Correct Answer: B

According to Kotler, "Global firms plan, operate, and coordinate their activities on a worldwide basis." Thus, a global firm secures cost or product differentiation advantages not available to domestic firms.

Correct Answer: D

The internationalization process is of crucial interest to nations that wish to encourage local firms to grow and to operate globally. According to Swedish researchers, it involves the following steps:

(1)

Lack of regular exports;

(2)

export via independent agents with a few markets, with later expansion to more countries;

(3)

creation of sales subsidiaries in larger markets; (4) establishment of plants in foreign countries.

Correct Answer: B

During the growth stage, the opportunity for cost reductions is at its maximum because production volume is increasing at a high rate. Thus, fixed costs are being spread over more units of production, and the benefits of the learning curve are being realized.

Correct Answer: B

A division is essentially a self-contained organization. Hence, it must perform all or most of the functions of the overall organization of which it is a part. It is characterized by substantial duplication of functions when compared with more centralized structures.

Correct Answer: C

The disadvantages of decentralization include a tendency to focus on short-run results to the detriment of the long-term health of the entity, an increased risk of loss of control by top management, the increased difficulty of coordinating interdependent units, and less cooperation and communication among competing decentralized unit managers.

Correct Answer: B

A distinctive ability to influence industry structure is another basis for earning above- average profits. Thus, an ability to raise mobility barriers after the firm has entered the industry is a reason to target that industry. Moreover, a firm may be able to recognize that entering a fragmented industry will start a process of consolidation and increased entry barriers.

Correct Answer: D

Perceptual errors can be minimized in several ways, including feedback from the receiver concerning his/her perceptions and interpretations of the message, understanding of the sender's perspective by the receiver, the sender's sensitivity to the receiver's problems, and implementation of a training program to improve communication skills throughout the company.

Correct Answer: A

The benefits of electronic communication include better control of information, more timely information, elimination of tedious tasks, improvement of competitiveness due to improved technology, standardization of procedures by computer programs, assistance for strategic planning, and optimization of organizational resources to improve productivity.

Correct Answer: A

Distributive bargaining occurs in zero-sum conditions; that is, what one side gains, the other loses. The parties are in fundamental opposition to each other, and their relationship tends to be short-term.

Correct Answer: A

In future negotiations, the "forced" opponent will be less likely to work with the negotiator to achieve mutual goals. Negotiations in which one or both parties feel they must "win" at the expense of the other party ultimately do not build a relationship of trust and cooperation.