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web.groovymark@gmail.com
- December 14, 2024
Question 21
What is the main objective of the “sunshine rules” in international remuneration?
a) To enhance employee retention rates
b) To disclose employee salary information
c) To attract global talent
d) To unify pay scales across subsidiaries
Correct Answer: b) To disclose employee salary information
Explanation: Sunshine rules require the disclosure of salaries for transparency, often in regions with high legal or societal expectations around equity and fairness.
Question 22
Which of the following benefits is commonly offered to expatriates in hardship locations?
a) Housing allowance
b) Healthcare insurance
c) Hardship premium
d) Vacation days
Correct Answer: c) Hardship premium
Explanation: Hardship premiums are additional payments offered to expatriates who are assigned to work in locations with difficult living conditions. Options a and b are common benefits but not specific to hardship.
Question 23
What is one of the biggest challenges faced by virtual global teams?
a) High travel costs
b) Time zone differences
c) Language barriers
d) Immigration regulations
Correct Answer: b) Time zone differences
Explanation: Virtual global teams often face challenges due to differences in time zones, making it difficult to schedule meetings and collaborate in real-time. Language barriers can also be an issue, but time zones are more significant.
Question 24
What does “flexibility-security nexus” refer to in the context of global labor markets?
a) Balancing employee rights with flexibility in labor practices
b) Managing employees who work in multiple locations
c) Negotiating between local labor unions and multinational corporations
d) Regulating the exchange of labor between two countries
Correct Answer: a) Balancing employee rights with flexibility in labor practices
Explanation: The flexibility-security nexus involves finding the right balance between providing employee protections while allowing flexibility in labor market practices for competitiveness.
Question 25
Which of the following best describes a “greenfield project” in an international business context?
a) Developing a subsidiary by acquiring a local company
b) Developing a subsidiary by building facilities from scratch
c) Transferring ownership of an existing subsidiary to local managers
d) Closing down a subsidiary and relocating employees
Correct Answer: b) Developing a subsidiary by building facilities from scratch
Explanation: A greenfield project refers to starting from scratch in a foreign location, building everything from the ground up rather than acquiring an existing entity.
Question 26
Which of the following terms best describes multinational corporations (MNCs) that implement centralized decision-making from headquarters while allowing local subsidiaries to adapt?
a) Polycentric
b) Ethnocentric
c) Geocentric
d) Transnational
Correct Answer: d) Transnational
Explanation: Transnational corporations strike a balance between central control and local adaptation. The other terms focus on different strategies regarding staffing and decision-making.
Question 27
What is the term for the process of temporarily moving an employee to work in a subsidiary in another country without changing their employment status?
a) Secondment
b) Localization
c) Repatriation
d) Dual employment
Correct Answer: a) Secondment
Explanation: Secondment refers to temporarily transferring an employee to a foreign subsidiary while keeping their original employment contract in place. Localization involves permanent relocation.
Question 28
Which of the following is a key challenge in managing culturally diverse teams in a multinational enterprise (MNE)?
a) Legal compliance
b) Recruitment costs
c) Cross-cultural communication
d) Local currency fluctuations
Correct Answer: c) Cross-cultural communication
Explanation: Cross-cultural communication is one of the primary challenges in managing culturally diverse teams due to differences in language, cultural norms, and business practices.
Question 29
What does “codetermination” mean in the context of international labor relations?
a) The practice of hiring employees from two different countries to ensure diversity
b) The inclusion of employees in decision-making at the board level
c) The requirement for multinational companies to follow local laws
d) The process of merging two companies from different countries
Correct Answer: b) The inclusion of employees in decision-making at the board level
Explanation: Codetermination refers to laws that require employee representation on company boards or in decision-making processes, particularly in European countries.
Question 30
What is the role of “expatriates” in an international assignment?
a) Employees who work in their home country
b) Employees who are relocated from the parent company to a foreign subsidiary
c) Employees hired locally in the host country
d) Employees who work in multiple countries at once
Correct Answer: b) Employees who are relocated from the parent company to a foreign subsidiary
Explanation: Expatriates are employees who are transferred from the parent company to work in foreign subsidiaries or offices for a defined period.
Question 31
Which approach to staffing international operations involves a combination of host country nationals and parent country nationals to fill key positions in subsidiaries?
a) Polycentric
b) Ethnocentric
c) Regiocentric
d) Mixed-centric
Correct Answer: c) Regiocentric
Explanation: Regiocentric staffing involves selecting employees based on the region rather than the country of the headquarters or host nation, using both parent and host country nationals as appropriate.
