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web.groovymark@gmail.com
- December 14, 2024
Question 41
What is one of the key challenges of managing “heterogeneous teams” in a multinational enterprise (MNE)?
a) Ensuring compliance with local labor laws
b) Navigating cultural differences and ensuring effective communication
c) Reducing the cost of expatriate assignments
d) Implementing standardized HR practices across all subsidiaries
Correct Answer: b) Navigating cultural differences and ensuring effective communication
Explanation: Heterogeneous teams consist of members from diverse cultural backgrounds, which can create challenges in communication, decision-making, and collaboration due to varying perspectives and cultural norms.
Question 42
What is the primary purpose of using “phantom stock” plans in employee compensation?
a) To give employees the option to purchase company stock at a discounted rate
b) To provide employees with simulated stock units that mirror the value of real company shares
c) To offer employees stock options that vest over a specific period of time
d) To allow employees to receive dividends from company profits without purchasing stock
Correct Answer: b) To provide employees with simulated stock units that mirror the value of real company shares
Explanation: Phantom stock plans grant employees simulated equity, where they receive payouts based on the increase in the company’s stock value, without being granted actual shares, providing an incentive aligned with company performance.
Question 43
Which of the following describes the “balance sheet approach” used for expatriate compensation?
a) An approach where expatriates are paid a fixed salary regardless of location
b) A method of ensuring that expatriates’ compensation is adjusted to maintain their home-country standard of living
c) A strategy to reduce expatriate compensation by aligning it with host-country norms
d) A compensation model that provides only non-monetary benefits to expatriates
Correct Answer: b) A method of ensuring that expatriates' compensation is adjusted to maintain their home-country standard of living
Explanation: The balance sheet approach is designed to keep expatriates' purchasing power on par with what they would have in their home country by adjusting for cost of living, tax, and housing differences in the host country.
Question 44
What does the term “stealth assignees” refer to in the context of international human resource management?
a) International assignees who do not inform their managers about their assignments
b) International assignees who are relocated by their managers without HR’s involvement or formal records
c) International assignees who work in multiple countries without proper legal documentation
d) International assignees who operate under false names or identities
Correct Answer: b) International assignees who are relocated by their managers without HR’s involvement or formal records
Explanation: Stealth assignees are international employees who are assigned to roles in foreign locations without being formally tracked or recorded in the company’s HR systems, often bypassing standard HR processes for international assignments.
Question 45
What does “extra-territorial laws” refer to in the context of multinational enterprises (MNEs)?
a) Laws that apply only to the country where a multinational enterprise is headquartered
b) Laws that extend beyond a country’s borders and apply to companies doing business with that country
c) Laws that govern international trade agreements between countries
d) Laws that are applicable only to host-country nationals working for a multinational enterprise
Correct Answer: b) Laws that extend beyond a country’s borders and apply to companies doing business with that country
Explanation: Extra-territorial laws are laws that have written provisions extending their applicability beyond a country’s borders. For example, the U.S. Foreign Corrupt Practices Act (FCPA) applies to companies doing business with the U.S. even if their headquarters are not in the U.S.
Question 46
What is a “greenfield project” in the context of multinational business expansion?
a) The acquisition of an existing company in a foreign market
b) The development of new facilities or operations from scratch in a foreign market
c) The restructuring of existing facilities in a foreign subsidiary
d) The hiring of expatriates to manage a foreign subsidiary
Correct Answer: b) The development of new facilities or operations from scratch in a foreign market
Explanation: A greenfield project refers to building new operations from the ground up in a foreign market, allowing multinational companies to establish new facilities that meet their specific needs.
Question 47
What is the purpose of “localization” in the context of expatriate assignments?
a) To ensure expatriates adopt local customs and business practices
b) To reduce expatriates’ compensation to align with local salary norms after several years abroad
c) To transfer expatriates back to their home country after a short-term assignment
d) To maintain the same compensation level for expatriates throughout their assignment
Correct Answer: b) To reduce expatriates' compensation to align with local salary norms after several years abroad
Explanation: Localization refers to gradually adjusting an expatriate’s compensation package to align with local salary structures, often after the expatriate has lived in the host country for an extended period and is converted to a permanent transfer.
Question 48
What is the main objective of “international recruitment” in multinational enterprises?
a) To recruit only host-country nationals for leadership roles
b) To attract and hire global talent from both within and outside the organization
c) To centralize the hiring process at headquarters
d) To reduce recruitment costs by hiring only local talent
Correct Answer: b) To attract and hire global talent from both within and outside the organization
Explanation: International recruitment focuses on attracting and hiring qualified candidates from a global talent pool, including both internal employees and external candidates, to meet the needs of multinational enterprises.
Question 49
Which of the following describes the role of “corporate social responsibility” (CSR) in multinational enterprises?
a) Ensuring compliance with local labor laws in each subsidiary
b) Contributing positively to society by addressing social, environmental, and ethical issues
c) Reducing the cost of expatriate assignments by aligning with local compensation norms
d) Centralizing all HR decisions at the headquarters level
Correct Answer: b) Contributing positively to society by addressing social, environmental, and ethical issues
Explanation: Corporate social responsibility (CSR) refers to the actions and mindset of multinational enterprises in contributing positively to society, addressing social, environmental, and ethical challenges as part of their operations.
Question 50
What is the main focus of “international benefits” in global HR management?
a) Providing expatriates with additional compensation during assignments
b) Offering benefits such as healthcare, pensions, and flexible options to employees working internationally
c) Reducing the cost of employee benefits across all subsidiaries
d) Standardizing benefits packages for employees in different countries
Correct Answer: b) Offering benefits such as healthcare, pensions, and flexible options to employees working internationally
Explanation: International benefits are additional benefits provided to employees working abroad, including healthcare, pension plans, and flexible benefits options, ensuring they are well-supported during their international assignments.
