CE Market Research & Global Sales Strategies 3 — Questions and Answers
Question 1: Which of the following is a PRIMARY source of market research data for export planning?
- World Bank country economic reports
- U.S. Commercial Service market intelligence reports
- Direct customer surveys and focus groups in the target market (Correct answer)
- Industry association trade publications
Correct answer: Direct customer surveys and focus groups in the target market
Primary research data is collected directly from the source (customers, prospects) specifically for the current research need, unlike secondary data published by third parties.
Question 2: The concept of 'psychic distance' in international business refers to:
- The geographic distance between the exporter's country and the target market
- Perceived differences in culture, language, business practices, and legal systems between countries (Correct answer)
- The emotional difficulty of relocating expatriate staff to foreign markets
- Time zone differences that affect cross-border communication
Correct answer: Perceived differences in culture, language, business practices, and legal systems between countries
Psychic distance describes how foreign or unfamiliar a target market feels based on cultural, linguistic, and institutional differences, influencing market selection.
Question 3: A U.S. company wants to assess competitive intensity in a target export market. Which framework is most appropriate for this analysis?
- PESTEL analysis
- Porter's Five Forces (Correct answer)
- SWOT analysis
- Boston Consulting Group matrix
Correct answer: Porter's Five Forces
Porter's Five Forces specifically analyzes competitive intensity through rivalry, new entrants, substitutes, buyer power, and supplier power.
Question 4: When segmenting international markets, 'macrosegmentation' refers to grouping countries based on:
- Individual consumer demographics such as age and income
- Country-level variables such as GDP, trade regulations, and cultural dimensions (Correct answer)
- Psychographic profiles of typical consumers in each country
- Product usage rates across different demographic cohorts
Correct answer: Country-level variables such as GDP, trade regulations, and cultural dimensions
Macrosegmentation groups countries by national-level characteristics before microsegmentation identifies specific customer groups within those countries.
Question 5: A distributor agreement typically grants the foreign partner the right to:
- Manufacture the exporter's products locally under license
- Buy and resell the exporter's products in a defined territory on their own account (Correct answer)
- Negotiate contracts on behalf of the exporter for a commission
- Access the exporter's proprietary technology for local adaptation
Correct answer: Buy and resell the exporter's products in a defined territory on their own account
A distributor purchases goods outright and resells them, taking title and assuming market risk, unlike an agent who earns commission without taking title.
Question 6: Which tool provides U.S. exporters with country-specific tariff rates applied to their products by foreign governments?
- Schedule B database
- Harmonized Tariff Schedule of the United States (HTSUS)
- WTO tariff binding database (Tariff Download Facility) (Correct answer)
- Export.gov tariff calculator
Correct answer: WTO tariff binding database (Tariff Download Facility)
The WTO Tariff Download Facility provides the tariff rates that WTO member countries apply on imports, giving exporters insight into barriers they face abroad.
Question 7: Gray market exports occur when:
- Products are exported without proper documentation
- Genuine products are sold in unauthorized markets outside the intended distribution channel (Correct answer)
- Counterfeit goods are sold using authentic brand packaging
- Exports violate destination country import regulations
Correct answer: Genuine products are sold in unauthorized markets outside the intended distribution channel
Gray market (parallel import) situations arise when authentic products are diverted to markets where the exporter did not intend to sell them, typically exploiting price differentials.
CE Market Research & Global Sales Strategies 3
Which of the following is a PRIMARY source of market research data for export planning?