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GBM811S - Global Business Management - 1st OPP - JUN 2023 |
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n Am I BI A u n IVE Rs ITY
OF SCIEnCE Ano TECHnOLOGY
FACULTYOF COMMERCEH, UMANSCIENCEAS ND EDUCATION
DEPARTMENTOFGOVERNANCEAND MANAGEMENTSCIENCE
QUALIFICATION: BACHELOR OF MANAGEMENT
QUALIFICATION CODE: 07BBMA
LEVEL: 8
COURSE CODE: GBM811S
COURSE NAME: GLOBALBUSINESSMANAGEMENT
SESSION: JUNE 2023
DURATION: 3 HOURS
PAPER: 1
MARKS: 100
EXAMINER(S)
MODERATOR:
FIRST OPPORTUNITY EXAMINATION QUESTION PAPER MEMO
Prof. A.R Asa
Ms O.N Kangandjo
Mr M B Simasiku
THIS QUESTION PAPERMEMO CONSISTSOF 4 PAGES(Including this front page)
INSTRUCTIONS
1.
Answer all questions.
2.
Read all the questions carefully before answering.
3.
Marks for each question are indicated at the end of each question.
4.
Please ensure that your writing is legible, neat and presentable and start each Section on a
new page.
PERMISSIBLEMATERIALS
1. Examination question paper
2. Examination answer sheet
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!SECTION~
Question 1
[80 Marks]
1.1 Differentiate between international trade and globalisation.
(5)
1.2 Discuss how declining trade and investment barriers had contributed to globalisation. (10)
1.3 When a firm decides to enter into international business, it faces two major decision problems.
Ellaborate on those two decision problems.
(10)
1.4 The value and norms of a culture do not emerge fully formed. They evolve over time in response
to several factors. What are the determinants of culture? List five of those determinants. (10)
1.5 Language is one of the defining characteristics of culture. Consider the importance of unspoken
language. Why is it important for business people to be familiar with the unspoken language of
another culture?
(4)
1.6 Several levels of economic integration are possible. Outline these different levels of regional
economic integration from least integrated to most integrated.
(10)
1.7 What are the two types of competitive pressures faced by firms that compete in the global
marketplace? How do firms respond to each of these pressures?
(5)
1.8 Discussthe factors that lead to pressure for local responsiveness.
(10)
1.9 What is considered normal practice in one country may be considered unethical in others.
Discussthis statement from an international business perspective.
(6)
1.10 Managers in multinational firms need to be sensitive to differences in ethical issues. Identify
ethical issues that are most relevant in the international business setting which managers ought
to be aware of.
(10)
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lsECTIOsNl
Question 2
Read the case study below and answer the questions thereafter.
[20 Marks]
The Politicaland LegalRealities of Doing Businessin Russia
Paying bribes to gain favors, whether small or large accounts, is commonplace in many countries. In
Russiait is not unusual for business people to make payments to facilitate business, and some bribes
exceed US$100,000, enough to buy a small flat in Moscow. Survey data suggest that most Russians
consider paying bribes a normal cost of doing business.
Counterfeiting is also a problem. Take a walk through the open-air markets in Moscow, and you will
likely find vendors selling pirated software, music, and movies. Russian police are aware of these
products but usually do not issue fines or arrest the sellers. Some corrupt officers even get a cut of
the vendors' total sales.
In the corruption index compiled by Transparency International, Russia ranks high among countries
where kickbacks and questionable business practices exist. Because of a weak legal environment, the
country is a tough place to do business. Prime Minister Vladimir Putin even remarked that anyone
who successfully registers a business in Russiadeserves a medal. Vague and overlapping regulations
enrich a host of public officials. Any new venture may necessitate dozens of government licenses, and
each license may require paying a bribe. There are also countless incidents of strong-handed
government interference in the private sector. Criminal raiders, sometimes in collaboration with
government officials, seize independently operating businesses. One well-known example is Yukos,
an oil company once controlled by the Russian industrialist Mikhail Khodorkovsky, who has been
imprisoned by government for alleged tax evasion. Claiming that Yukos owed back taxes, Russia's
government sold part of the firm and kept the $9.3 billion in proceeds.
Organised crime is also part of the difficult landscape. In 2006, the deputy chairman of Russia'scentral
bank was shot dead in Moscow. He was trying to reform a corrupt banking system and had closed
dozens of banks linked to organised crime, making enemies in the process. Numerous other contract
killings have occurred, as criminal organisations attempt to maintain their stronghold on much of
Russia's economy. Criminal groups are believed to control some large Russian firms. Foreign
Multinational Enterprises routinely perform background checks on employees and contractors in an
effort to identify people linked to organised crime. Foreign companies also attempt to provide for the
security of staff and facilities.
One consequence of these challenges is that direct investors are often hesitant to do business in
Russia. Indeed, some have pulled out altogether, taking tens of billions of dollars with them.
Corruption and crime have raised doubts about Russia'sevolving legal system and its commitment to
market economics. Things have gotten so bad that the country's bid to join the World Trade
Organisation (WTO) was temporarily abandoned.
Russia is transitioning from a command economy to a market economy. The shift has created much
uncertainty for foreign firms doing business there. Ambiguous (vague or unclear) regulations,
inadequate laws, capricious (unpredictable) enforcement, a rudimentary (not very well developed)
court system, and a formerly totalitarian government all pose numerous difficulties. Managers must
be mindful of the political and legal environments that characterise transition economies. Although
they can take precautionary measures to minimise risk, not all risk is avoidable. Numerous firms, from
Boeing to IKEA, have invested billions in Russia. Potential rewards are promising for firms that plan
ahead and protect their assets, but operating there poses many challenges.
Source: Cavusgil, S.T, Knight G, Riesenberger J. (2017). International Business. Pearson
2.1 Discussthe major risks that businessesface in going into international business, use examples
from the case study to support your answer.
(10)
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2.2 Demonstrate the relationship between Political Systems and Economic Systems, also justify
which economic system Russiafalls under.
(10)
END OF QUESTION PAPER
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