Professional Documents
Culture Documents
Test Item Table by Major Section of the Chapter and Bloom’s Level of Learning
Marketing in 75, 76, 82, 83, 84, 91, 92, 94, 71, 72, 73, 74, 77, 78, 80, 81, 85, 79, 88, 89, 90,
a Borderless 97, 98, 99, 105, 106, 107, 86, 87, 94, 95, 96, 100, 101, 102, 93, 122, 131,
Economic World 116, 117, 118, 119, 120, 123, 103, 104, 108, 109, 110, 111, 133, 137
124, 125, 129, 132, 134, 135, 112, 113, 114, 115, 121, 126, 319, 321
(pp. 164-171) 136, 138, 139, 140, 142, 143, 127, 128, 130, 141, 144, 145,
147, 148 146, 149, 150, 151, 152, 153
325 320, 322, 323, 324
A Global 154, 155, 156, 157, 163, 164, 158, 165, 169, 173, 174, 175, 159, 160, 161,
Environmental Scan 167, 168, 170, 171, 172, 176, 179, 193, 194, 195, 196, 197, 162, 166, 178,
177, 181, 186, 187, 188, 198, 202, 205, 206, 208, 209, 210, 180, 182, 183,
(pp. 171-179) 199, 200, 201, 203, 204, 212, 214, 215, 218, 219, 220, 223, 184, 185, 189,
213, 216, 217, 222, 224 225, 226, 227 190, 191, 192,
329 326, 327, 328, 330, 331 207, 211, 221
Comparing Global 228, 229, 230, 231, 232, 240, 233, 234, 235, 236, 237, 238, 247, 248, 255,
Market-Entry 241, 242, 243, 244, 245, 246, 239, 250, 254, 258, 259, 260, 263, 267, 270,
Strategies 249, 251, 252, 253, 256, 257, 261, 262, 274, 275, 279 280
264, 265, 266, 268, 269, 271, 332, 333, 334, 335
(pp. 179-183) 272, 273, 276, 277, 278
Crafting a 281, 285, 286, 289, 305, 306, 282, 287, 291, 292, 293, 294, 283, 284, 288,
Worldwide 307, 309, 310, 311 295, 296, 297, 298, 299, 300, 290, 308, 312
Marketing Program 301, 302, 303, 304
(pp. 183-186) 336, 337, 338
NOTE: Bold numbers indicate short essay questions. Underlined numbers indicate visually enhanced questions.
CHAPTER 7: MASTER TEST BANK
UNDERSTANDING AND REACHING GLOBAL CONSUMERS AND MARKETS
LO2 Identify the 154, 155, 156, 157, 163, 158, 165, 169, 173, 174, 175, 159, 160, 161, 162,
environmental 164, 167, 168, 170, 171, 179, 193, 194, 195, 196, 197, 166, 178, 180, 182,
forces that shape 172, 176, 177, 181, 186, 202, 205, 206, 208, 209, 210, 183, 184, 185, 189,
187, 188, 198, 199, 200, 214, 215, 218, 219, 220, 223, 190, 191, 192, 207,
global marketing
201, 203, 204, 212, 213, 225, 226, 227 211, 221
efforts. 216, 217, 222, 224 326, 327, 328, 330, 331
(pp. 171-179) 329
LO3 Name and 228, 229, 230, 231, 232, 1, 2, 3, 4, 233, 234, 235, 236, 247, 248, 255, 263,
describe the 240, 241, 242, 243, 244, 237, 238, 239, 250, 254, 258, 267, 270, 280
alternative 245, 246, 249, 251, 252, 259, 260, 261, 262, 274, 275,
253, 256, 257, 264, 265, 279
approaches
266, 268, 269, 271, 272, 332, 333, 334, 335
companies use to 273, 276, 277, 278
enter global
markets.
(pp. 179-183)
LO4 Explain the 281, 285, 286, 289, 305, 282, 287, 291, 292, 293, 294, 283, 284, 288, 290,
distinction 306, 307, 309, 310, 311, 295, 296, 297, 298, 299, 300, 308, 312
between 313 301, 302, 303, 304, 314, 315,
316
standardization
and 336, 337, 338
customization
when companies
craft worldwide
marketing
programs.
(pp. 183-186)
NOTE: Bold numbers indicate short essay questions. Underlined numbers indicate visually enhanced questions.
CHAPTER 7: MASTER TEST BANK
UNDERSTANDING AND REACHING GLOBAL CONSUMERS AND MARKETS
In what way is Dell’s expansion into the global arena a departure from its prior marketing
practices?
a. All Dell products were manufactured in the countries within which they were sold.
b. Dell sold its products to emerging markets using the telephone and Internet sales strategy that
was so successful in the United States.
c. Dell opened stores in selected retailers in India.
d. Dell sold only laptops in China whereas it sold both desktops and laptops in India due to trade
restrictions in China.
e. Dell designed and distributed the same products globally to take advantage of economies of
scale.
Answer: c Page(s): 159 LO: 3 AACSB: Global QD: Medium
Rationale: Dell’s global initiative is bold in its departure from prior product development
practices and change to its sales and distribution strategy. It is designing and initially launching
products to meet the specific needs of emerging country customers. Moreover, Dell opened
stores in selected retailers in India, among other initiatives that were different from its U.S.
strategy.
Dell established its company primarily with direct telephone-and Internet-based sales. In terms of
Dell’s global expansion strategy, which of the following statements is most accurate?
a. Dell will sell its computers in “traveling” stores, consisting of custom-made trailers with solar
energy panels that will allow them to reach remote marketplaces.
b. Dell will partner with each country’s largest department stores and sell its computers in the
small appliance department.
c. Dell will issue its own credit card through multinational banks, making it possible for
customers who would not normally qualify for credit to do so.
-3-
d. Dell will distribute its products through electronics retailers to reach more buyers quickly.
e. Dell will maintain the exact same strategies that brought it this far because it sees no reason
to “mess with success.”
Dell established its company primarily with direct telephone-and Internet-based sales. In terms of
Dell’s global expansion strategy, which of the following statements is most accurate?
a. Dell will continue to use its direct buy strategy but will require all new employees in its sales
force to be multilingual.
b. Dell will open “shop-in-a-shop” counters in selected retailers in India where customers can
reduce purchase anxiety by using the computers before they buy.
c. Dell will establish call centers in all major international cities so that customers may deal
directly with native-born speakers.
d. Dell will issue its own credit card through microfinance-oriented banks, making it possible
for customers who would not normally qualify for credit to do so.
e. Dell will maintain the exact same strategies that brought it this far because it sees no reason
to “mess with success.”
