Question 1

_____ techniques are designed to help the overseas operation become part of the host country's infrastructure.

Accepted Answer

A)  Protective
B)  Defensive
C)  Integrative
D)  Statutory

Question 2

Foreign ownership limitations, pressure for local participation, confiscation, expropriation, and abrogation of property rights are examples of:

Accepted Answer

A)  Transfer risks
B)  Functional risks
C)  Ownership-control risks
D)  Tactical risks

Question 3

In a _____ investment, the goods or services produced are not similar to those produced at home.

Accepted Answer

A)  Horizontal
B)  Vertical
C)  Network
D)  Conglomerate

Question 4

_____ techniques are designed to discourage the host government from interfering in operations.

Accepted Answer

A)  Integrative and unifying
B)  Consolidating and defensive
C)  Protective and unifying
D)  Protective and defensive

Question 5

When host governments do not require alliances as a condition for entry, many MNCs:

Accepted Answer

A)  Are advised not to voluntarily pursue alliances as they tend to be problematic
B)  Are usually indifferent about establishing alliances
C)  Find that having an alliance is advantageous to their entry and expansion
D)  Are likely to consider alliances, except in emerging markets and highly regulated industries

Question 6

Macro risk issues often take forms such as industry regulations, taxes of specific types of business activity, and various restrictive local laws.

Accepted Answer

A) True 
 B)False

Question 7

Micro political risk analysis is directed toward government policies and actions that influence selected sectors of the economy or specific foreign businesses.

Accepted Answer

A) True 
 B)False

Question 8

According to the text, the following are all forms of terrorism except:

Accepted Answer

A)  Classic terrorism
B)  Amateur terrorism
C)  Religious motivated terrorism
D)  Political terrorism

Question 9

In some instances, it is not clear whether macro or micro political risk is at work.

Accepted Answer

A) True 
 B)False

Question 10

_____ investments typically are made with an eye toward satisfying the host country's market demands.As a result, they are not very likely to be takeover targets.

Accepted Answer

A)  Vertical
B)  Horizontal
C)  Conglomerate
D)  Hierarchical

Question 11

Broadly, ________ strategies may include leveraging bilateral, regional, and international trade and investment agreements, drawing on bilateral and multilateral financial support, and using project finance structures to separate project exposure from overall firm risk.

Accepted Answer

A)  protective and defensive
B)  vertical investment
C)  integrative
D)  proactive political strategies

Question 12

Comprehensive political strategies are most important in stable policy environments.

Accepted Answer

A) True 
 B)False

Question 13

In the context of international strategic alliances, value-claiming activities are competitive and distributive.

Accepted Answer

A) True 
 B)False

Question 14

MNCs can take a wide variety of strategies to minimize their chances of expropriation.Those strategies do not include:

Accepted Answer

A)  bringing in local partners
B)  avoiding countries that have experienced a terrorist incident
C)  limiting the use of high technology so that if the firm is expropriated, the country cannot duplicate the technology
D)  acquiring an affiliate that depends on the parent company for key areas of the operation

Question 15

Expropriation is more likely to occur in:

Accepted Answer

A)  Non-Western governments that are poor, relatively unstable, and suspicious of foreign multinationals
B)  Western governments that are rich, relatively stable, and are experienced in dealing with foreign multinationals
C)  Non-Western governments that are neither rich nor poor, relatively stable, and are unsure about the presence of foreign multinationals
D)  Western governments that are moderately wealthy, relatively stable, and are new at dealing with foreign multinationals

Exam 10: Managing Political Risk, Government Relations, and Alliances

Foreign ownership limitations, pressure for local participation, confiscation, expropriation, and abrogation of property rights are examples of:

Correct Answer
verified

Micro political risk analysis is directed toward government policies and actions that influence selected sectors of the economy or specific foreign businesses.

Correct Answer
verified

In a _____ investment, the goods or services produced are not similar to those produced at home.

Correct Answer
verified

When host governments do not require alliances as a condition for entry, many MNCs:

Correct Answer
verified

According to the text, the following are all forms of terrorism except:

Correct Answer
verified

Comprehensive political strategies are most important in stable policy environments.

Correct Answer
verified

In some instances, it is not clear whether macro or micro political risk is at work.

Correct Answer
verified

Expropriation is more likely to occur in:

Correct Answer
verified

MNCs can take a wide variety of strategies to minimize their chances of expropriation.Those strategies do not include:

Correct Answer
verified

_____ investments typically are made with an eye toward satisfying the host country's market demands.As a result, they are not very likely to be takeover targets.

Correct Answer
verified

_____ techniques are designed to help the overseas operation become part of the host country's infrastructure.

Correct Answer
verified

In the context of international strategic alliances, value-claiming activities are competitive and distributive.

Correct Answer
verified

_____ techniques are designed to discourage the host government from interfering in operations.

Correct Answer
verified

Macro risk issues often take forms such as industry regulations, taxes of specific types of business activity, and various restrictive local laws.

Correct Answer
verified

Broadly, ________ strategies may include leveraging bilateral, regional, and international trade and investment agreements, drawing on bilateral and multilateral financial support, and using project finance structures to separate project exposure from overall firm risk.

Correct Answer
verified

Exam 10: Managing Political Risk, Government Relations, and Alliances

Foreign ownership limitations, pressure for local participation, confiscation, expropriation, and abrogation of property rights are examples of:

Correct AnswerverifiedShow Answer

Micro political risk analysis is directed toward government policies and actions that influence selected sectors of the economy or specific foreign businesses.

Correct AnswerverifiedShow Answer

In a _____ investment, the goods or services produced are not similar to those produced at home.

Correct AnswerverifiedShow Answer

When host governments do not require alliances as a condition for entry, many MNCs:

Correct AnswerverifiedShow Answer

According to the text, the following are all forms of terrorism except:

Correct AnswerverifiedShow Answer

Comprehensive political strategies are most important in stable policy environments.

Correct AnswerverifiedShow Answer

In some instances, it is not clear whether macro or micro political risk is at work.

Correct AnswerverifiedShow Answer

Expropriation is more likely to occur in:

Correct AnswerverifiedShow Answer

MNCs can take a wide variety of strategies to minimize their chances of expropriation.Those strategies do not include:

Correct AnswerverifiedShow Answer

_____ investments typically are made with an eye toward satisfying the host country's market demands.As a result, they are not very likely to be takeover targets.

Correct AnswerverifiedShow Answer

_____ techniques are designed to help the overseas operation become part of the host country's infrastructure.

Correct AnswerverifiedShow Answer

In the context of international strategic alliances, value-claiming activities are competitive and distributive.

Correct AnswerverifiedShow Answer

_____ techniques are designed to discourage the host government from interfering in operations.

Correct AnswerverifiedShow Answer

Macro risk issues often take forms such as industry regulations, taxes of specific types of business activity, and various restrictive local laws.

Correct AnswerverifiedShow Answer

Broadly, ________ strategies may include leveraging bilateral, regional, and international trade and investment agreements, drawing on bilateral and multilateral financial support, and using project finance structures to separate project exposure from overall firm risk.

Correct AnswerverifiedShow Answer

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