TBChap 004

Chapter 04
Differences in Culture
True / False Questions
1. In today's world of global communications, rapid transportation, and global markets, cultural
differences have ceased to exist.
True False
2. Norms are abstract ideas about what a group believes to be good, right, and desirable.
True False
3. Folkways include rituals and symbolic behavior.
True False
4. Upon meeting a foreign business executive, a Japanese executive will hold his business card in both
hands and bow while presenting the card to the foreigner. This is an example of ritual behavior.
True False
5. Individualism has led to a high degree of managerial mobility between companies resulting in
managers who have good general skills but lack company-specific experience.
True False
6. In countries where the value of group identification is considered to be primary, managers and
workers are discouraged from moving from company to company.
True False
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Education.
7. The term social strata refers to the extent to which individuals can move out of the strata into which
they were born.
True False
8. A caste system is a closed system of stratification in which social position is determined by the family
into which the person is born.
True False
9. A class system is a rigid form of social stratification in which the position a person has by birth cannot
be changed through his/her own achievements or luck.
True False
10. An antagonistic relationship between management and labor classes may result in lower costs of
production.
True False
11. According to Max Weber, Protestantism encouraged capitalism's development by emphasizing the
importance of wealth creation and frugality.
True False
12. Like Christianity and Judaism, Islam is a polytheistic religion.
True False
13. The mudarabah contract is the most widely used Islamic banking method, because it is the easiest to
implement.
True False
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Education.
14. Max Weber thought that devout Hindus would be less likely to engage in entrepreneurial activity than
devout Protestants.
True False
15. Both Hindus and Buddhists stress the afterlife and spiritual achievement rather than involvement in this
world.
True False
16. Guanxi is an important mechanism for building long-term business relationships and getting business
done in China.
True False
17. Education plays an important role, from an international business perspective, as a determinant of
national competitive advantage.
True False
18. Hofstede's study found that in masculine cultures, sex roles were less sharply distinguished, and little
differentiation was made between men and women in the same job.
True False
19. Hofstede's research has been criticized because it was culturally bound.
True False
20. Hofstede's concept of power distance focused on the extent to which different cultures socialized their
members into tolerating uncertainty.
True False
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Education.
21. According to Hofstede, the concept of Confucian dynamism captures attitudes toward time,
persistence, protection of face, and respect for tradition.
True False
22. The convergence hypothesis states that there is a slow but steady merging occurring across different
cultures towards some universally accepted values and norms.
True False
23. International businesses that are ill-informed about the practices of another culture are likely to fail.
True False
24. The value systems and norms of a country are unrelated to the costs of doing business in that
country.
True False
25. Because of its individualistic mindset, Japanese culture is more supportive of entrepreneurial activities
than American culture.
True False
Multiple Choice Questions
26. Which of the following is true regarding culture?
A. Culture is not static.

B. Culture does not vary across and within nations.
C. Culture is a system of values and norms that are kept between each individual.
D. Culture involves the knowledge and beliefs of one individual.
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Education.
27. The protection of the right to private property is embedded within _____.
A. Islam
B. Christianity
C. Hinduism
D. Protestantism
28. The connection between _____ and _____ has important implications for the choice of countries in
which to locate production facilities and do business.
A. culture; competitive advantage

B. moral principles; values
C. class system; society
D. values; norms
29. Cross-cultural literacy refers to:
A. an individual's self-concept derived from perceived membership in a relevant social group.

B. the phenomenon of merging and converging cultures.
C. abstract ideas about what a group believes to be good, right, and desirable.
D. an understanding of how cultural differences can affect business.
30. In countries where the value of _____ identification is considered to be primary, managers and workers
are discouraged from moving from company to company.
A. individual
B. group
C. cultural
D. primary
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Education.
31. _____ is/are best defined as shared assumptions about how things ought to be.
A. Norms
B. Values
C. Society
D. Culture
32. Culture is ________.
A. static
B. not static
C. unchanging
D. abstract
33. The system of values and norms that are shared among a group of people and that when taken
together constitute a design for living best defines _____.
A. society
B. value systems
C. principles
D. culture
34. Social rules and guidelines that prescribe appropriate behavior in particular situations are best
described as _____.
A. norms
B. values
C. culture
D. society
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Education.
35. Hofstede's concept of power distance focused on:
A. the extent to which different cultures socialized their members into tolerating uncertainty.
B. how a society deals with the fact that people are unequal in physical and intellectual capabilities.
C. attitudes toward time, persistence, protection of face, and respect for tradition.
D. the relationship between gender and work roles.
36. Norms refer to:
A. the social rules and guidelines that prescribe appropriate behavior in particular situations.
B. a system of values that are shared among a group of people.
C. the routine conventions of everyday life.
D. abstract ideas about what a group believes to be good, right, and desirable.
37. These are typically defined on the basis of characteristics such as family background, occupation, and
income.
A. Social strata
B. Norms
C. Social structure
D. Groups
38. A group of people who share a common set of values and norms form a _____.
A. culture
B. society
C. country
D. caste
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Education.
39. Even if a _____ can be characterized as having a single homogeneous culture, often that national
culture is a mosaic of subcultures.
A. culture
B. society
C. country
D. norm
40. _____ are the routine conventions of everyday life.
A. Folkways
B. Mores
C. Rites
D. Beliefs
41. The term _____ also means culture.
A. folkway
B. society
C. country
D. norm
42. _____ are social conventions concerning things such as the appropriate dress code in a particular
situation, good social manners, eating with the correct utensils, neighborly behavior, and the like.
A. Values
B. Beliefs
C. Mores
D. Folkways
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Education.
43. An act, as simple as shaking hands when meeting new people is an example of _____.
A. values
B. symbolic behavior
C. mores
D. social stratification
44. A Japanese executive's ritual of presenting a business card to a foreign business executive is an
example of _____.
A. mores
B. values
C. attitudes
D. folkways
45. Mores are:
A. the norms that are seen as central to the functioning of a society and its social life.
B. the routine conventions of everyday life.
C. abstract ideas about what a group believes to be right, good, and desirable.
D. the social rules and guidelines that prescribe appropriate behavior in particular situations.
46. Max Weber coined the term _____ to denote the tendency on the part of Protestants to work hard and
accumulate wealth.
A. Protestant work ethic