Which of the following statements about the dynamics of world trade is most accurate?
a. Manufactured goods and commodities account for only 10 percent of world trade.
b. Three-fourths of world trade includes services such as telecommunications, transportation,
and banking.
c. World trade will likely exceed $25 trillion by 2015.
d. All nations participate equally in world trade.
e. There is still greater growth potential in developed countries than emerging ones.
Which of the following statements about the dynamics of world trade is most accurate?
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a. As the largest international marketer, the United States accounts for 85 percent of world
trade.
b. World trade refers exclusively to the exchange of money for goods or services.
c. An estimated 35 percent of world trade involves countertrade.
d. European intratrade is smaller but more powerful than for any of the other world regions.
e. The United States, Western Europe, Canada, China, and Japan together account for more than
two-thirds of world trade in manufactured goods and commodities.
-5-
Figure 7-1
According to Figure 7-1 above, which of the following countries is the world’s leading exporter?
a. United States
b. France
c. China
d. Germany
e. Japan
According to Figure 7-1 above, which of the following countries is the world’s leading importer?
a. France
b. Germany
c. Japan
d. United States
e. China
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Rationale: The United States, China, Japan, Western Europe, and Canada together account for
more than two-thirds of world trade in manufactured goods and commodities. In Figure 7-1, the
data for exports (in billions of U.S. dollars) is shown on the X-axis whereas the data for imports
(in billions of U.S. dollars) is shown on the Y-axis. Each country’s exports and imports is
depicted as a circle; the larger the circle, the greater the size of its exports and imports. Since the
circle that represents the United States is the highest on the Y-axis, it is the largest importer.
Drawing a horizontal line through the center of this circle, one can estimate that U.S. imports
total approximately $1,580 billion or $1.6 trillion. Next, below the United States is China, and
then Germany. See Figure 7-1 in the textbook.
Which global perspective on world trade views exports and imports as complementary economic
flows?
a. the balance of trade
b. quotas
c. the trade feedback effect
d. the competitive advantage of nations
e. tariffs
Which of the following statements accurately describes the global perspective on world trade?
-7-
a. Exports are of significantly greater importance than imports.
b. Imports are of significantly greater importance than exports.
c. Imports and exports should be complementary economic flows: a country’s imports affect its
exports and exports affect its imports.
d. Exports and imports should always be kept in a state of equilibrium.
e. Imports and exports should be controlled through extensive use of international tariffs,
quotas, and other trade regulations.
Countertrade refers to
a. the illegal agreement of one country to buy products exclusively from another.
b. the legal agreement of one country to buy products exclusively with another.
c. the practice of using barter rather than money for making global sales.
d. the sale of industrial goods from a brick and mortar outlet rather than directly from the
manufacturer.
e. the use of legal tender in making global sales.
The practice of using barter rather than money for making global sales is referred to as
a. trade balancing.
b. tariffs.
c. the trade feedback effect.
d. countertrade.
e. currency forbearance.
-8-
Rationale: An estimated 15 to 20 percent of world trade involves countertrade, which is the
practice of using barter rather than money for making global sales.
Volvo of North America delivered automobiles to the Siberian police force when Siberia had no
cash to pay for them. It accepted payment in oil, which it then sold for cash to pay for media
advertising in the United States. This is an example of
a. a quota.
b. countertrade.
c. balance of trade.
d. competitive advantage.
e. a trade feedback effect.
The Malaysian government recently exchanged 20,000 tons of rice for an equivalent amount of
Philippine corn. This is an example of (a)
a. competitive advantage.
b. countertrade.
c. balance of trade.
d. quota.
e. trade feedback.
The Tahitian pearl market might never have existed were it not for Salvador Assael, the “pearl
king” of the South Seas. Assael got into the pearl business at the end of World War II. Tahiti
had thousands of Swiss watches but suddenly had no GIs to buy them. Assael observed that the
Japanese were desperate for watches but had no cash, and also, that the Japanese still had a pearl
industry. So, Assael oversaw the swapping of watches for pearls, which were then sold to the
Australian and U.S. markets. This international barter is an example of
a. a reciprocity agreement.
b. balance of trade.
c. cross-cultural commerce.
d. countertrade.
e. a trade feedback effect.
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7-20 COUNTERTRADE APPLICATION
Recipco and Tradaq are both companies that connect international companies who want to barter
the products they make for the products they need without using cash or credit. Recipco and
Tradaq assist international companies in making
a. countertrades.
b. quota exchanges.
c. trading exchanges.
d. balances of trade.
e. WTO trade arrangements.
The monetary value of all goods and services produced in a country during one year is referred to
as the
a. gross national production.
b. national monetary reserve.
c. gross domestic product.
d. monetary domestic product.
e. annual national product.
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c. the comparison of total exports from one country to another.
d. the difference between projected sales and actual sales for a nation’s exports.
e. the state of equilibrium when two neighboring nations participate in countertrade.
The difference between the monetary value of a nation’s exports and imports is called its
a. countertrade.
b. trade feedback effect.
c. balance of trade.
d. gross domestic product.
e. tariffs.
Which of the following statements best describes the relationship between the imports into the
United States and the exports from the United States during the last 30 years?
a. No accurate data has been made available from the WTO on trade imports and exports.
b. The volume of both imports and exports has consistently decreased.
c. Imports into the United States and exports have been about equal, indicating balanced trade.
d. Exports have exceeded imports, indicating a continuing trade surplus.
e. Imports have exceeded exports, indicating a continuing trade deficit.
Which of the following statements about world trade flows is most accurate?
a. The United States is tied with China and Japan as the world’s leaders in exports.
b. The U.S. percentage share of world exports has shifted upwards over the past 30 years.
c. The United States has maintained a steady percentage share of world imports.
d. The relative position of the United States as a supplier to the world has diminished despite an
absolute growth in exports.
e. The United States’ relative role as an exporter has decreased in areas of aerospace, chemical,
pharmaceutical, and information technology industries within the past five years.
