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3 Assessing Foreign Markets Online Quiz Questions

Use this free practice quiz with 20 questions to review 3 Assessing Foreign Markets, test your knowledge, and prepare for your next test or exam.

20 questions
01
True or false
1 point

True or false: A large foreign market with unreliable delivery infrastructure may require more inventory and local distribution capacity than a smaller, well-connected market.

  1. A

    True

  2. B

    False

02
Written response
1 point

Rather than treating a country’s whole population as one market, what should a business estimate for its specific customer segment to assess affordability?

03
Fill in the blank
1 point

To avoid relying on national averages when assessing a target customer segment, estimate that segment’s .

04
Choose all
1 point

Which measures are included in the World Bank’s Worldwide Governance Indicators? Select all that apply.

  1. A

    Political stability

  2. B

    Logistics performance

  3. C

    Government effectiveness

  4. D

    Foreign-equity limits

  5. E

    Regulatory quality

  6. F

    Applied tariffs

  7. G

    Rule of law

  8. H

    Control of corruption

05
Choose one
1 point

A country has strong average income figures, but most of a product’s likely customers live in lower-income rural areas. What is the most useful next step in assessing demand?

  1. A

    Use national income averages as a complete measure of what all households can afford.

  2. B

    Identify the intended customer segment and estimate its purchasing power.

  3. C

    Assume that a large population guarantees sufficient demand for the product.

  4. D

    Prioritize market size over customer affordability.

06
Written response
1 point

Which type of tariff does WTO data distinguish from a country’s bound commitments when investigating market access?

07
Fill in the blank
1 point

The OECD compares formal statutory barriers to foreign direct investment using its .

08
True or false
1 point

True or false: A country’s governance indicator scores predict the outcome a particular company will experience there.

  1. A

    True

  2. B

    False

09
Choose one
1 point

A company wants to screen countries for formal barriers to foreign investment. What can the OECD’s FDI Regulatory Restrictiveness Index help it compare?

  1. A

    It predicts whether a specific company will succeed in the market.

  2. B

    It measures every practical difficulty a company may encounter during operations.

  3. C

    It compares formal restrictions such as foreign-equity limits and investment screening.

  4. D

    It replaces the need to review current laws and obtain local advice.

10
Choose all
1 point

Which practices make a weighted foreign-market scorecard more useful and responsible? Select all that apply.

  1. A

    Give greater weight to criteria that matter more to the company’s strategy.

  2. B

    Document the evidence and uncertainty behind each rating.

  3. C

    Treat the highest overall score as an objective guarantee of success.

  4. D

    Use the score as a screening aid rather than an objective prediction.

11
Choose one
1 point

A company has limited capital and depends on fast, reliable delivery. Market A has more potential customers but higher delivery costs and complex product approvals. Market B is smaller but has better logistics and clearer product rules. Which conclusion best fits the company’s circumstances?

  1. A

    Choose Market A because a larger customer base is always the best opportunity.

  2. B

    Choose Market B initially because its logistics and product rules better fit the company’s constraints.

  3. C

    Reject Market B because a smaller market cannot offer a viable opportunity.

  4. D

    Choose Market A because complex approvals reduce the need for local investment.

12
Open ended
1 point

A company is comparing two foreign markets for a new product. Describe a systematic process it could use to compare the opportunities, costs, and risks, and explain how it should interpret a weighted scorecard.

13
Choose one
1 point

A company is considering a country with a large population, but incomes vary substantially between urban and rural areas. What should it do first to assess whether demand is reachable?

  1. A

    Treat the country’s total population as the likely customer base.

  2. B

    Identify the intended customer segment and estimate its purchasing power.

  3. C

    Use national income per person as a complete substitute for customer research.

  4. D

    Assume that a larger market will always produce more revenue.

14
Choose one
1 point

A firm with limited capital depends on fast, reliable delivery. Market A is larger but has unreliable transport; Market B is smaller but has stronger logistics. Which conclusion best applies the material?

  1. A

    The smaller market may be more promising because better logistics can support reliable delivery at lower operating complexity.

  2. B

    The larger market is necessarily stronger because its customer base is bigger.

  3. C

    The larger market is preferable because infrastructure affects only customer demand, not business costs.

  4. D

    The smaller market is automatically preferable because it has fewer potential customers.

15
Choose one
1 point

A manager wants to use the Worldwide Governance Indicators when screening countries. Which use is consistent with their stated limitations?

  1. A

    They identify the exact probability that a particular company's investment will succeed.

  2. B

    They replace the need to research a country's rules and operating conditions.

  3. C

    They provide comparative governance measures that can help with screening but do not predict a specific company's outcome.

  4. D

    They measure only formal restrictions on foreign equity ownership.

16
Choose one
1 point

A business wants to compare formal barriers to foreign investment across countries, such as ownership limits and screening. Which measure is designed for this purpose?

  1. A

    It predicts whether a foreign company will earn a profit in a particular country.

  2. B

    It compares formal restrictions such as foreign-equity limits and investment screening.

  3. C

    It measures how reliably shipments arrive at ports and through customs.

  4. D

    It determines whether legal rules are enforced consistently in practice.

17
Choose one
1 point

A company relies on one country for a key supplier and a major share of its revenue. When assessing political risk there, what should it evaluate?

  1. A

    Estimate both the likelihood of disruption and the firm's exposure, including dependence on facilities, suppliers, or revenue in that country.

  2. B

    Focus only on how likely political disruption is, because exposure does not affect business impact.

  3. C

    Assume that political changes matter only if they lead to armed conflict.

  4. D

    Ignore risks to suppliers and facilities if the company sells to customers in several countries.

18
True or false
1 point

The World Justice Project Rule of Law Index can help compare aspects of how legal rules are enforced in practice, but it does not replace reviewing current laws and contracts in the target market.

  1. A

    True

  2. B

    False

19
Written response
1 point

What World Bank index compares customs, transport infrastructure, logistics services, and shipment reliability?

20
Written response
1 point

What OECD index compares statutory restrictions on foreign direct investment, including foreign-equity limits and investment screening?