Your Results: The correct answer for each question is indicated by a . 1 CORRECT Companies opt to expand into foreign markets for such reasons as to A) boost returns on investment, broaden their product lines, avoid tariffs and trade restrictions, and escape having to deal with strong labor unions. B) gain access to new customers, achieve lower costs and enhance the company's competitiveness, capitalize on core competencies, and spread business risk across a wider market base. C) grow sales faster than the industry average, reduce the competitive threats from rivals, and open up more opportunities to enter into strategic alliances. D) avoid having to employ an export strategy, avoid the threat of cross-market subsidization from rivals, and enable the use of a global strategy instead of a multicountry strategy. E) raise the entry barriers for industry newcomers, neutralize the bargaining power of important suppliers, grow sales faster, and increase the number of loyal customers. 2 CORRECT Which one of the following is not a factor that a company must contend with in competing in the markets of foreign countries? A) Variations in market growth rates from country to country and important country-to- country differences in consumer buying habits and buyer tastes and preferences B) Country-to-country variations in host government policies and trade requirements C) The fact that product designs suitable for one country are sometimes inappropriate in another D) Vulnerability to adverse shifts in currency exchange rates E) A need to convince shippers to keep cross-country transportation costs low 3 CORRECT Which one of the following statements concerning the effects of fluctuating exchange rates on companies competing in foreign markets is true? A) Domestic companies trying to combat competition from foreign imports are hurt even more when their government's currency grows weaker in relation to the currencies of the countries where the imported goods are being made.
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- Spring '13
- Management, Foreign Markets, country markets