B. Protestant belief system
C. Protestant devotion
D. Protestant morale
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Education.
47. Which of the following statements about values and norms of a culture is true?
A. The values and norms of a society emerge fully formed.

B. The values and norms of a society are not the evolutionary product of a number of factors.
C. The values and norms of a society are not influenced by religion.
D. The values and norms of a society influence social structure.
48. A society's social structure refers to its:
A. system of values and norms.

B. basic social organization.
C. religious practices.
D. educational infrastructure.
49. The social organization of Western society tends to emphasize on:
A. a group orientation.
B. collectivist values.
C. individual achievement.
D. work groups.
50. The emphasis on individualism in the United States results in which of the following advantages?
A. Managers tend to develop good general skills as well as company-specific experience.

B. Teams are built within an organization to perform collective tasks.
C. Executives are exposed to different ways of doing business.
D. It is easy to achieve cooperation—both within a company and between companies.
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Education.
51. Which of the following is a consequence of the emphasis on individual performance in many Western
societies?
A. Decreased entrepreneurship
B. High degree of managerial mobility
C. Increased loyalty towards an individual company
D. Executives are not exposed to different ways of doing business
52. Which of the following refers to the extent to which individuals can move out of the strata into which
they are born?
A. Caste stratification
B. Class system
C. Social mobility
D. Individual potential
53. Which of the following is a closed system of stratification in which social position is determined by the
family into which a person is born, and change in that position is usually not possible during an
individual's lifetime?
A. Caste system
B. Class system
C. Social system
D. Cultural system
54. A _____ is a less rigid form of social stratification in which social mobility is possible.
A. caste system
B. normative system
C. religious system
D. class system
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Education.
55. Which of the following statements is true about a class system?
A. A class system is a more rigid form of social stratification, compared to a caste system.
B. A class system is a closed form of stratification.
C. Social mobility within a class system varies from society to society.
D. In a class system, social position is determined at birth and cannot be changed during an
individual's lifetime.
56. A caste system differs from a class system because:
A. a caste system is an open system of stratification, while a class system is a closed system of
stratification.
B. it is not possible for an individual to change his or her caste, while a class system allows people to
change their class through individual achievement.
C. the social mobility in caste systems varies from society to society, while in a class system there is no
social mobility.
D. a caste system is a less rigid form of social stratification, while a class system is a comparatively
more rigid form of social stratification.
57. A condition where people tend to perceive themselves in terms of their class background and this
shapes their relationships with members of other classes is known as _____.
A. class stratification
B. social mobility
C. class mobility
D. class consciousness
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Education.
58. An upper-middle-class manager tends to have hostile relationship with the working-class employees in
the firm because of his tendency to perceive himself as superior to them based on his class
background. In this example, the manager exhibits _____.
A. class consciousness
B. cultural awareness
C. social mobility
D. group orientation
59. Ethical systems are:
A. a set of moral principles, or values, that are used to guide and shape behavior.
B. shared beliefs and rituals that are concerned with the realm of the sacred.
C. routine conventions of everyday life.
D. social rules that govern people's actions toward each other.
60. Religion may be defined as:
A. routine conventions of everyday life.

B. social rules that govern people's actions toward each other.
C. shared beliefs and rituals that are concerned with the realm of the sacred.
D. a set of moral principles, or values, that are used to guide and shape behavior.
61. Max Weber theorized that there was a relationship between Protestantism and the emergence of
modern capitalism because:
A. Protestant ethics emphasize the importance of hard work and wealth creation and frugality.
B. Protestantism promotes the hierarchical domination of religious and social life.
C. Protestantism states that spiritual growth is more important than material wealth.
D. Protestantism promotes blind loyalty to employers.
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Education.
62. Which of the following sociologists made a connection between Protestant ethics and "the spirit of
capitalism"?
A. Karl Marx
B. Max Weber
C. Amartya Sen
D. Adam Smith
63. Hinduism and Buddhism both stress the importance of _____.
A. the caste system

B. the afterlife
C. Confucian ethics
D. life on earth
64. According to Islam, those who hold property are regarded as _____.
A. trustees
B. owners
C. tenants
D. speculators
65. Which of the following observations is correct?
A. The economic principles established in the Koran are against free enterprise.
B. The economic principles of Islam prohibit the payment or receipt of interest.
C. The Koran speaks disapprovingly of earning legitimate profit through trade and commerce.
D. Protection of the right to private property is not embedded within Islam.
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Education.
66. Under the mudarabah banking system, when an Islamic bank lends money to a business:
A. it charges that business interest on the loan.

