The ownership of foreign bonds is an example of a portfolio investment.
Answer: TRUE
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Multinational Business Chapter 1
- In a short essay, identify and explain three competitive factors that influence international businesses.
- What is foreign direct investment? What social factors in the external environment might affect FDI?
- What is a multinational enterprise (MNE)? How do physical and social factors affect how an MNE functions in a foreign country?
- What is globalization? What modes of international business are used by firms that want to globalize? Briefly describe each method.
- What are the differences between merchandise and service imports and exports? Provide examples to illustrate your answer.
- What is international business? What are the primary reasons that companies engage in international business?
- In a short essay, discuss why governments have been liberalizing cross-border movements of goods, services, and resources.
- What are three factors that have led to the increased growth in international business in recent decades? Which do you think has been most important and why?
- Why should domestic managers have an understanding of globalization and international business? What are the current views regarding the future of globalization?
- The view that regionalization, rather than globalization, will prevail in the future is largely based on the use of common languages among countries in a region.
- The fact that a company is the market leader in one country is no guarantee that it will be the leader in another country.
- A company with limited resources is more likely to achieve national distribution within a small country than within a large country.
- Managers need to understand not only the laws of countries where they operate, but also how those laws are enforced.
- Geographical barriers typically affect distribution channels within countries, but they rarely affect distribution channels between countries.
- The terms multinational corporation and multinational company are frequently used synonyms for strategic alliances.
- A joint venture is an example of a portfolio investment.
- When a U.S. citizen flies Japan Airlines, the airline acts as a service exporter for Japan.
- The production of goods by a French company in Italy for sale in Italy is an example of an Italian merchandise import.
- By operating internationally, a company may take advantage of business-cycle differences among countries and thereby reduce its financial risks.
- Many professional basketball teams recruit tall youngsters in foreign countries into basketball camps where they can develop basketball skills and perhaps become candidates for professional play. This is an example of engaging in international business to acquire resources.
- Critics of offshoring assert that the short-term cost savings derived from offshoring hinder firms from developing more efficient production methods.
- The process of shifting production to a foreign country is known as outsourcing.
- A criticism of globalization is that as economic growth increases, too many nonrenewable resources are used.
- Supporters of globalization assert that the process helps countries strengthen their sovereignty.
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