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Rationale: The United States is among the world’s leaders in exports. However, the U.S.
percentage of world exports has shifted downward over the past 30 years, whereas its percentage
share of world imports has increased. The relative position of the United States as a supplier to
the world has diminished despite an absolute growth in exports. At the same time, its relative
role as a marketplace for the world has increased. See Figure 7-1 in the textbook.
Which of the following statements about world trade flows is most accurate?
a. The United States is tied with China and Japan as the world’s leaders in exports.
b. The U.S. percentage share of world exports has shifted downwards over the past 30 years.
c. The United States has maintained a steady percentage share of world imports.
d. The United States’ relative role as an exporter has decreased in the area of aerospace during
the past five years.
e. The relative position of the United States as a supplier to the world has increased because of
an absolute growth in exports.
Which of the following statements about world trade flows is most accurate?
a. China is the world leader in terms of GDP (gross domestic product).
b. The relative position of the United States as a supplier to the world has increased because of
an absolute growth in exports.
c. The relative position of the United States as a supplier to the world has diminished despite an
absolute growth in exports.
d. The United States’ relative role as an exporter has decreased in the area of aerospace during
the past five years.
e. It is impossible to compare GDPs of different nations since it is an internal measurement of
economic activity.
Which of the following statements about world trade flows is most accurate?
a. The United States is the world leader in terms of GDP (gross domestic product).
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b. The relative position of the United States as a supplier to the world has increased because of
an absolute growth in exports.
c. The United States is running a continuing trade surplus because it has the world’s largest
gross domestic product.
d. The United States’ relative role as an exporter has decreased in the area of aerospace during
the past five years.
e. During the past 30 years, the relative position of the United States in terms of GDP has
remained stable despite the fact that actual value of products and services has increased.
Which of the following statements about world trade flows is most accurate?
a. The EU (European Union) is the world leader in terms of GDP (gross domestic product).
b. The relative position of the United States as a supplier to the world has increased because of
an absolute growth in exports.
c. The United States is running a continuing trade surplus because it has the world’s largest
gross domestic product.
d. The United States’ relative role as an exporter remains strong in the area of aerospace.
e. During the past 30 years, the relative position of the United States in terms of GDP has
remained stable despite the fact that actual value of products and services has increased.
Which of the following statements about world trade flows is most accurate?
a. The EU (European Union) is the world leader in terms of GDP (gross domestic product).
b. The relative position of the United States as a supplier to the world has increased despite an
absolute growth in exports.
c. The United States’ role as a marketplace for the world has increased, especially for
automobiles, oil, textiles, and consumer electronics.
d. The United States’ relative role as an exporter has decreased in the area of aerospace during
the past five years.
e. The United States’ relative role as an exporter changed dramatically when it became a
service-oriented economy.
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Rationale: The United States is among the world’s leaders in exports. However, the U.S.
percentage of world exports has shifted downward over the past 30 years, whereas its percentage
share of world imports has increased. The relative position of the United States as a supplier to
the world has diminished despite an absolute growth in exports. At the same time, its relative
role as a marketplace for the world has increased. See Figure 7-1 in the textbook.
Which of the following statements best describes what has happened to U.S. exports versus
imports over the last 30 years?
a. No accurate data have been made available from the WTO for trade imports and exports.
b. The volume of imports and exports has consistently decreased.
c. U.S. imports and U.S. exports have been about equal, indicating balanced trade.
d. U.S. exports have exceeded U.S. imports, indicating a continuing trade surplus.
e. The volume of both U.S. exports and U.S. imports has increased significantly.
Changes in the products Americans buy and sell, additional jobs, and an improved standard of
living are all effects of
a. an increase in imports and an increase of exports.
b. an increase in imports and a decrease in exports.
c. a decrease in imports and a decrease in exports.
d. a state of equilibrium between imports and exports.
e. the reversal of importance between the services sector and the manufacturing sector.
World trade flows to and from the United States reflect __________ for goods and services
among nations and industries.
a. demand and supply interdependencies
b. disparities between supply and demand
c. positive and negative synergistic trade
d. a negative currency exchange
e. an ethnocentric bias
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7-35 WORLD TRADE FLOWS COMPREHENSION
China, Japan, and South Korea combine for about _________ percent of the total U.S. balance of
trade deficit.
a. 30
b. 50
c. 65
d. 80
e. 95
Michael Porter has identified four key elements to explain why some companies and industries
succeed globally while others fail. These four elements are collectively referred as
a. the balance of trade wheel.
b. the points of difference effect.
c. the trade feedback effect.
d. the international trade pyramid.
e. the diamond of national competitive advantage.
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Answer: e Page(s): 161-162 LO: 1 AACSB: Global QD: Medium
Rationale: To explain a nation’s competitive advantage, Michael Porter suggests a “diamond” of
four elements: (1) factor conditions; (2) demand conditions; (3) related and supporting industries;
and (4) company strategy, structure, and rivalry. See Figure 7-2 in the textbook.
Michael Porter has identified four key elements in a nation’s competitive advantage:
__________; demand conditions; related and supporting industries; and company strategy,
structure and rivalry.
a. industry composition
b. size of market
c. governmental regulation
d. suppliers
e. factor conditions
Michael Porter has identified four key elements in a nation’s competitive advantage: factor
conditions; __________; related and supporting industries; and company strategy, structure, and
rivalry.
a. demand conditions
b. ethnocentrism
c. barriers to entry
d. governmental regulation
e. suppliers
Michael Porter has identified four key elements in a nation’s competitive advantage: factor
conditions; demand conditions; __________; and company strategy, structure, and rivalry.
a. consumer behavior
b. workforce education and skill levels
c. related and supporting industries
d. governmental regulation
e. ethnocentrism
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Rationale: To explain a nation’s competitive advantage, Michael Porter suggests a “diamond” of
four elements: (1) factor conditions; (2) demand conditions; (3) related and supporting industries;
and (4) company strategy, structure, and rivalry. See Figure 7-2 in the textbook.
Michael Porter has identified four key elements in a nation’s competitive advantage: factor
conditions; demand conditions; related and supporting industries; and __________.
a. consumer behavior
b. workforce education and skill levels
c. governmental regulation
d. company strategy, structure, and rivalry
e. suppliers
Figure 7-2
According to Michael Porter’s diamond in Figure 7-2 above, quadrant “A” represents
a. factor conditions.
b. related and supporting industries.
c. demand conditions.
d. managerial conditions.
e. company strategy, structure, and rivalry.