B. the business needs to pay back the loan with an additional markup.
C. it has to donate the interest received on the loan to a charitable trust.
D. it takes a share in the profits that are derived from the investment.
67. Which of the following statements is true about the murabaha contract?
A. Under the murabaha contract, when an Islamic bank lends money to a business it takes a share in
the profits that are derived from the investment.
B. Under the murabaha contract, money deposited in a savings account is treated as an equity
investment in whatever activity the bank uses the capital for.
C. The murabaha contract is widely used among the world's Islamic banks because it is the easiest to
implement.
D. The murabaha contract is a more efficient system than the Western banking system since it
encourages both long-term savings and long-term investment.
68. Hindus believe:
A. that there is but the one true omnipotent God.

B. in reincarnation, or rebirth into a different body, after death.
C. in the importance of individual religious freedom.
D. that material quest is more important than spiritual quest.
69. A major difference between Buddhism and Hinduism is that unlike Hinduism, Buddhism:
A. does not support the caste system.

B. emphasizes wealth creation.
C. promotes blind loyalty to employers.
D. supports extreme ascetic behavior.
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Education.
70. There are three values central to the Confucian system of ethics that have very important economic
implications. Which of the following is one of these?
A. Filial piety
B. Rule-based law
C. Humaneness
D. Honesty in dealings with others
71. Which of the following statements about the use of spoken language is true?
A. The nature of a language has no effect on the way we perceive the world.
B. The language of a society does not direct the attention of its members to certain features of the
world rather than others.
C. Countries with more than one language often only have one culture.
D. Most people prefer to converse in their own language rather than English.
72. The _____ dimension of Hofstede's study explores how a society deals with the fact that people are
unequal in physical and intellectual capabilities.
A. power distance
B. individualism versus collectivism
C. uncertainty avoidance
D. masculinity versus femininity
73. The individualism versus collectivism dimension of Hofstede's study explored:
A. the extent to which different cultures socialized their members into accepting ambiguous situations
and tolerating uncertainty.
B. the relationship between gender and work roles.
C. how a society deals with the fact that people are unequal in physical and intellectual capabilities.
D. the relationship between the individual and his/her fellows.
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Education.
74. Hofstede's uncertainty avoidance dimension considered:
A. the extent to which different cultures socialized their members into accepting ambiguous situations
and tolerating uncertainty.
D. the relationship between the individual and his or her fellows.
75. The _____ is a research project spanning more than 100 countries that explores people's values and
norms, how they change over time, and what impact they have in society and business.
A. World Values Survey

B. Global Leadership and Organization Behavior Effectiveness Instrument
C. Indulgence Versus Restraints Survey
D. Chinese Value Survey
76. According to Geert Hofstede's study, which of the following cultural dimensions would be
characterized by a greater readiness to take risks and less emotional resistance to change?
A. High power distance cultures

B. Low uncertainty avoidance
C. High collectivism
D. Low power distance cultures
77. The _____ instrument is designed to address the notion that a leader's effectiveness is contextual. It is
embedded in the societal and organizational norms, values, and beliefs of the people being led.
A. GLOBE
B. WVS
C. IND
D. CVS
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Education.
78. The _____ refers to the extent to which a culture programs its citizens to accept delayed gratification of
their material, social, and emotional needs.
A. long-term versus short-term orientation dimension

B. indulgence versus restraint dimension
D. power distance dimension
79. Hofstede's dimension of Confucian dynamism:
A. captures attitudes toward time, persistence, ordering by status, protection of face, respect for
tradition, and reciprocation of gifts and favors.
B. focuses on how a society deals with the fact that people are unequal in physical and intellectual
capabilities.
C. explores the relationship between the individual and his/her fellows.
D. looks at the relationship between gender and the ability to accept ambiguous situations.
80. Which of the following is an example of ethnocentrism?
A. A manager in India looks down upon his subordinates because they are from a lower caste,
compared to him.
B. An upper-middle-class woman talks rudely to a sales person, because she looks down upon
individuals belonging to the working-class.
C. An American manager criticizes the cultural practices of Saudi Arabia, when he is sent there on
business, because it differs from his own cultural norms.
D. A French business owner, who plans to expand his market to China, conducts a detailed cultural
study of China to customize his marketing campaign.
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Education.
81. For international businesses, the connection between culture and competitive advantage is important
because:
A. a weak connection is likely to encourage isolationism.

