Questions and Answers of International Management

What are the differences between the political and commercial risks of nonpayment?
Describe the concept of cash in advance.
Describe the process of documentary collection.
Describe the mechanism of a letter of credit, from the exchange of the pro forma invoice to final payment.
What is credit insurance? Why is it associated with open-account transactions?
Several people claim that letters of credit will soon be replaced by the concept of TradeCard. What is this product, and why do some people think it has such a bright future?
Describe the concept of bank guarantees. What are the different types of bank guarantees?
What are three of the possible choices that an exporter can make (in terms of currency) for a specific transaction?
Explain the three different types of exchange rates. Find the three exchange rates for a currency of your choice and explain the values you find.
Explain the three different types of currencies. Give an example of each.
Choose two theories of exchange rate determination and explain them.
What does it mean for a firm to retain its currency-fluctuation risk in a transaction?
There are three types of hedges that a firm can use to protect itself against transaction exposure. Choose one type of hedge and explain it.
There are three types of invoices mentioned in this chapter. Explain each one and identify which is truly an invoice and which is not.
What documents are necessary for exporting from the United States?
There are many different types of certificates that can be requested by the importing country or the importer. Describe three of these certificates.
A pre-shipment inspection certificate can be requested by the importing country or by the importer. Why would a country request one? Why would an importer request one?
The ocean bill of lading has three general functions. Explain each function in detail and identify the alternative “types” of ocean bills of lading.
What are the advantages of conducting international trade using electronic document transmissions, such as EDI, Bolero, and TradeCard?
Describe some of the risks that an ocean shipment faces.
Describe some of the risks that an air shipment faces.
Explain the concept of general average, and explain, with a numerical example, how it is utilized.
Explain the concept of “insurable interest.” Identify who has an insurable interest in three different transactions conducted under three different Incoterms® rules.
What risk-management strategies can an exporter/importer follow? Explain each strategy’s advantages and disadvantages from the perspective of a small exporter.
What insurance coverage is required under the CIF Incoterms® rule? Explain which risks are not covered, and how an importer can still protect itself against them.
Choose three possible marine insurance clauses and describe their usefulness.
Explain the concept of international credit insurance and explain how it is possible to contract a policy covering commercial and political risks.
What are the two different types of ocean cargo services?
Describe three different types of ships used in international ocean transportation.What cargoes are they used for?
Explain the concept of a flag. Why does a ship need a flag? Why would an owner choose to fly a flag of convenience?
What is the Baltic Exchange? What is the purpose of publishing the Baltic Exchange indices?
What are the differences between the Hague Rules, the Hague-Visby Rules, the Hamburg Rules, and the Rotterdam Rules?
What are the two major initiatives of the world governments in terms of cargo security?
Briefly describe the different types of air cargo services available.
Do you think that demand for air cargo will increase or decrease over the next three years? Why?
How does an air carrier determine a shipment costs? What can a shipper do to reduce the costs of shipping a light but voluminous package?
What is project cargo? Use the Internet to find and describe at least one example of the use of air transportation to ship project cargo internationally.
Using the freighter/payload range chart (Figure 12.10 on page 465), what type of airfreighter would you use to ship 60,000 kilograms over 3,500 nautical miles?
What is the purpose of an open-skies agreement?
What are some of the environmental challenges facing the air cargo industry today? How is the industry dealing with these issues?
What is the purpose of the Certified Cargo Screening Program?
What are the Advance Manifest Rules and how do they apply to air shipments bound for the U.S.?
How do ground transport alternatives in various areas of the world differ?What constraints does a shipper face when using ground transport?
What is a land bridge? What effect will land bridges have on the frequency of container use in shipping cargo?
Choose three different types of ocean containers and explain how they are used.
How are ocean-going containers and aircraft containers different?
Comment on the opinion that “the number of cargo handling points is not diminished by using aircraft containers.”
What are the four functions of terminals, regardless of their location or types of goods handled?
What are the principal types of ocean terminals?
What are the characteristics of a general-cargo terminal that make it far more labor intensive than the other types of terminals?
For a company involved in international trade, what are the advantages of using a logistics cluster?
What are the consequences of improper packaging for the exporter? Does your response depend on the Incoterms® rule used? Does it depend on the insurance policy in force?
What are the alternative means of packaging products that are not containerized?
What are some issues and risks that international packaging faces that are not present in a domestic shipment?