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Rationale: To explain a nation’s competitive advantage, Michael Porter suggests a “diamond” of
four elements: (1) factor conditions; (2) demand conditions; (3) related and supporting industries;
and (4) company strategy, structure, and rivalry. Factor conditions reflect a nation’s ability to
turn its natural resources, education, and infrastructure into a competitive advantage. See Figure
7-2 in the textbook.
According to Michael Porter’s diamond in Figure 7-2 above, quadrant “B” represents
a. factor conditions.
b. related and supporting industries.
c. demand conditions.
d. managerial conditions.
e. company strategy, structure, and rivalry.
According to Michael Porter’s diamond in Figure 7-2 above, quadrant “C” represents
a. factor conditions.
b. related and supporting industries.
c. demand conditions.
d. managerial conditions.
e. company strategy, structure, and rivalry.
According to Michael Porter’s diamond in Figure 7-2 above, quadrant “D” represents
a. factor conditions.
b. related and supporting industries.
c. demand conditions.
d. managerial conditions.
e. company strategy, structure, and rivalry.
- 18 -
Rationale: To explain a nation’s competitive advantage, Michael Porter suggests a “diamond” of
four elements: (1) factor conditions; (2) demand conditions; (3) related and supporting industries;
and (4) company strategy, structure, and rivalry. Related and supporting industries include the
existence of supplier clusters that accelerate innovation and improve quality. See Figure 7-2 in
the textbook.
The Dutch lead the world in the cut-flower industry because of their research in flower
cultivation, packaging, and shipping. Using this knowledge as a resource is an example of what
Michael Porter would term
a. structural conditions.
b. demand conditions.
c. sociocultural conditions.
d. competitive conditions.
e. factor conditions.
Each day, in a third-class carriage of the express train that runs between Bombay and
Ahmadabad, plainly dressed couriers carry precious cargo: diamonds. Rough gems are imported
to Bombay from dealers in London, Antwerp, Tel Aviv, and New York. Couriers then take these
gems to cutting and polishing centers in Gujarat state and then carry them back to Bombay to be
reexported to the world. This system, based on trust, secrecy, and skilled low-cost labor, has
worked for half a century. It has helped make India the world’s premier center for diamond
cutting and polishing. Nine out of every 10 stones sold in the world pass through India, making
diamonds that country’s largest export. India’s ability to use its skilled labor as a resource is an
example of what Michael Porter would term
a. structural conditions.
b. demand conditions.
c. factor conditions.
d. competitive conditions.
e. sociocultural conditions.
According to Michael Porter’s diamond of national competitive advantage, both the number and
sophistication of domestic customers for an industry’s product are examples of
a. structural conditions.
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b. demand conditions.
c. sociocultural conditions.
d. competitive conditions.
e. factor conditions.
Austria has been described as “the very heartland of European coffee culture.” These “coffee-
knowledgeable” Austrians drink 21.5 liters of coffee per person annually. Starbucks wanted to
open coffee houses in Austria and sell Starbucks coffee there. For Starbucks, the Austrian level
of coffee-drinking sophistication would be an example of
a. structural conditions.
b. demand conditions.
c. sociocultural conditions.
d. competitive conditions.
e. factor conditions.
To become leaders in the world market, countries need related and supporting industries because
a. collaborative suppliers can generate revenue for further investment.
b. they can eliminate the need to import materials from other countries.
c. clusters of strong suppliers can accelerate innovation.
d. most countries still believe strongly in protectionism.
e. their union lessens financial vulnerability and increases buying power.
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Rationale: Related and supporting industries include the existence of supplier clusters that
accelerate innovation and improve quality. See Figure 7-2 in the textbook.
Nine out of every 10 diamonds sold in the world pass through India, making diamonds that
country’s largest export at $6.6 billion a year. One of the reasons for its success is the nation’s
2,500 trading firms, banks, airlines, customers’ offices, and courier services that make sure the
diamonds are safely delivered. According to Michael Porter’s theory about national competitive
advantage, India’s success in the diamond industry is due in part to its
a. company strategy, structure, and rivalry.
b. absence of competition.
c. related and supporting industries.
d. factor conditions.
e. demand conditions.
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7-56 COMPANY STRATEGY, STRUCTURE, AND RIVALRY COMPREHENSION
The Italian shoe industry has become a world leader because of intense domestic competition
among firms such as Bruno Magli and Rossimoda. According to Michael Porter’s theory about
national competitive advantage, Italy’s success in the shoe industry is due in part to its
a. company strategy, structure, and rivalry.
b. absence of competition.
c. related and supporting industries.
d. factor conditions.
e. demand conditions.
Which of the following statements reflects Michael Porter’s theory regarding national
competitive advantage?
a. Clusters of strong suppliers can interfere with entry into a global market.
b. A firm that succeeds in global markets often has first succeeded in its domestic market.
c. A country’s natural resources, education, and infrastructure often pose obstacles that cannot
be overcome.
d. The first goal of a global marketer is to actively educate a nation’s domestic customers.
e. A nation’s domestic workforce is more motivated to work for foreign corporations than its
own.
Although there are many factors contributing to the success of major global marketers, a common
theme seems to be that they
a. first became involved with a formalized trade organization, such as the WTO.
b. specialized in services rather than consumer goods.
c. employed a multicultural or multinational staff.
d. first succeeded in intense domestic competition.
e. were the largest companies in their industry.
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7-59 COMPETITIVE ADVANTAGE OF NATIONS COMPREHENSION
Which of the following statements reflects Michael Porter’s theory regarding national
competitive advantage?
a. Clusters of strong suppliers can interfere with entry into a global market.
b. A firm that succeeds in global markets has often left a domestic market because it was too
competitive.
c. A country’s natural resources, education, and infrastructure can be turned into a competitive
advantage.
d. The first goal of a global marketer is to actively educate a nation’s domestic customers.
e. A nation’s domestic workforce is more motivated to work for foreign corporations than its
own.