B. a weak connection is likely to encourage competition.
C. a strong connection is likely to produce the most viable competitors.
D. a strong connection is likely to hamper innovation.
82. What is ethnocentrism?
A. A belief in the superiority of one's business or organization over another.

B. A belief in the superiority of another group or culture over one's own group or culture.
C. A belief in the superiority of one's own ethnic group or culture.
D. A belief in the superiority of one's self over another person.
83. Class-based conflict between workers and management in class-conscious societies can lead to:
A. increased costs of doing business.

B. decreased costs of doing business.
C. companies going out of business.
D. workers looking for new jobs in other businesses.
84. Max Weber was a German sociologist who, in 1904, made the connection between _____ and "the spirit
of capitalism."
A. Protestant ethics
B. ethnocentrism
C. cross-cultural literacy
D. collectivism
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Education.
85. The concept of mobility between castes within an individual's lifetime:
A. is an opportunity to adopt positions of responsibility and influence in society.

B. makes no sense to traditional Hindus.
C. shows a figurative "reincarnation" of a person.
D. is a sign of spiritual progression to traditional Hindus.
86. According to _____, suffering originates in people's desires for pleasure.
A. Hinduism
B. Protestantism
C. Buddhism
D. Judaism
87. Several studies have shown the economic advancement and _____ are important factors in societal
change.
A. individualism
B. collectivism
C. improved technology
D. globalization
88. One reason for the shift in values away from collectivism and toward individualism may be:
A. that richer societies exhibit less need for social and material support structures built on collectives.
B. individualism is a more important trait in a global society.
C. that richer societies exhibit more need for social and material support structures built on collectives.
D. increased urbanization and improvements in the quality and availability of education are both a
function of economic progress.
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Education.
89. _____ refers to a society that allows relatively free gratification of basic and natural human drives
related to enjoying life and having fun.
A. Persistence
B. Indulgence
C. Reciprocation
D. Restraint
90. Hofstede's _____ dimension measured the extent to which different cultures socialized their members
into accepting ambiguous situations and tolerating uncertainty.
A. power distance
B. long-term versus short-term orientation
D. indulgence versus restraint
91. Hofstede's masculinity versus femininity dimension looked at the relationship between gender and
work roles and found that in:
A. feminine cultures, sex roles were sharply differentiated, and traditional "feminine values" determined
cultural ideals.
B. feminine cultures, sex roles were less sharply distinguished, however, there was a great deal of
differentiation between men and women in the same job.
C. masculine cultures, sex roles were less sharply distinguished, and little differentiation was made
between men and women in the same job.
D. masculine cultures, sex roles were sharply differentiated, and traditional "masculine values"
determined cultural ideals.
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Education.
92. Hofstede's results, as might be expected, showed that nations such as _____ scored low on long-term
orientation.
A. the United States and Canada

B. Denmark and Sweden
C. Japan and Thailand
D. Great Britain and Mexico
93. The term _____ to refer to a group of people sharing a common set of values and norms.
A. mores
B. society
C. culture
D. folkway
94. _____ include such factors as indictments against theft, adultery, incest, and cannibalism.
A. Norms
B. Folkways
C. Mores
D. Values
95. A _____ is an association of two or more individuals who have a shared sense of identity and who
interact with each other in structured ways on the basis of a common set of expectations about each
other's behavior.
A. society
B. collective
C. social strata
D. group
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Education.
Essay Questions
96. Compare and contrast folkways and mores.
97. Discuss the relationship between society and the nation-state.
98. What are the determinants of culture?
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Education.
99. Explain the concept of social stratification.
100. Discuss why the stratification of a society is important to business.
101. What is the connection between religion and ethical systems? Do they have any implications for
business?
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Education.
102. Explain how the Koran views business.
103. Consider the influence of Confucian ethics on the economies of China, Japan, South Korea, and
Taiwan.
104. Consider the importance of unspoken language. Why is it important to be familiar with the unspoken
language of another culture?
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Education.
105. Why is the role of education in a culture important to international companies?
106. Describe the four dimensions of culture as identified by Geert Hofstede.
107. Discuss the limitations of Hofstede's research.
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Education.
108. Discuss Confucian dynamism. Explore the debate over whether Confucian dynamism is good for an
economy.
109. What are the implications of cultural differences for international businesses?
110. Discuss the relationship between culture and national competitive advantage?
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Education.
Chapter 04 Differences in Culture Answer Key
True / False Questions
1. In today's world of global communications, rapid transportation, and global markets, cultural
differences have ceased to exist.
FALSE
In these days of global communications, rapid transportation, worldwide markets, and global
brands, when the era of the global village seems just around the corner, it is easy to forget just how
different various cultures really are. Underneath the veneer of modernism, deep cultural differences
often remain.
AACSB: Knowledge Application

Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 04-01 Explain what is meant by the culture of a society.
Topic: What is Culture?
2. Norms are abstract ideas about what a group believes to be good, right, and desirable.
FALSE
Norms refer to the social rules and guidelines that prescribe appropriate behavior in particular
situations.

