Question

1. Which of the following exemplifies location-based advantage for the companies competing on an international basis?

A. Hyundai signs a memorandum of understanding with the government of South Korea to halt exports.
B. Samsung diversifies and ventures into textiles and food processing.
C. RBC Wealth Management closes operations in South Florida.
D. Microsemi Corporation acquires California-based Actel Corporation.
E. De Beers sets up operations in the mining region of South Africa.

2. Which of the following statements regarding multidomestic competition is false?

A. Winning in one country market does not necessarily signal the ability to fare well in other countries.
B. The benefits from global integration and standardization are high.

C. Buyers in different countries are attracted to different product attributes.
D. Industry conditions and competitive forces in each national market differ in important respects.
E. The mix of competitors in each country market varies from country to country.

3. Companies operating in an international marketplace have to respond to all of the following, EXCEPT

A. Whether to buy a struggling competitor at a bargain price or pay a premium to gain entry to the local market.
B. The tensions between market pressures to localize a company's product offerings country by country and the competitive pressures to lower costs through greater product customization.
C. How much to customize their offerings in each different country market to match the tastes and preferences of local buyers.
D. whether to customize their offerings in each different country market to match the tastes and preferences of local buyers.

E. Whether to pursue a strategy of offering a mostly standardized product worldwide

Answer 1

1) E

The De Beers is involved in diamond exploration and mining and has projects in open pit, deep sea mining etc. Thus, setting up operations in mining area of South Africa will be advantageous

2) B

The multi-domestic is a strategy in which company opts for different strategy in different regions basis the prevailing market conditions. It is thus against the concept of global integration and standardization. Also, the success of a company depends on strategy best suited for local demand and varies with country

3) A

The issue of buying a competitor at bargain price or paying premium to gain entry is an issue of acquisition minded firm but in order to compete in international market, the company needs to look for whether to customize offering as per local need, if yes then how much to customize and if not then go for standard product

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