, design, and engineering services for airports, hospitals, and dams. Companies within this sector include ABB, Bechtel Group, Halliburton, Kajima, Philip Holzman, and Skanska AB.
b. Banking, finance, and insurance-Activities within this sector include banking services, insurance provision, risk evaluation, and financial management. Companies within this sector include CIGNA, Barclays, HSBC, and Ernst & Young.
c. Education, training, and publication-Activities within this sector include management training, technical training, and English language training. Companies within this sector include Berlitz, Kumon Math & Reading Centers, NOVA, Pearson, and Elsevier.
Diff: 1: Easy
Skill: Concept
Objective: 1-1: Describe the key concepts in international business
AACSB: Application of Knowledge
35) In a short essay, explain the meaning of international trade. Describe the two major forms through which international trade takes place.
Answer: International trade describes the exchange of products and services across national borders. Trade involves both products (merchandise) and services (intangibles). Exchange can occur through exporting, an entry strategy involving the sale of products or services to customers located abroad, from a base in the home country or a third country. Exchange also can take the form of importing or global sourcing—the procurement of products or services from suppliers located abroad for consumption in the home country or a third country. While exporting represents the outbound flow of products and services, importing is an inbound activity. Both finished products and intermediate goods (for example, raw materials and components) can be imported and exported.
Diff: 1: Easy
Skill: Synthesis
Objective: 1-1: Describe the key concepts in international business
AACSB: Analytical Thinking
36) What is international business, and how has it transformed the world economy?
Answer: International business refers to the performance of trade and investment activities by firms across national borders. Because it emphasizes crossing national boundaries, we also refer to international business as cross-border business. Firms organize, source, manufacture, market, and conduct other value-adding activities on an international scale. They seek foreign customers and engage in collaborative relationships with foreign business partners.
International business is transforming the world as never before. In the last 50 years, international trade and investment have experienced unprecedented growth. Since the 1980s, emerging markets have provided new impetus to worldwide economic interconnectedness. These fast-growth developing economies—some thirty countries, including Brazil, Russia, India, and China, the so-called BRICs—are experiencing substantial market liberalization, privatization, and industrialization, which are fueling global economic transformation.
Along with market globalization, advances in technology is another megatrend helping to transform the global economy. The rise of information and communication technologies, as well as production and process technologies, has dramatically reduced the cost of conducting business with customers located around the world. E-commerce makes international business increasingly imperative for firms of all sizes and resource levels. Technological advances are allowing globalization to progress more rapidly. Globalization, in turn, is accelerating the development of the latest technologies.
Diff: 2: Moderate
Skill: Synthesis
Objective: 1-1: Describe the key concepts in international business
AACSB: Analytical Thinking
37) Which of the following types of risk is also known as political risk?
A) currency risk
B) cross-cultural risk
C) commercial risk
D) country risk
Answer: D
Diff: 1: Easy
Skill: Concept
Objective: 1-2: Understand how international business differs from domestic business