MIB International Marketing Strategy 1 — Questions and Answers
Question 1: Which pricing strategy involves setting a low initial price to quickly gain market share in a new international market?
- Market penetration pricing (Correct answer)
- Price skimming
- Cost-plus pricing
- Value-based pricing
Correct answer: Market penetration pricing
Market penetration pricing sets low initial prices to rapidly capture market share and deter competitors in new international markets.
Question 2: What is the term for adapting a product and its marketing mix to suit local market conditions in international business?
- Standardization
- Localization (Correct answer)
- Diversification
- Segmentation
Correct answer: Localization
Localization involves tailoring products, messaging, and marketing mix elements to fit the cultural, legal, and consumer preferences of specific local markets.
Question 3: A company sells its products in a foreign market below the cost of production to eliminate competition. This practice is known as:
- Transfer pricing
- Predatory pricing
- Dumping (Correct answer)
- Grey market pricing
Correct answer: Dumping
Dumping is the practice of exporting goods at prices lower than their production cost or home-market price, often subject to anti-dumping duties.
Question 4: Which global market entry mode provides the highest degree of control but also the highest financial risk?
- Licensing
- Franchising
- Wholly owned subsidiary (Correct answer)
- Joint venture
Correct answer: Wholly owned subsidiary
A wholly owned subsidiary gives the parent company full control over operations but requires the largest capital investment and bears all financial risk alone.
Question 5: The concept of 'glocalization' in international marketing refers to:
- Exporting only to global cities
- Combining global standardization with local adaptation (Correct answer)
- Focusing solely on emerging markets
- Eliminating local intermediaries
Correct answer: Combining global standardization with local adaptation
Glocalization blends a globally consistent brand strategy with locally adapted products and campaigns to resonate with specific regional audiences.
Question 6: Which of the following best describes a 'born global' firm?
- A firm that only operates domestically
- A firm that internationalizes rapidly from inception (Correct answer)
- A multinational that acquires local firms
- A firm that exclusively uses licensing
Correct answer: A firm that internationalizes rapidly from inception
Born global firms pursue international markets from or near their founding, bypassing the traditional stage-by-stage internationalization process.
MIB International Marketing Strategy 1
Which pricing strategy involves setting a low initial price to quickly gain market share in a new international market?