Chapter $11$

What are the two mechanisms through which firms internationalize?

Know the four types of industries depending on their degree of trade and foreign direct

investment.

What is the theory of comparative advantage?

Understand Porter's "national diamond".

Which factor in this "diamond" makes products like German cars or Japanese cameras so

well$-$designed?

When it comes internationalization decisions about locating production, what are the

determinants of geographical location?

When it comes internationalization decisions about entering a foreign market, what would make

a firm choose exporting over foreign direct investment?

In terms of choosing between global integration and national adaptation, what is a multidomestic

strategy? What about a global strategy?

How do firms reconcile global efficiency with national adaptation?

Chapter $12$

What are Porter's "three essential tests"? $($Know all three of them$)$ What do they aim to

determine?

How do firms achieve value creation from diversification?

What are economies of scope? How do they differ from economies of scale?

What is the difference between related and unrelated diversification?

What does is mean when two businesses are "strategically related"? What about "operationally

related"?

Understand the concept of parenting advantage. How does it differ from Porter's "three essential

tests"?