Question 32
Which of the following types of equity compensation allows employees to purchase company stock at a discounted price?
a) Employee Stock Ownership Plan (ESOP)
b) Phantom Stock
c) Employee Stock Purchase Plan (ESPP)
d) Stock appreciation rights (SAR)
Correct Answer: c) Employee Stock Purchase Plan (ESPP)
Explanation: ESPPs allow employees to buy company stock at a discounted price, usually through payroll deduction. ESOPs, phantom stock, and SAR are different forms of equity compensation.
Question 33
Which of the following terms refers to laws that extend beyond a country’s borders to regulate the conduct of businesses operating internationally?
a) Endogenous laws
b) Extraterritorial laws
c) Transnational laws
d) Global trade agreements
Correct Answer: b) Extraterritorial laws
Explanation: Extraterritorial laws extend beyond a country’s borders to regulate business conduct abroad. Examples include the U.S. Foreign Corrupt Practices Act (FCPA).
Question 34
Which of the following is a primary consideration in using the balance sheet approach to expatriate compensation?
a) Aligning with local labor laws
b) Ensuring that expatriates can maintain their home-country standard of living
c) Providing cultural training for expatriates
d) Establishing a unified global compensation system
Correct Answer: b) Ensuring that expatriates can maintain their home-country standard of living
Explanation: The balance sheet approach aims to ensure expatriates maintain their home-country standard of living by adjusting for differences in cost of living, taxes, and other expenses.
Question 35
Which of the following is a benefit of adopting a geocentric staffing approach for global operations?
a) It minimizes communication challenges between headquarters and subsidiaries
b) It maximizes control from headquarters over local operations
c) It promotes the best talent regardless of nationality
d) It reduces recruitment costs by focusing on local talent
Correct Answer: c) It promotes the best talent regardless of nationality
Explanation: The geocentric approach selects the best talent globally, without regard for nationality, and fosters a diverse leadership team across the organization.
Question 36
Which of the following is the term for employees who are hired locally in the host country to work for a multinational enterprise’s foreign subsidiary?
a) Expatriates
b) Host Country Nationals (HCNs)
c) Third Country Nationals (TCNs)
d) Parent Country Nationals (PCNs)
Correct Answer: b) Host Country Nationals (HCNs)
Explanation: Host Country Nationals (HCNs) are employees who are hired locally in the country where the multinational enterprise operates a foreign subsidiary.
Question 37
Which of the following is a key feature of an ethnocentric staffing approach?
a) Heavy reliance on host country nationals for senior management positions
b) Preference for parent country nationals in key roles abroad
c) Combination of local and regional hiring practices
d) A focus on hiring third-country nationals
Correct Answer: b) Preference for parent country nationals in key roles abroad
Explanation: Ethnocentric staffing focuses on filling key roles in subsidiaries with parent country nationals to maintain control and consistency with the home office.
Question 38
What is the main focus of “performance management” in an international context?
a) Monitoring only local employee behaviors
b) Aligning employee performance with global strategic objectives
c) Focusing on personal relationships over performance metrics
d) Developing individual team-building skills
Correct Answer: b) Aligning employee performance with global strategic objectives
Explanation: International performance management ensures that the performance of individuals and teams aligns with the organization’s global strategic goals.
Question 39
Which of the following is the purpose of an International Joint Venture (IJV)?
a) To merge two companies from the same country
b) To create a separate legal entity owned by parent firms from different countries
c) To expand one company’s operations without sharing control
d) To outsource key business functions to another country
Correct Answer: b) To create a separate legal entity owned by parent firms from different countries
Explanation: An International Joint Venture (IJV) is a separate legal entity created and owned by parent firms from different countries to achieve mutual goals.
Question 40
What is the goal of a “global talent management inventory” in multinational enterprises (MNEs)?
a) To track local candidates for short-term roles
b) To maintain electronic records of employees’ knowledge, skills, and abilities across the organization
c) To manage expatriates’ relocation
d) To centralize payroll systems across multiple countries
Correct Answer: b) To maintain electronic records of employees’ knowledge, skills, and abilities across the organization
Explanation: A global talent management inventory tracks and manages employee competencies, experiences, and development needs throughout the multinational organization.