Use a product of your choice and ship it from one country to another in a multimodal shipment. What packaging methods would you use? Why?
What are five criteria that can be used to determine the location of a warehouse?
What are the two primary picking strategies in a warehouse?
Describe three techniques that can be used to increase the productivity of a picker. What additional costs do they have over a simple paper list?
What are some of the value-added services that a warehouse can fulfill for an exporter?
Watch a Youtube video about the way Kiva robots operate in an Amazon warehouse. What advantages are there to operating a warehouse with such robots?
Why is the international transportation of hazardous goods very challenging for the logistician? Identify some of the challenges and skills needed to do the job well. What are the risks if a firm
Classification is the first step in the process of transporting hazardous goods. Describe how goods are classified, the classification criteria, and how their classification informs subsequent
How is the hazard level of a dangerous good expressed? When and where must this information be provided and what aspects of a shipment are linked to a product’s hazard level?
Once a packaging method has been determined based upon the product’s hazard level and size, list and describe the components of the packaging code. Which components provide the most critical
Dangerous goods are marked, labeled, and placarded to provide information to assist first responders in the event of an accident. Discuss what information is important for first responders to know
Why is the international transportation of refrigerated goods very challenging for the logistician? Identify some of the challenges and skills needed to do the job well. What are the consequences of
How does packaging of refrigerated products differ from the packaging of dry goods presented in Chapter 15?
It is estimated that as much as 50 percent of all fresh produce harvested is eventually damaged while it is being transported. Explain what can go wrong in the supply chain to cause such a high
Take a trip to your city’s grocery store. Pay close attention to the countries of origin of the produce and fruits that it sells. Investigate the logistics of shipping one of these products from
What are the different main international logistics security programs implemented either by international agencies or national governments?
What are the main differences between the alternative approaches to security taken by the United States and the European Union?
What problems arise in a security policy that is based on one-hundredpercent inspection?
What are the four areas in which a corporation must enact security measures to protect itself against theft and terrorism?
Suppose a disease has an incidence of one percent in the population. The test used to detect this disease has a five percent Type I error rate; there is no Type II error rate. A physician sees test
What is a Harmonized System number? How is it used? What are the advantages of such a system?
Explain the concept of valuation from the perspective of customs. Why is it important to have a detailed commercial invoice for valuation?
Explain the concept of classification from the perspective of customs. Why is it important to have a detailed commercial invoice for classification?
Explain the concept of country of origin. How is it currently determined?Why is it such a difficult concept? Why is it important?
What are non-tariff barriers? Why are they used? Give a few examples.
What are the types of quotas in existence? How does the United States enforce the quotas it imposes? What is a merchandise visa?
Why is cross-border trade more likely between suppliers in one country and consumers in a neighboring country?
What elements make cross-border trade more attractive to a company than international trade with companies located in countries located further away?
Why is cross-border trade also considered “informal trade”?
Have you—or has someone you know—purchased goods on the internet from a supplier not located in your home country? Under what circumstances?In what ways was this transaction significantly
How are cross-border transactions different from parallel imports (graymarket)?
What are the advantages of learning to use International English and Special English in communicating with non-native speakers of English?
What are the advantages of using the metric system in international commerce?
What trade-offs exist for an exporter who wants to implement a standardized policy, but wants to remain flexible? You can choose either terms of payment or Incoterms® rules to illustrate your points.
In your opinion, why is it important for an exporter to sell in the importer country’s currency?
What advantages exist for exporters to have an “environmentally friendly”packaging policy?
To recognize the communication process and how cultural differences can cause noise in that process.
To appreciate the cultural variables that affect communication for both the sender and the listener.
To be aware of the impact of IT on cross-border communications.
To learn how to manage cross-cultural business communications successfully.
How will the perceptions of international managers’ roles affect the way they manage their subordinates?
What are the potential problems an international manager with a low context culture will face when working or negotiating with a high context culture counterpart?
Discuss the role of information systems in a company, how and why they vary from country to country, and the effects of these variations.
Form small groups of three to four students, preferably with different cultural backgrounds. Show them the product catalogs or promotion material of four different brands of automobiles from four
Check with your family, relatives, or friends to identify someone with overseas working experience. Talk to this person and ask him or her to identify the benefits and problems arising from working
If you were a native of Brazil and advising American business representatives about what to do when talking with Brazilian business partners, what would you tell the Americans about Brazilian culture?

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