Blooms: Remember
Difficulty: 1 Easy
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Education.
3. Folkways include rituals and symbolic behavior.
TRUE
Folkways include rituals and symbolic behavior. Rituals and symbols are the most visible
manifestations of a culture and constitute the outward expression of deeper values.

Blooms: Remember
Difficulty: 1 Easy
4. Upon meeting a foreign business executive, a Japanese executive will hold his business card in both
hands and bow while presenting the card to the foreigner. This is an example of ritual behavior.
TRUE
Rituals and symbols are the most visible manifestations of a culture and constitute the outward
expression of deeper values. For example, upon meeting a foreign business executive, a Japanese
executive will hold his business card in both hands and bow while presenting the card to the
foreigner.
AACSB: Diversity
Blooms: Understand
Difficulty: 2 Medium
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Education.
5. Individualism has led to a high degree of managerial mobility between companies resulting in
managers who have good general skills but lack company-specific experience.
TRUE
The lack of loyalty and commitment to an individual company, and the tendency to move on for a
better offer, can result in managers who have good general skills but lack the knowledge,
experience, and network of interpersonal contacts that come from years of working within the same
company.
AACSB: Reflective Thinking

Blooms: Understand
Learning Objective: 04-03 Identify the business and economic implications of differences in culture.
Topic: Social Culture
6. In countries where the value of group identification is considered to be primary, managers and
TRUE
The primacy of the value of group identification discourages managers and workers from moving
from company to company.
AACSB: Diversity
Blooms: Understand
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Education.
7. The term social strata refers to the extent to which individuals can move out of the strata into which
they were born.
FALSE
All societies are stratified on a hierarchical basis into social categories—that is, into social strata.
These strata are typically defined on the basis of characteristics such as family background,
occupation, and income.

Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 04-02 Identify the forces that lead to differences in social culture.
8. A caste system is a closed system of stratification in which social position is determined by the
family into which the person is born.
TRUE
A caste system is a closed system of stratification in which social position is determined by the

Blooms: Remember
Difficulty: 1 Easy
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Education.
9. A class system is a rigid form of social stratification in which the position a person has by birth
cannot be changed through his/her own achievements or luck.
FALSE
A class system is a less rigid form of social stratification in which social mobility is possible. It is a
form of open stratification in which the position a person has by birth can be changed through his
or her own achievements or luck.

Blooms: Remember
Difficulty: 1 Easy
10. An antagonistic relationship between management and labor classes may result in lower costs of
production.
FALSE
An antagonistic relationship between management and labor classes, and the resulting lack of
cooperation and high level of industrial disruption, tends to raise the costs of production in
countries characterized by significant class divisions.
AACSB: Communication
Blooms: Understand
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Education.
11. According to Max Weber, Protestantism encouraged capitalism's development by emphasizing the
importance of wealth creation and frugality.
TRUE
Weber argued that Protestant ethics emphasize the importance of hard work and wealth creation
(for the glory of God) and frugality (abstinence from worldly pleasures). According to Weber, this
kind of value system was needed to facilitate the development of capitalism.
AACSB: Ethics
Blooms: Understand
Topic: Economic and Business Implications of Cultural Change
12. Like Christianity and Judaism, Islam is a polytheistic religion.
FALSE
Like Christianity and Judaism, Islam is a monotheistic religion. The central principle of Islam is that
there is but the one true omnipotent God.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
Topic: Elements of Culture
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Education.
13. The mudarabah contract is the most widely used Islamic banking method, because it is the easiest
to implement.
FALSE
The Islamic banking method, the murabaha contract, is the most widely used among the world's
Islamic banks, primarily because it is the easiest to implement.

Blooms: Remember
Difficulty: 1 Easy
14. Max Weber thought that devout Hindus would be less likely to engage in entrepreneurial activity
than devout Protestants.
TRUE
Max Weber argued that the ascetic principles embedded in Hinduism do not encourage the kind of
entrepreneurial activity in pursuit of wealth creation found in Protestantism. Given the emphasis on
an ascetic lifestyle, Weber thought that devout Hindus would be less likely to engage in
entrepreneurial activity than devout Protestants.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
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Education.
15. Both Hindus and Buddhists stress the afterlife and spiritual achievement rather than involvement in
this world.
TRUE
Like Hindus, Buddhists stress the afterlife and spiritual achievement rather than involvement in this
world.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
16. Guanxi is an important mechanism for building long-term business relationships and getting
business done in China.
TRUE
In a society that lacks a rule-based legal tradition, and thus legal ways of redressing wrongs such as
violations of business agreements, guanxi is an important mechanism for building long-term
business relationships and getting business done in China.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Topic: Ethical Issues in International Business
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Education.
17. Education plays an important role, from an international business perspective, as a determinant of
national competitive advantage.
TRUE
From an international business perspective, one important aspect of education is its role as a
determinant of national competitive advantage. The availability of a pool of skilled and educated
workers seems to be a major determinant of the likely economic success of a country.

