1. There are many advantages to exporting, including:

a. Always easier to compete with other firms located in the foreign market

b. Easier to withdraw from a market if it does not meet the firm’s profit and/or sales expectations.

c. Gain experience and test a market before significantly expanding into the foreign market.

d. Less financial risk than other market entry strategies.

e. No supply chain asset investment is needed in the foreign market.

2. Disadvantages of ownership in a foreign market include all of the following except:

a. All financial risks are borne by the firm that utilizes ownership in the foreign market.

b. Exchange rate fluctuations can change the relative value of foreign investments.

c. Firms cannot compete effectively with competitors who use other methods of market entry, such as exporting and joint ventures.

d. Loss of flexibility because the firm has a long-term commitment to the foreign market.

e. The possibility of government nationalization of foreign-owned businesses.

3. Slower or faster growth rates in some foreign markets make it even more necessary that greater discipline be exercised by supply chain executives in planning and ensuring that maximum productivity be achieved for each dollar spent. This would be an example of which uncontrollable element?

a. Economic conditions

b. Geography of the foreign market

c. Political and legal systems of the foreign markets

d. Social and cultural norms of the various target markets.

e. Technology available or accessible.

4. Currency exchange rates would be an example of a micro category of the political and legal uncontrollable environment. T/F

5. Free on board (F.O.B.) determines who is responsible for the various stages of delivery of the product, who bears what risks, and who pays for the various elements of transportation. T/F

6. While firms may or may not be involved in some form of foreign market entry strategy, most are almost always involved in some aspect of importing. T/F

7. As the speed of technological advancement accelerates, it becomes more likely that additional products will undergo “technological obsolescence.” T/F

8. In an exporting strategy, the domestic firm has very little control over the pricing, promotion, or distribution of its product in the foreign market. T/F

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