Which of the following statements reflects Michael Porter’s theory regarding national
competitive advantage?
a. Clusters of strong suppliers can accelerate innovation.
b. A firm that succeeds in global markets has often left a domestic market because it was too
competitive.
c. A country’s natural resources, education, and infrastructure can represent obstacles that are
often difficult to overcome.
d. The first goal of a global marketer is to actively educate a nation’s domestic customers.
e. A nation’s domestic workforce is more motivated to work for foreign corporations than its
own.
Which of the following statements reflects Michael Porter’s theory regarding national
competitive advantage?
a. Clusters of strong suppliers can interfere with entry into a global market.
b. A firm that succeeds in global markets has often left a domestic market because it was too
competitive.
c. A country’s natural resources, education, and infrastructure can represent obstacles that are
often difficult to overcome.
d. Conditions such as the number and sophistication of domestic customers can affect demand
for an industry’s product.
e. A nation’s domestic workforce is more motivated to work for foreign corporations than its
own.
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Rationale: Demand conditions include both the number and sophistication of domestic customers
for an industry’s product. See Figure 7-2 in the textbook.
Competitive advantage for global firms grows out of __________, innovation, and change.
a. product quality
b. continuous improvement
c. employment of a multicultural or multinational staff
d. membership in a formalized trade organization
e. market research
Competitive advantage for global firms grows out of continuous improvement, __________, and
change.
a. product quality
b. employment of a multicultural or multinational staff
c. membership in a formalized trade organization
d. market research
e. innovation
Competitive advantage for global firms grows out of continuous improvement, innovation, and
__________.
a. accountability
b. change
c. product quality
d. company size
e. location
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7-65 ECONOMIC ESPIONAGE KNOWLEDGE
The estimated cost of economic espionage to firms in the United States is estimated to be
a. $10 billion per year.
b. $250 billion per year.
c. $750 billion per year.
d. $900 billion per year.
e. exceeding $1 trillion per year.
The prescribed penalty for individuals found guilty of the theft of trade secrets is
a. up to 15 years in prison and fines up to $500,000.
b. up to 25 years in prison and fines up to $10 million.
c. life in prison with chance of parole after 25 years.
d. expulsion from the United States and/or revocation of citizenship.
e. 30 years in prison and fines to be determined by the courts.
- 25 -
Rationale: The Economic Espionage Act (1996) makes the theft of trade secrets by foreign
entities a federal crime in the United States. This act prescribes prison sentences of up to 15
years and fines up to $500,000 for individuals. Agents of foreign governments found guilty of
economic espionage face a 25-year prison sentence and a $10 million fine.
The prescribed penalty for agents of foreign governments found guilty of economic espionage is
a. up to 15 years in prison and fines up to $500,000.
b. life in prison with chance of parole after 25 years.
c. 25 years in prison and a $10 million fine.
d. permanent expulsion from the United States.
e. 30 years in prison and fines proportional to the damage caused.
Four trends in the past decade have significantly influenced the landscape of global marketing.
One of them is:
a. an increase in most countries’ GDPs coupled with an increased degree of consumer
ethnocentrism.
b. a significant increase in economic protectionism and a decline in free trade.
c. a more aggressive attitude toward initiating international tariffs and quota systems.
d. a decrease in most countries’ GDPs and a renewal of nationalism.
e. a gradual decline in economic protectionism by individual countries.
- 26 -
formal economic integration and free trade among nations; (3) global competition among global
companies for global customers; and (4) the development of networked global marketspace.
Four trends in the past decade have significantly influenced the landscape of global marketing.
One of them is:
a. an increase in economic protectionism and a decline in free trade.
b. a more aggressive attitude towards initiating international tariffs and quota systems.
c. a decrease in most countries’ GDPs and a renewal of nationalism.
d. global competition among global companies for global customers.
e. an increase in most countries’ GDPs coupled with an increased degree of consumer
ethnocentrism.
Four trends in the past decade have significantly influenced the landscape of global marketing.
One of them is:
a. an increase in economic protectionism and a decline in free trade.
b. a more aggressive attitude towards initiating international tariffs and quota systems.
c. a decrease in most countries’ GDPs and a renewal of nationalism.
d. the formal economic integration and free trade among nations.
e. an increase in most countries’ GDPs coupled with an increased degree of consumer
ethnocentrism.
Four trends in the past decade have significantly influenced the landscape of global marketing.
One of them is:
a. an increase in economic protectionism and a decline free trade.
b. a more aggressive attitude towards initiating international tariffs and quota systems.
c. a decrease in most countries’ GDPs and a renewal of nationalism.
d. emergence of networked global marketspace.
e. an increase in most countries’ GDPs coupled with an increased degree of consumer
ethnocentrism.
- 27 -
Rationale: Global marketing has been and continues to be affected by a growing borderless
economic world. Four trends in the past decade have significantly influenced the landscape of
global marketing: gradual decline of economic protectionism by individual countries, formal
economic integration and free trade among nations, global competition among global companies
for global customers, and development of networked global marketspace.
The practice of shielding one or more sectors of a country’s economy from foreign competition
through the use of tariffs or quotas is referred to as
a. domestic imperialism.
b. protectionism.
c. blocked competition.
d. import taxation.
e. trade restrictions.
Protectionism refers to
a. the practice of purchasing products exclusively from a domestic market in order to shore up a
nation’s economy.
b. the use of tariffs, quotas, and boycotts with the express intention of putting foreign
competitors out of business.
c. the practice of shielding one or more sectors of a country’s economy from foreign
competition through the use of tariffs or quotas.
d. a form of domestic imperialism that holds that only those products manufactured within one’s
home nation are of sufficient quality to warrant purchase.
e. the practice of purchasing products exclusively from a foreign developing country in order to
develop its industries and economic infrastructure.
- 28 -
discourages economic dependency on other countries, and encourages the development of
domestic industries.
Beginning January 1, 2005, China lifted the import quotas and lowered tariffs on automobiles.
This removal of the quotas and the lowering of tariffs is an example of
a. relaxing the rule of eminent domain.
b. reducing ethnocentrism.
c. enhancing domestic imperialism.
d. reducing protectionism.
e. enhancing countertrade.