Blooms: Remember
Difficulty: 1 Easy
18. Hofstede's study found that in masculine cultures, sex roles were less sharply distinguished, and
little differentiation was made between men and women in the same job.
FALSE
Hofstede's masculinity versus femininity dimension looked at the relationship between gender and
work roles. In masculine cultures, sex roles were sharply differentiated and traditional "masculine
values," such as achievement and the effective exercise of power, determined cultural ideals.
AACSB: Diversity
Blooms: Understand
Learning Objective: 04-04 Recognize how differences in social culture influence values in business.
Topic: Hofstede's Framework
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Education.
19. Hofstede's research has been criticized because it was culturally bound.
TRUE
Hofstede's research may have been culturally bound. The research team was composed of
Europeans and Americans. Hofstede's results confirm Western stereotypes, because it was
Westerners who undertook the research.

Blooms: Remember
Difficulty: 1 Easy
20. Hofstede's concept of power distance focused on the extent to which different cultures socialized
their members into tolerating uncertainty.
FALSE
Hofstede's power distance dimension focused on how a society deals with the fact that people are
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
4-37
Education.
21. According to Hofstede, the concept of Confucian dynamism captures attitudes toward time,
persistence, protection of face, and respect for tradition.
TRUE
According to Hofstede, Confucian dynamism captures attitudes toward time, persistence, ordering
by status, protection of face, respect for tradition, and reciprocation of gifts and favors. The label
refers to these "values" being derived from Confucian teachings.

Blooms: Remember
Difficulty: 1 Easy
22. The convergence hypothesis states that there is a slow but steady merging occurring across
different cultures towards some universally accepted values and norms.
TRUE
With regard to globalization, some have argued that advances in transportation and
communication technologies are helping to create conditions for the merging or convergence of
cultures. There may be, in other words, a slow but steady convergence occurring across different
cultures towards some universally accepted values and norms: This is known as the convergence
hypothesis.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 04-05 Demonstrate an appreciation for the economic and business implications of cultural change.
4-38
Education.
23. International businesses that are ill-informed about the practices of another culture are likely to
fail.
TRUE
International businesses that are ill-informed about the practices of another culture are likely to fail.
Doing business in different cultures requires adaptation to conform to the value systems and norms
of that culture.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
Topic: The Nature of Cross-Cultural Risk
24. The value systems and norms of a country are unrelated to the costs of doing business in that
country.
FALSE
The value systems and norms of a country influence the costs of doing business in that country.
The costs of doing business in a country influence the ability of firms to establish a competitive
advantage in the global marketplace.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
4-39
Education.
25. Because of its individualistic mindset, Japanese culture is more supportive of entrepreneurial
activities than American culture.
FALSE
It has been argued that the Japanese culture is less supportive of entrepreneurial activities than,
say, American culture. In many ways, entrepreneurial activity is a product of an individualistic
mindset, which is not a classic characteristic of the Japanese.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
Multiple Choice Questions
26. Which of the following is true regarding culture?
A. Culture is not static.

B. Culture does not vary across and within nations.
C. Culture is a system of values and norms that are kept between each individual.
D. Culture involves the knowledge and beliefs of one individual.
Culture is not static. It can and does evolve, although the rate at which culture can change is the
subject of some dispute.

Blooms: Remember
Difficulty: 1 Easy
4-40
Education.
27. The protection of the right to private property is embedded within _____.
A. Islam
B. Christianity
C. Hinduism
D. Protestantism
The protection of the right to private property is also embedded within Islam, although Islam
asserts that all property is a favor from Allah (God), who created and so owns everything. Those
who hold property are regarded as trustees rather than owners in the Western sense of the word.

Blooms: Remember
Difficulty: 1 Easy
28. The connection between _____ and _____ has important implications for the choice of countries in
which to locate production facilities and do business.
A. culture; competitive advantage

B. moral principles; values
C. class system; society
D. values; norms
The connection between culture and competitive advantage has important implications for the
choice of countries in which to locate production facilities and do business.

Blooms: Remember
Difficulty: 1 Easy
4-41
Education.
29. Cross-cultural literacy refers to:
A. an individual's self-concept derived from perceived membership in a relevant social group.

B. the phenomenon of merging and converging cultures.
C. abstract ideas about what a group believes to be good, right, and desirable.
D. an understanding of how cultural differences can affect business.
Cross-cultural literacy refers to an understanding of how cultural differences across and within
nations can affect the way business is practiced.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
30. In countries where the value of _____ identification is considered to be primary, managers and
A. individual
B. group
C. cultural
D. primary
The primacy of the value of group identification discourages managers and workers from moving
from company to company.
AACSB: Diversity
Blooms: Understand
4-42
Education.
31. _____ is/are best defined as shared assumptions about how things ought to be.
A. Norms
B. Values
C. Society
D. Culture
Values refer to abstract ideas about what a group believes to be good, right, and desirable. Put
differently, values are shared assumptions about how things ought to be.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
32. Culture is ________.
A. static
B. not static
C. unchanging
D. abstract
Culture is not static. It can and does evolve, although the rate at which culture can change is the
subject of some dispute.

