101.Which of the following terms best represents the systematic reductions in production costs that have been observed to occur over the life of a product?
A. Global web
B. Dispersion linkage
C. Economies of scale
D. Experience curve
E. Efficiency frontier
102.Serving a global market from a single location is consistent with:
A. establishing a high-cost position.
B. taking advantage of location economies.
C. moving down the experience curve.
D. operating from a position which falls inside the efficiency frontier.
E. going up the global web.
103.Firms that compete in the global marketplace typically face two types of competitive pressure: pressures for _____ and pressures to _____.
A. increasing investment; minimize consumer surplus
B. labor skill enhancement; minimize economies of scale
C. cost reductions; be locally responsive
D. global promotions; move down the efficiency frontier
E. product standardization; move up the experience curve
104.Why do companies find dealing with high pressures for both, cost reductions and local responsiveness, a difficult strategic challenge?
A. Cost reductions are inversely proportional to standardization.
B. Being locally responsive tends to raise costs.
C. Cost reductions negatively impact maximization of single-plant utilization.
D. As the quantity produced goes on increasing, it becomes more difficult for a company to achieve economies of scale.
E. Customer tastes are usually identical across global markets.
105.Cost reduction pressures tend to be particularly intense in industries that:
A. create products that serve universal needs.
B. create customized products.
C. are not involved in international business.
D. produce products that have inelastic demand.
E. serve different customers with different needs.
106.Which of the following terms best represents the requirements that are the same all over the world, such as steel, bulk chemicals, and industrial electronics?
A. Universal needs
B. Efficiency frontier
C. Global web
D. Lateral requirements
E. Supreme needs
107.Pressures for cost reduction are intense in:
A. firms which produce products that are well differentiated.
B. firms whose major competitors are based in high-cost locations.
C. firms with persistent low capacity.
D. firms in which consumers face low switching costs.
E. firms with no international competition.
108.The liberalization of the world trade and investment environment in recent decades, by facilitating greater international competition, has generally:
A. increased cost pressures.
B. decreased the demand for local responsiveness.
C. decreased pressures for cost reduction.
D. increased consumer surplus.
E. reduced the production of conventional commodity products.
109.Which of the following conditions is most favorable to reap gains from global scale economies?
A. Low demand for local responsiveness
B. High pressures for cost reduction
C. Lack of universal needs
D. National differences in accepted business practices
E. High pressure to delegate production to domestic subsidiaries
110.Which of the following supports the argument that customer demands for local customization are on the decline worldwide?
A. Local and indigenous industries are increasingly filling up available demand.
B. High costs of local customization are deterring companies from doing so.
C. Governments across the world are standardizing their legal procedures.
D. Customer tastes have converged worldwide.
E. Managers worldwide ignore the differences in consumer tastes and preferences.