- 29 -
Figure 7-3
The box with the “?” in Figure 7-3 above leads to which of the following as a result of the
imposition of tariffs and quotas based on protectionist policies of a country?
a. an increase in world trade
b. a decrease in world trade
c. a limit on exports
d. a limit on imports
e. countertrade
Which of the following issues raises concerns about the ethics of protectionism?
a. Competitive advantage grows out of continuous improvement.
b. Small firms succeed in foreign niche markets.
c. Tariffs have declined from an average of 40 percent to less than 5 percent.
d. Regional trade agreements provide preferential treatment for member nations.
e. Pan-European marketing strategies are possible due to greater uniformity in packaging
standards.
Tariffs refer to
a. government payments to companies or industries that primarily serve to create competitive
advantage for domestic products.
b. government taxes on goods or services entering a country that primarily serve to raise prices
on imports.
c. a restriction placed on the amount of a product allowed to enter or leave a country.
d. a minimum requirement for the purchase between two or more nations of products or
services.
e. a refusal to purchase or exchange goods or services with another nation unless certain
financial or ideological requirements have been satisfied.
The U.S. Rice Millers’ Association claims that if the Japanese rice market were opened to
imports by lowering __________, lower prices would save Japanese consumers $6 billion
annually and the United States would gain a large share of the Japanese rice market.
a. boycotts
b. tariffs
c. quotas
d. sanctions
- 31 -
e. subsidies
The __________ imposed on bananas by European Union countries cost consumers $2 billion a
year in higher prices.
a. boycotts
b. tariffs
c. quotas
d. sanctions
e. subsidies
U.S. citizens pay $5 billion more annually for shoes and Japanese citizens pay $6 billion more for
rice than the actual cost of the products because
a. both countries have suffered major financial crises due a severe trade imbalance.
b. both countries have imposed tariffs on imported goods to protect their domestic markets.
c. both countries have imposed limits on the quantity of these goods that can leave their
respective domestic markets.
d. both products are considered essentials and as a result are more heavily taxed.
e. these products were purchased at a lower price from nations that currently are under
governmental sanctions.
Recently, the Japanese government, under pressure from its domestic farm lobby, slapped
government taxes on mushrooms, leeks, and the reeds used in tatami mats that were being
imported from China. Japan levied
a. GATT taxes.
b. quotas.
c. tariffs.
d. excise taxes.
e. subsidies.
- 32 -
Rationale: Tariffs are government taxes on goods or services entering a country that primarily
serve to raise prices on imports.
If you wanted to set up a business importing amber from Latvia to the United States, you would
have to plan on paying the U.S. Customs Service roughly 20 percent of the value of the product
as a(n) __________.
a. bribe
b. tariff
c. subsidy
d. excise tax
e. quota
President Bill Clinton attempted to protect American firms from foreign competition by placing a
government tax on Japanese automobiles imported to the United States. President Clinton’s goal
was to raise the price on Japanese imports, thereby encouraging American consumers to purchase
American-made automobiles. The tax the president threatened to impose is an example of a
__________.
a. boycott
b. tariff
c. quota
d. sanction
e. subsidy
A restriction placed on the amount of a product allowed to enter or leave a country is referred to
as a
a. quota.
b. tariff.
c. GATT tax.
d. subsidy.
e. excise tax.
- 33 -
7-92 QUOTA KNOWLEDGE
A quota refers to
a. a government tax on goods or services entering a country that primarily serves to raise prices
on imports.
b. government payments to companies or industries that serve to lower costs and provide a
competitive advantage to domestic industries.
c. a restriction placed on the amount of a product allowed to enter or leave a country.
d. a minimum requirement for the purchase of specific products or services between two
nations.
e. a refusal to purchase or exchange goods or services with another nation unless certain
financial or ideological requirements have been satisfied.
The world’s largest manufacturer of peppermint candy canes was in Albany, Georgia, until it
could no longer afford to buy the sugar needed for its operation. It moved its manufacturing
business to Mexico where there are no restrictions (as existed in the United States) on the amount
of sugar that can be brought into the nation. The movement of this U.S. business to Mexico was
caused by a(n) __________ established by the U.S. government.
a. tariff
b. trade imbalance
c. quota
d. excise tax
e. subsidy
The __________ is an international treaty intended to limit trade barriers and promote world trade
through the reduction of tariffs.
a. North Atlantic Treaty Organization (NATO)
b. General Agreement on Tariffs and Trade (GATT)
c. North American Free Trade Agreement (NAFTA)
d. World Trade Association Treaty (WTAT)
e. United Nations Agreement on Trade (UNAT)
- 34 -
Every country engages in some form of protectionism. However, protectionism has declined
internationally over the past 50 years due in large part to the
a. United Nations Agreement on Trade (UNAT).
b. North American Free Trade Agreement (NAFTA).
c. General Agreement on Tariffs and Trade (GATT).
d. North Atlantic Treaty Organization (NATO).
e. World Trade Association Treaty (WTAT).
To a degree, every country engages in some form of protectionism. Over the past 50 years
however, this practice has diminished, in large part due to
a. an alignment of nations by ethnicity rather than geographical borders.
b. an increase in population and a decrease in resources.
c. the evolution of mass media.
d. the establishment of GATT.
e. an alignment of nations by political ideology rather than geographical borders.
A permanent institution that sets rules governing trade between its members through a panel of
trade experts who decide on trade disputes between members and issue binding decisions is
referred to as the __________.
a. League of Nations
b. World Trade Organization (WTO)
c. Association for Commerce Equity (ACE)
d. United Nations Board of Trade (UNBT)
e. Global Better Business Bureau (BBB-G)
- 35 -
c. a permanent institution that sets rules governing trade between its members through panels of
trade experts who decide on trade disputes between members and issue binding decisions.
d. a multinational trade organization composed of the world’s wealthiest nations whose primary
purpose is to aid in the economic growth of developing nations.
e. a multinational trade organization comprised of the world’s wealthiest nations whose primary
purpose is to promote free trade economies.
There are __________ World Trade Organization countries, including the United States, which
account for more than 90 percent of world trade.
a. 37
b. 52
c. 97
d. 113
e. 153
Which of the following statements about the World Trade Organization (WTO) is most accurate?
a. The WTO is a permanent institution that sets rules governing trade between its members.
b. The WTO sets rules governing trade between its members and the remainder of the world.
c. The 153 member countries of the WTO account for approximately 55 percent of world trade.
d. The WTO uses panels of trade experts who can issue non-binding recommendations.
e. The WTO was formed by the United Nations.
