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Chapter 1 Multiple choice questions
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Chapter 1 Multiple choice questions
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Governance within a global factory system refers to:
long term strategic thinking within an organization.
correct
incorrect
the level of social accountability of an organization.
correct
incorrect
how value-adding activities are organised, monitored and controlled.
correct
incorrect
the pursuit of sound management practices in making and implementing decisions.
correct
incorrect
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Fine-slicing within global factory systems is possible because:
the large size of global factory systems enables senior management to more easily organize complex transactions.
correct
incorrect
technological, communication and control technologies enable the fragmentation of value adding.
correct
incorrect
government policies actively encourage the offshoring of tasks.
correct
incorrect
geographical separation of activities offers tax advantages to the lead firm.
correct
incorrect
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Foreign value added is best described as:
the value added by an industry in a production chain.
correct
incorrect
a country's gross output minus intermediate consumption.
correct
incorrect
the ratio between an index of export prices and an index of import prices.
correct
incorrect
the share of imported inputs in a production chain.
correct
incorrect
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A value chain is most accurately described as:
interrelated value-adding activities that convert inputs into outputs.
correct
incorrect
supporting activities that contribute to a company's international market position.
correct
incorrect
the life cycle of processes used in the production of a good or service.
correct
incorrect
profitable production activities that minimize overall costs of production.
correct
incorrect
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For a lead firm a key benefit of adopting a non-equity mode of operation is that it enables:
entry into a market that lacks potential acquisition target firms.
correct
incorrect
a firm to reduce risk and levels of investment when operating internationally.
correct
incorrect
foreign supplies to better access leading edge technology.
correct
incorrect
a reduced need to monitor production and quality control practices.
correct
incorrect
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Within a global factory system a lead firm is most usefully understood:
in terms of ownership and legal status.
correct
incorrect
as part of a complex network.
correct
incorrect
as a key source of technology.
correct
incorrect
as a planning and coordinating entity.
correct
incorrect
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The distinction between producer-driven and buyer-driven value chains is useful because:
they differ in terms of who exercises the most significant influence within the chain.
correct
incorrect
coordination is simpler in producer driven chains.
correct
incorrect
buyer chains increase the power of suppliers.
correct
incorrect
consumers are able to dominate buyer value chains.
correct
incorrect
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Reverse innovation describes:
innovations that originate at the marketing end of the value chain.
correct
incorrect
innovations produced in-house or by partner organizations often in emerging markets.
correct
incorrect
innovations that cannibalize existing products or services.
correct
incorrect
innovations that have more value in emerging markets.
correct
incorrect
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Consumerism is an important part of the global factory model because:
it encourages demand through the continuing acquisition of goods and services.
correct
incorrect
it recognizes 'consumer sovereignty' within a market economy.
correct
incorrect
it acknowledges the freedom of consumers to choose between competing providers.
correct
incorrect
it provides a basis for product differentiation by global factory firms.
correct
incorrect
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Compared with what we have termed a 'traditional' MNE, a global factory system is likely to:
be much larger and organizationally complex.
correct
incorrect
operate in more overseas markets.
correct
incorrect
externalize a larger proportion of non-core activities.
correct
incorrect
operate across a number of industry boundaries.
correct
incorrect
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