Blooms: Remember
Difficulty: 1 Easy
4-43
Education.
33. The system of values and norms that are shared among a group of people and that when taken
together constitute a design for living best defines _____.
A. society
B. value systems
C. principles
D. culture
Culture is a system of values and norms that are shared among a group of people and that when
taken together constitute a design for living.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
34. Social rules and guidelines that prescribe appropriate behavior in particular situations are best
described as _____.
A. norms
B. values
C. culture
D. society
situations.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
4-44
Education.
35. Hofstede's concept of power distance focused on:
A. the extent to which different cultures socialized their members into tolerating uncertainty.
B. how a society deals with the fact that people are unequal in physical and intellectual capabilities.
C. attitudes toward time, persistence, protection of face, and respect for tradition.
D. the relationship between gender and work roles.

Blooms: Remember
Difficulty: 1 Easy
36. Norms refer to:
A. the social rules and guidelines that prescribe appropriate behavior in particular situations.
B. a system of values that are shared among a group of people.
C. the routine conventions of everyday life.
D. abstract ideas about what a group believes to be good, right, and desirable.
situations.

Blooms: Remember
Difficulty: 1 Easy
4-45
Education.
37. These are typically defined on the basis of characteristics such as family background, occupation,
and income.
A. Social strata
B. Norms
C. Social structure
D. Groups
situations.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
38. A group of people who share a common set of values and norms form a _____.
A. culture
B. society
C. country
D. caste
Society refers to a group of people who share a common set of values and norms.

Blooms: Remember
Difficulty: 1 Easy
4-46
Education.
39. Even if a _____ can be characterized as having a single homogeneous culture, often that national
culture is a mosaic of subcultures.
A. culture
B. society
C. country
D. norm
The relationship between culture and country is often ambiguous. Even if a country can be
characterized as having a single homogeneous culture, often that national culture is a mosaic of
subcultures. To abide by these cultural nuances, businesspeople should be aware of the delicate
issues pertaining to folkways.

Blooms: Remember
Difficulty: 1 Easy
40. _____ are the routine conventions of everyday life.
A. Folkways
B. Mores
C. Rites
D. Beliefs
Folkways are the routine conventions of everyday life. They are social conventions concerning
things such as the appropriate dress code in a particular situation, good social manners, eating with
the correct utensils, neighborly behavior, and the like.

Blooms: Remember
Difficulty: 1 Easy
4-47
Education.
41. The term _____ also means culture.
A. folkway
B. society
C. country
D. norm
The relationship between culture and country is often ambiguous. Even if a country can be
characterized as having a single homogeneous culture, often that national culture is a mosaic of
subcultures. To abide by these cultural nuances, businesspeople should be aware of the delicate
issues pertaining to folkways.

Blooms: Remember
Difficulty: 1 Easy
42. _____ are social conventions concerning things such as the appropriate dress code in a particular
situation, good social manners, eating with the correct utensils, neighborly behavior, and the like.
A. Values
B. Beliefs
C. Mores
D. Folkways
Folkways are the routine conventions of everyday life. They are social conventions concerning
things such as the appropriate dress code in a particular situation, good social manners, eating with
the correct utensils, neighborly behavior, and the like.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
4-48
Education.
43. An act, as simple as shaking hands when meeting new people is an example of _____.
A. values
B. symbolic behavior
C. mores
D. social stratification
Folkways include rituals and symbolic behavior. Rituals and symbols are the most visible
manifestations of a culture and constitute the outward expression of deeper values.

Blooms: Understand
44. A Japanese executive's ritual of presenting a business card to a foreign business executive is an
example of _____.
A. mores
B. values
C. attitudes
D. folkways
Folkways are the routine conventions of everyday life. Folkways include rituals and symbolic
behavior. For example, upon meeting a foreign business executive, a Japanese executive will hold
his business card in both hands and bow while presenting the card to the foreigner.
AACSB: Ethics
Blooms: Understand
4-49
Education.
45. Mores are:
A. the norms that are seen as central to the functioning of a society and its social life.
B. the routine conventions of everyday life.
C. abstract ideas about what a group believes to be right, good, and desirable.
D. the social rules and guidelines that prescribe appropriate behavior in particular situations.
Mores are norms that are seen as central to the functioning of a society and to its social life.
Accordingly, violating mores can bring serious retribution.

Blooms: Remember
Difficulty: 1 Easy
46. Max Weber coined the term _____ to denote the tendency on the part of Protestants to work hard
and accumulate wealth.
A. Protestant work ethic

B. Protestant belief system
C. Protestant devotion
D. Protestant morale
Max Weber coined the term Protestant work ethic to denote the tendency on the part of
Protestants to work hard and accumulate wealth.
AACSB: Diversity
Blooms: Understand
4-50
Education.
47. Which of the following statements about values and norms of a culture is true?
A. The values and norms of a society emerge fully formed.

B. The values and norms of a society are not the evolutionary product of a number of factors.
C. The values and norms of a society are not influenced by religion.
D. The values and norms of a society influence social structure.
While factors such as social structure and religion clearly influence the values and norms of a
society, the values and norms of a society can influence social structure and religion.

Blooms: Understand
48. A society's social structure refers to its:
A. system of values and norms.

B. basic social organization.
C. religious practices.
D. educational infrastructure.
A society's social structure refers to its basic social organization.

