In countries where high inflation is the rule, companies should make price adjustments to maintain operating margins.
Answer: TRUE
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International Marketing Chapter 11
- Luxury good marketers found a new way to combat gray market imports into the United States. In March 1995, the U.S. Supreme Court let stand an appeals court ruling prohibiting a discount drugstore chain from selling Givenchy perfume with permission. The distinctive packaging of the perfume is also protected by the U.S. Copyright law. The ruling implies that:
- Despite the high expenses associated with operating elegant stores and purchasing advertising space in upscale magazines, the premium retail prices that luxury goods like Louis Vuitton command translate into handsome profits. The Louis Vuitton brand alone accounts for 60 percent of LVMH's operating profit. On the other hand, Louis Vuitton spends $ 10 million annually battling:
- Which of the following companies would be most likely to use some form of countertrade when selling its products in developing countries?
- Suppose that World Corp. signs a contract to build a lumber processing plant in Siberia. If World Corp. signs a second contract agreeing to take partial payment for the plant in the form of lumber products produced at the plant, it is engaging in:
- When one of the parties to a barter transaction is not willing to accept the goods included in the transaction, that party is likely to utilize the services of a:
- To win a contract to supply the United Kingdom with AWACS military aircraft, Boeing agreed to purchase products from the UK whose value was equivalent to 130 percent of the contract. This type of pricing arrangement, which is common when the customer is a foreign government and the product has military applications, is known as:
- Which type of countertrade arrangement is required by governments seeking to reduce the budgetary impact of expenditures for defense or telecommunications?
- Which of the following forms of countertrade does not require use of money or credit between parties?
- The direct exchange of goods or services between parties in lieu of monetary payment is known as:
- In the 1970s and 1980s, the arrangement by which PepsiCo received payment for soft drink products sold to the Soviet Union was:
- The most general term for the global phenomenon involving reciprocal business interactions between parties in various countries is known as:
- Which of the following is true about proper use of the term "countertrade?"
- Joseph Quinlan, chief marketing strategist at Bank of America, estimated that about 25 percent of U.S. merchandise exports represent shipments by American companies to their foreign affiliates and subsidiaries. This situation underscores the importance of ________ in global marketing.
- "Cost-based," "market-based," and "negotiated" are three approaches to:
- Nintendo was fined nearly $ 150 million after it was determined that the video game company had colluded with European distributors. The distributors in countries with lower retail prices had agreed not to sell to retailers in countries with high prices. This is a classic example of:
- Germany's Bayer Group was fined millions of dollars to settle a lawsuit alleging it had conspired with Archer Daniels Midland and other global companies to set prices for an enzyme used in animal feeds. What was the issue in this lawsuit?
- If a company sells products in export markets at prices that are below fair market value and that can harm producers in the export market, that company may be accused of:
- Following the 1997 currency crisis in Asia, which American industry appealed to President Clinton for protection from foreign producers that were allegedly "dumping" products in the United States:
- In the early 1990s, the U.S. International Trade Commission ruled that several Japanese manufacturers were selling active-matrix flat panel display screens in the U.S. at less than fair value and thereby injuring the sole U.S. producer of similar screens. The ITC's ruling concerned:
- When Tag Heuer, a marketer of luxury watches, takes out newspaper ads urging consumers to purchase Tag Heuer products from authorized dealers only, the company is most likely attempting to combat the ________ problem.
- The unauthorized distribution of trademarked goods to exploit price differentials in world markets is known as:
- If company managers decide to set the export price for a particular product at an amount equivalent to the home country price, they would be using which approach to pricing?
- Which of the following would NOT be taken into account by a company using an ethnocentric approach to pricing decisions?
- Which of the following pricing strategies recognizes both local market differences and the importance of headquarters input into pricing decisions?
- Which automaker was described as using an ethnocentric approach to setting prices in the United States?