Which of the following statements about the World Trade Organization (WTO) is most accurate?
a. The World Trade organization is a temporary group that meets on an as needed basis.
b. The 153 member countries of the WTO account for approximately 55 percent of world trade.
c. The WTO sets rules governing trade between its members and the remainder of the world.
d. The WTO uses panels of trade experts who can issue binding decisions.
e. The WTO was formed by the United Nations.
- 36 -
Answer: d Page(s): 165-166 LO: 1 AACSB: Global QD: Medium
Rationale: The major industrialized nations of the world formed the WTO in 1995 to address
world trade issues. The 153 WTO member countries account for more than 90 percent of world
trade. The WTO is a permanent institution that sets rules governing trade between its members
through panels of trade experts who decide on trade disputes between members and issue binding
decisions.
Which of the following statements about the World Trade Organization (WTO) is most accurate?
a. The World Trade organization is a temporary institution.
b. The 153 member countries of the WTO account for more than 90 percent of world trade.
c. The WTO sets rules governing trade between its members and the remainder of the world.
d. The WTO uses panels of trade experts who can issue non-binding recommendations.
e. The WTO was formed by the United Nations.
Which of the following statements about the World Trade Organization (WTO) is most accurate?
a. The World Trade organization is a temporary institution.
b. The 153 member countries of the WTO account for less than 25 percent of world trade.
c. The WTO sets rules governing trade among its members.
d. The WTO uses panels of trade experts who can issue non-binding recommendations.
e. The WTO was formed by the United Nations.
Which of the following statements about the World Trade Organization (WTO) is most accurate?
a. The World Trade organization is a temporary institution.
b. The 153 member countries of the WTO account for less than 25 percent of world trade.
c. The WTO sets rules governing trade between its members and the rest of the world.
d. The WTO uses panels of trade experts who can issue non-binding recommendations.
e. The WTO was formed by the major industrialized nations of the world.
- 37 -
Answer: e Page(s): 165-166 LO: 1 AACSB: Global QD: Easy
Rationale: The major industrialized nations of the world formed the WTO in 1995 to address
world trade issues. The 153 WTO member countries account for more than 90 percent of world
trade. The WTO is a permanent institution that sets rules governing trade between its members
through panels of trade experts who decide on trade disputes between members and issue binding
decisions.
The European Union (EU) in mid-2012 consisted of 27 countries with more than 500 million
consumers. The EU has eliminated most barriers to the free flow of goods, services, capital, and
labor across its borders. Which of the following countries is NOT a member of the EU as of mid-
2012?
a. Latvia
b. Greece
c. Ireland
d. Switzerland
e. England
The European Union is an economic and political union of __________ member countries
located primarily in Europe that have eliminated most barriers to the free flow of goods, services,
capital, and labor across their borders.
a. 17
b. 20
c. 27
d. 30
e. 37
The European Union consists of 27 member countries. This single market houses more than
__________ million consumers with a combined GDP that is larger than that of the United States.
a. 100
b. 200
c. 300
d. 400
e. 500
- 38 -
Rationale: The European Union as of mid-2012 consisted of 27 countries with more than 500
million consumers with a combined GDP that is larger than that of the United States.
The European Union (EU) has created abundant marketing opportunities because it is no longer
necessary to
a. print material in multiple languages.
b. continually monitor currency exchange rates.
c. trade with the former Eastern European communist countries.
d. obey international trade regulations.
e. use the American dollar as an economic standard.
The EU has benefited its member nations because firms do not need to market their products and
services on a nation-by-nation basis, most tariffs that affect pricing practices have been removed,
and
a. there is a legally binding code of economic conduct.
b. there is immunity against world recessions.
c. there are fewer regulatory restrictions on transportation, advertising, and promotion.
d. there is a common language advantage among EU consumers.
e. most companies within the EU are engaging in strategic global partnerships.
- 39 -
restrictions on transportation, advertising, and promotion imposed by countries; and removal of
most tariffs that affect pricing practices.
The North American Free Trade Agreement was designed to encourage free trade between
a. North America, Central America, and South America.
b. the United States, Canada, and Mexico.
c. the United States and the European Union.
d. member countries originally from NATO (North Atlantic Treaty Organization).
e. North America and The Commonwealth of Independent States.
CAFTA-DR is a comprehensive free trade agreement between Costa Rica, the Dominican
Republic, El Salvador, Guatemala, Honduras, Nicaragua, and __________.
a. the United States
b. Panama
c. Belize
d. Cuba
e. Mexico
Which of the following is most accurate in regards to the Asian free trade agreements?
a. Efforts to liberalize trade in East Asia are growing.
b. Asian free trade agreements are more formal than those of the EU and NAFTA.
c. Asian free trade agreements are based on ethnicity rather than geographical borders.
d. Asian free trade agreements encourage the formation of multinational corporations.
e. Asian free trade agreements recently include India and China.
Which of the following is most accurate in regards to the Asian free trade agreements?
- 40 -
a. Efforts to liberalize trade in East Asia have decreased as a result of the economic downturn in
2009.
b. Asian free trade agreements are based on ethnicity rather than geographical borders.
c. Asian free trade agreements encourage the formation of multinational corporations.
d. Asian free trade agreements recently include India and China.
e. Asian free trade agreements have reduced tariffs among countries and promoted trade.
The “Little Dragons,” in relation to the Asian free trade agreements, are composed of:
a. Hong Kong, Singapore, South Korea, and Taiwan.
b. Hong Kong, Shanghai, Singapore, and Bangkok.
c. Beijing, Hong Kong, Shanghai, and Singapore.
d. Beijing, Tokyo, Taiwan, and Singapore.
e. Beijing, Hong Kong, Taiwan, and Bangkok.
When firms originate, produce, and market their products and services worldwide, it is referred to
as __________.
a. acculturation
b. global competition
c. free trade
d. global branding
e. transactional exchange
- 41 -
Rationale: Key term definition—global competition.
Pepsi-Cola, now available in more than 160 countries and territories, accounts for __________
percent of all soft drinks sold internationally.
a. 10
b. 15
c. 20
d. 25
e. 30
Agreements between two or more independent firms to cooperate for the purpose of achieving
common goals are referred to as
a. compacts.
b. global partnerships.
c. strategic alliances.
d. free trade agreements.
e. economic coalitions.
