International Business Test

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International Business Test - 16

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Weekly Quiz Competition

Question 1
1 / -0

In line with a franchising agreement, a franchisee may use ______.

A
geographic region exclusively

B
patents, designs, trade secrets and business know-how

C
trade marks, copyright and trade secrets

D
all of the above

Solution

"Franchising is a form of licensing in which a parent company (the franchisor) grants another independent entity (the franchisee) the right to do business in a prescribed manner. This right can take the form of selling the franchisers products, ‘using its name, production and marketing technique, or general business approach.” Donald W. Hacket

Thus it can be said that in a franchising agreement, franchisee uses patents, designs, its know-how, copyrights, trade marks so that it can sell the products of franchiser in the market by fulfilling proper legal requirements.
Question 2
1 / -0

Which of the following means the special rights given by a manufacturer or a parent organisation to another individual or firm to sell the former's product or service in a specified given area(s)?

A
Franchise

B
Network marketing

C
Indirect marketing

D
All of above

Solution

“Franchising is basically a specialised form of licensing in which the franchisor
not only sells intangible property (normally a trademark) to the franchisee, but
also insists that the franchisee agrees to abide by strict rules as to how it does
business.” Charles W.L. Hill
The term franchising applies to service business.
Question 3
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International trade in goods and services is sometimes used as a substitute for all of the following except ___________.

A
international movements of capital

B
domestic production of different goods and services

C
international movement of labour

D
international movement of technology

Solution

International trade refers to buying and selling of goods and services in different countries. It involves international movement of capital, labour as well as technology but does not include domestic production of different goods and services.
Question 4
1 / -0

Where a firm allows another firm in a foreign market to use its technical know-how and trade mark, it is known as _________.

A
franchising

B
network marketing

C
indirect marketing

D
all of above
Solution
- Franchising is a term used in connection with the provision of services. McDonalds, for instance, operates fast food restaurants the world over through its franchising system.
- Franchising is a “form of licensing in which a parent company (the franchiser) grants another independent entity (the franchisee) the right to do business in a prescribed manner. This right can take the form of selling the franchisers products, ‘using its name, production and marketing technique, or general business approach.” Donald W. Hackett
Question 5
1 / -0

Which among the following allows permission to use the trademark and provides assistance in business for a particular amount?

A
Franchise

B
Government

C
Partnership

D
Company

Solution

A franchisor is a party who owns trademark or trade name. He/She provides support in the form of marketing, advertising, training, sometimes finance in return for an agreed fee.
A franchisee is a party who uses the trade name or trade mark. He/She starts and expands business on the basis support received from franchiser. He/She pays fees to franchiser in return of all the support he/she gets from him/her
Question 6
1 / -0

Liaison office acts as a communication channel between ________.

A
foreign corporation and Indian customers.

B
foreign corporation and educational institutes.

C
foreign corporation and art galleries.

D
none of the above.

Solution

A liaison officer is a person who acts between two organizations to communicate and coordinate their activities. Generally, liaison officers are used to achieving the best utilization of resources or employment of services of one organization by another.
Question 7
1 / -0

Which one of the following is a push factor influencing the internationalization of a company?

A
Difficulty in finding skilled staff in the home country

B
The need to be close to key resources

C
Low-cost labour in other countries

D
Financial incentives from governments in emerging markets
Solution
Some of the reasons why companies wish to become multinationals are:
1. To secure cheaper premises and labour: Cost of land and labour will be cheaper in developing countries.
2. To increase market share: Companies may find they are at saturation point in the domestic market and need a new outlet. They may start by exporting to other countries but eventually they may start production overseas.
Hence, the push factor influencing the internationalization of a company is low-cost labour in other countries.
Question 8
1 / -0

International trade is based on the idea that ____________.

A
exports should exceed imports

B
resources are less mobile internationally

C
resources are more mobile internally than are goods

D
imports should not be there
Solution
- International trade refers to buying and selling of goods and services in different countries. Hence, it is based on the idea that resources are less mobile internationally.
- The fundamental reason behind international trade is that the countries cannot produce equally well or cheaply all that they need. This is because of the unequal distribution of natural resources among them or differences in their productivity levels.
Question 9
1 / -0

Mr X exported goods to Europe but as a dispute between the supplier and buyer the payment was stopped. The possible resolution to get money back is ______?

A
To get the goods back

B
To file a suit using the invoice as support document

C
To forget as nothing can done

D
None of the above
Question 10
1 / -0

For international development of business enterprise, it should always take care of which of the following points?

A
Unnecessary control on Industrial licencing, reduction in tax, rates, socio-cultural

B
Reduction in tax, unnecessary control on Industrial licencing, shareholders

C
Media, socio-cultural, shareholders

D
Unnecessary control on Industrial licencing, reduction in taxes, freedoms in fixing prices

Solution

The national economies are increasingly becoming borderless and getting integrated into the world economy.
Differences in the nationality of parties involved, relatively less mobility of factors of production, customer heterogeneity across markets, variations in business practices and political systems, varied business regulations and policies, use of different currencies are the key aspects that differentiate international businesses from domestic business.
These, moreover, are the factors that make international business much more complex and a difficult activity.
Hence a company entering international markets need to take care of unnecessary control on Industrial licencing, reduction in taxes, freedoms in fixing prices.

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Re-Attempt Weekly Quiz Competition

International Business Test - 16

Result

International Business Test - 16

Score

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Rank

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SHARING IS CARING

Question 1

geographic region exclusively

patents, designs, trade secrets and business know-how

trade marks, copyright and trade secrets

all of the above

Solution

Question 2

Franchise

Network marketing

Indirect marketing

All of above

Solution

Question 3

international movements of capital

domestic production of different goods and services

international movement of labour

international movement of technology

Solution

Question 4

franchising

network marketing

indirect marketing

all of above

Solution

Question 5

Franchise

Government

Partnership

Company

Solution

Question 6

foreign corporation and Indian customers.

foreign corporation and educational institutes.

foreign corporation and art galleries.

none of the above.

Solution

Question 7

Difficulty in finding skilled staff in the home country

The need to be close to key resources

Low-cost labour in other countries

Financial incentives from governments in emerging markets

Solution

Question 8

exports should exceed imports

resources are less mobile internationally

resources are more mobile internally than are goods

imports should not be there

Solution

Question 9

To get the goods back

To file a suit using the invoice as support document

To forget as nothing can done

None of the above

Question 10

Unnecessary control on Industrial licencing, reduction in tax, rates, socio-cultural

Reduction in tax, unnecessary control on Industrial licencing, shareholders

Media, socio-cultural, shareholders

Unnecessary control on Industrial licencing, reduction in taxes, freedoms in fixing prices

Solution

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