Chapter Quiz 9

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An example of a country with an advanced economy is:

____________________ .
Brazil

Russia

Japan

South Korea

In spite of relying on per-capita income even after adjusted

for PPP as an indicator of market potential in emerging
economies, managers should still exercise caution due to
which of the following reasons?
the "informal" economy of developing economies

under-reporting of national income by country governments

multiple wage earners per household in these countries

all of the above

One way to illustrate the PPP concept is to utilize the renown

________.
S & P Index

Big Mac Index

Russell 2000 Index

Wilshire 5000 Index

Name the country which represents a developing economy.

Bangladesh

New Zealand

France

Canada

________ help(s) foreign firms become more efficient,

concentrate on their core competencies, and obtain
competitive advantages.
Key success factors

Outsourcing

Focus strategies

Mercantilism
According to the text, an example of a "new global
challenger" is: ____________________ .
Microsoft

MoDoCo

Orascom Telecom

Alcatel-Lucent

The transfer of state-owned industries to private concerns is

called: ____________________ .
transitional feat

transformational undertaking

statehood

privatization

The procurement of products and services from foreign

locations either from independent suppliers or company-
owned subsidiaries is called: ____________________ .
outsourcing

offshore outsourcing

strategic formulation

global sourcing
Name the country which is one of the largest emerging
markets.
Brazil

Japan

Chad

Zaire

________ are a subset of emerging markets that have

transformed from a centrally planned economy into a
liberalized market.
Transition economies

Advanced economies

Developed economies

None of the above

In the early stages of market research, managers utilize three

practical approaches to estimate the true potential of
emerging markets. Which one of the following approaches is
NOT utilized?
the use of per-capita income
 the size of the middle class

market potential indicators

the number of internet users per 1,000 people

Which country currently classified as a developing economy

has the potential to become an emerging market in the near
future?
Zaire

Lithuania

Monaco

Luxembourg

According to the text, of the three types of country groups,

which one has the highest telephone lines per 1,000 people?
developing economies

emerging markets

advanced economies

informal economies

The combination of ________ and ________ tends to

perpetuate poverty in developing economies.
low birth rates; low income

low income; high birth rates

high birth rates; high GDP

low birth rates; malnutrition

________ percent of the world's population are represented

by advanced economies.
Two

Fifty

Fourteen

None of the above

Because China is the largest emerging market in the world,

foreign companies wanting to do business in China, can easily
be successful.

True

False
GDP growth is greater in advanced economies as compared
to emerging markets.

True

False

There are risks involved in doing business in emerging

markets including red tape, lack of transparency, and
political instability.

True

False

An emerging market is a subset of former developing

economies that has achieved substantial industrial and rapid
economic growth.

True

False

When estimating the true potential of emerging markets, the

size of the middle class is a good indicator to use.

True
 False

Generally speaking, advanced economies have totalitarian

governments.

True

False

In the 2006 World Bank's, "Ease of Doing Business"

rankings, Russia ranked 163rd in dealing with licenses.

True

False

It has been proven that microfinancing does not facilitate

entrepreneurship in poor countries.

True

False
Emerging market governments regularly announce
"tenders" or formal offers made by a buyer to purchase
certain products or services.

True

False

According to the Big Mac Index, the cheapest place in the

world to buy a Big Mac is in Norway.

True

False

A family conglomerate is a large, privately-owned company

that is highly diversified like Siam Cement Group in
Thailand.

True

False

Intellectual property protection is weakest in emerging

market economies versus developing economies.
 True

False

Advanced economies cannot challenge emerging markets due

to the emerging market's rapid growth rate.

True

False

Firms are increasingly targeting emerging markets utilizing

per capita GDP adjusted for PPP, in spite of the emerging
market's low levels of income.

True

False

MNE's are just now setting up manufacturing platforms for

cars and consumer electronics in emerging markets.

True

False
Emerging markets have become important for marketing a
wide variety of products and services. Give examples to
support this argument.

To create paragraphs in your essay response, type <p> at the beginning of the paragraph, and
</p> at the end.

Explain how PPP is utilized to accurately estimate market

potential in emerging markets.
To create paragraphs in your essay response, type <p> at the beginning of the paragraph, and
</p> at the end.
Managers can utilize the Emerging Market Potential Index
(EMPI) in several ways to determine what countries make a
good market. Name these ways.

To create paragraphs in your essay response, type <p> at the beginning of the paragraph, and
</p> at the end.

In the past, international firms assumed that there were few

profitable opportunities in developing economies. Today,
however, that has changed. Give examples of how doing
business in developing economies can be profitable.

To create paragraphs in your essay response, type <p> at the beginning of the paragraph, and
</p> at the end.
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