- 42 -
Collaborative relationships are becoming a common way to meet the demands of global
competition. Global __________ are agreements between two or more independent firms to
cooperate for the purpose of achieving common goals such as a competitive advantage or
customer value creation.
a. compacts
b. collaborative treaties
c. strategic alliances
d. free trade agreements
e. economic coalitions
Two carmakers have developed a strange but successful partnership. Ford, a U.S. automaker, and
Mazda, an Asian carmaker, have collaborated on several models, including the Explorer, the
Probe, the Mazda 323, and the Mazda MX-6. The U.S. automaker has supplied Mazda with help
in marketing, finance, and styling. In return, Mazda has provided manufacturing and product
development expertise to Ford. Both companies have worked together toward a common goal
and both have benefited as a result of their
a. international contract.
b. free trade agreement.
c. strategic alliance.
d. collaborative treaty.
e. global oligopoly.
In terms of the global marketplace, there are three primary types of companies: __________,
multinational firms, and transnational firms.
a. worldwide
b. conglomerate
c. intercontinental
d. international
e. cosmopolitan
- 43 -
In terms of the global marketplace, there are three primary types of companies: international
firms, __________ firms, and transnational firms.
a. large-scale
b. conglomerate
c. intercontinental
d. cosmopolitan
e. multinational
The administrative, marketing, and manufacturing operations that many international firms,
multinational firms, and transnational firms have around the world are often called
a. divisions.
b. outlets.
c. departments.
d. markets.
e. holding companies.
In terms of the global marketplace, there are three primary types of companies: (1) international
firms; (2) multinational firms; and (3) transnational firms. The key factor that distinguishes one
from another is
a. the firm’s financial capacity to take risks.
b. the willingness and ability to embrace diversity.
c. the firm’s orientation toward and strategy for global markets and marketing.
d. the relative position of the product or service in terms of its life cycle.
e. the relative size of the firm both in financial terms and in production capacity.
The three types of companies populate and compete in the global marketplace are (1)
international firms; (2) multinational firms; and (3) __________ firms.
a. multiethnic
b. transnational
c. multidomestic
d. ethnocentric
- 44 -
e. meganational
The three types of companies that populate and compete in the global marketplace are
international firms, __________ firms, and transnational firms.
a. multiethnic
b. domestic
c. multinational
d. ethnocentric
e. decentralized
A(n) __________ firm engages in trade and marketing in different countries as an extension of
the marketing strategy in its home country.
a. multidomestic
b. meganational
c. international
d. multinational
e. transnational
Generally speaking, a(n) __________ firm markets its existing products and services in other
countries the same way it does in its home country.
a. meganational
b. international
c. multinational
d. transnational
e. intranational
- 45 -
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Language: Finnish
1-näytöksinen ilveily
Kirj.
S. A. RUOTSALO
HUONE:
SELMA
SELMA
PERTTUNEN
Vaikeatapa tänne olikin osata, kun vastaantulijat lensivät kuin
hullut sen suuren varkaan perässä, josta juuri lauloit, eivätkä
joutaneet neuvomaan. (Istuu keinutuolissa.)
SELMA
PERTTUNEN
SELMA (on nostanut tuolin P:n viereen hellan suun eteen ja istuu
vastatessaan)
PERTTUNEN
PERTTUNEN (säikähtäen)
SELMA
AUKUSTA
Iltaa!
SELMA
AUKUSTA
Tapasin. Hän käski sanoa, ettei sinun tarvitse varata kahvia eikä
ruokaa. Soiniska syö saarnamiehineen siellä.
SELMA
Jokos seurat sitten loppuivat näin aikaisin?
AUKUSTA
SELMA
En arvaa.
AUKUSTA
SELMA
AUKUSTA
Niin, sitä suurta voroa. Ihmiset juoksevat pitkin kujia ja lääviä. Hän
on viime yönä kierrellyt kirkonkylällä ja ammuskellut nimismiehen
akkunoita. Aamulla hän kuuluu Punaisesta mökistä vaimonpuolen
puvussa tulleen tännepäin. (Kaivaa povestaan kuvan) Tässä on
hänen kuvansa, että tietäisit juosta pakoon, jos eteesi sattuu.
Leikkasin tämän Oulun lehdestä. Hän on sievä mies. Branderin
mamselli sanoikin: »Minä ottaisin tuon miehekseni, jos ei häntä
odottaisi ikuinen kakola».
Hiljaa. (Vetää Aukustan ovelle.) Minä luulen, että juuri tämä mies,
tämä Perttunen, istuu perikamarissa ja juo kahvia. Menkää ja
ilmoittakaa pyytäjille! Minä narraan hänet, koska hän on pettänyt
minut, narraan kellariin muka äitiä piiloon.
AUKUSTA
Vai on siellä joku. (Kovasti.) Ei, nyt minä juoksen kotiin. Hyvästi.
(Menee porstuaan, palaa takaisin.) Kuule! Kun tulet kaupunkiin, niin
soita sieltä uutisia.
SELMA
Ei sitä viitsi, kun se keskuksen akka kaikki kuuntelee ja kaikki
kertoo koko kylälle.
AUKUSTA
SELMA (yksin)
SOINISKA
ERVINKI
PERTTUNEN (kattelee)
SELMA
SELMA
SOINISKA
Mitä, mitä tämä melu on? Ja mistä tämä minun varastettu kelloni
on uunille ilmestynyt? (Kuuluu kolkutusta kellarista ja huutoja
ikkunan alta, Soiniska paitasillaan permannolla huutaa akkunasta.)
Mitä siellä elämöidään? Tulkaa sisälle!
SOINISKA
Mitä te sitten minun kellarissani tekisitte?
VAHTIMIES.
SOINISKA
SELMA
SOINISKA
ERVINKI
15
ERVINKI
SOINISKA
Unissasi!
ERVINKI
SOINISKA (Selmalle)
Entä sinä?
SELMA (lattialla jo)
SOINISKA
ERVINKI
SELMA
SOINISKA
ERVINKI
Ja Perttunen Noppa-Katilta.
SELMA
Varas varkaan varasti. Perttunen olikin ovelampi minua. Minä
menen katsomaan, saadaanko se kytketyksi. (Pois.)
SOINISKA
Updated editions will replace the previous one—the old editions will
be renamed.