Blooms: Remember
Difficulty: 1 Easy
4-51
Education.
49. The social organization of Western society tends to emphasize on:
A. a group orientation.
B. collectivist values.
C. individual achievement.
D. work groups.
In general, Western societies tend to emphasize the primacy of the individual, whereas groups tend
to figure much larger in many other societies.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
50. The emphasis on individualism in the United States results in which of the following advantages?
A. Managers tend to develop good general skills as well as company-specific experience.

B. Teams are built within an organization to perform collective tasks.
C. Executives are exposed to different ways of doing business.
D. It is easy to achieve cooperation—both within a company and between companies.
One positive aspect of high managerial mobility is that executives are exposed to different ways of
doing business.

Blooms: Understand
4-52
Education.
51. Which of the following is a consequence of the emphasis on individual performance in many
Western societies?
A. Decreased entrepreneurship
B. High degree of managerial mobility
C. Increased loyalty towards an individual company
D. Executives are not exposed to different ways of doing business
The emphasis on individual performance in many Western societies has both beneficial and harmful
aspects. Individualism finds expression in a high degree of managerial mobility between companies,
and this is not always a good thing.

Blooms: Understand
52. Which of the following refers to the extent to which individuals can move out of the strata into
which they are born?
A. Caste stratification
B. Class system
C. Social mobility
D. Individual potential
The term social mobility refers to the extent to which individuals can move out of the strata into
which they are born. Social mobility varies significantly from society to society. The most rigid
system of stratification is a caste system.

Blooms: Remember
Difficulty: 1 Easy
4-53
Education.
53. Which of the following is a closed system of stratification in which social position is determined by
the family into which a person is born, and change in that position is usually not possible during an
individual's lifetime?
A. Caste system
B. Class system
C. Social system
D. Cultural system

Blooms: Remember
Difficulty: 1 Easy
54. A _____ is a less rigid form of social stratification in which social mobility is possible.
A. caste system
B. normative system
C. religious system
D. class system
A class system is a less rigid form of social stratification in which social mobility is possible.

Blooms: Remember
Difficulty: 1 Easy
4-54
Education.
55. Which of the following statements is true about a class system?
A. A class system is a more rigid form of social stratification, compared to a caste system.
B. A class system is a closed form of stratification.
C. Social mobility within a class system varies from society to society.
D. In a class system, social position is determined at birth and cannot be changed during an
A class system is a less rigid form of social stratification in which social mobility is possible. While
many societies have class systems, social mobility within a class system varies from society to
society.

Blooms: Understand
56. A caste system differs from a class system because:
A. a caste system is an open system of stratification, while a class system is a closed system of
stratification.
B. it is not possible for an individual to change his or her caste, while a class system allows people
to change their class through individual achievement.
C. the social mobility in caste systems varies from society to society, while in a class system there is
no social mobility.
D. a caste system is a less rigid form of social stratification, while a class system is a comparatively
more rigid form of social stratification.
individual's lifetime. A class system is a form of open stratification in which the position a person
has by birth can be changed through his or her own achievements or luck.
4-55
Education.
Blooms: Understand
57. A condition where people tend to perceive themselves in terms of their class background and this
shapes their relationships with members of other classes is known as _____.
A. class stratification
B. social mobility
C. class mobility
D. class consciousness
Class consciousness refers to a condition where people tend to perceive themselves in terms of
their class background, and this shapes their relationships with members of other classes.

Blooms: Remember
Difficulty: 1 Easy
58. An upper-middle-class manager tends to have hostile relationship with the working-class
employees in the firm because of his tendency to perceive himself as superior to them based on his
class background. In this example, the manager exhibits _____.
A. class consciousness
B. cultural awareness
C. social mobility
D. group orientation
Class consciousness refers to a condition where people tend to perceive themselves in terms of
their class background, and this shapes their relationships with members of other classes.
AACSB: Analytical Thinking
4-56
Education.
Blooms: Apply
59. Ethical systems are:
A. a set of moral principles, or values, that are used to guide and shape behavior.
B. shared beliefs and rituals that are concerned with the realm of the sacred.
C. routine conventions of everyday life.
D. social rules that govern people's actions toward each other.
Ethical systems refer to a set of moral principles, or values, that are used to guide and shape
behavior.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
60. Religion may be defined as:
A. routine conventions of everyday life.

B. social rules that govern people's actions toward each other.
C. shared beliefs and rituals that are concerned with the realm of the sacred.
D. a set of moral principles, or values, that are used to guide and shape behavior.
Religion may be defined as a system of shared beliefs and rituals that are concerned with the realm
of the sacred.

Blooms: Remember
Difficulty: 1 Easy
4-57
Education.
61. Max Weber theorized that there was a relationship between Protestantism and the emergence of
modern capitalism because:
A. Protestant ethics emphasize the importance of hard work and wealth creation and frugality.
B. Protestantism promotes the hierarchical domination of religious and social life.
C. Protestantism states that spiritual growth is more important than material wealth.
D. Protestantism promotes blind loyalty to employers.
Weber argued that Protestant ethics emphasize the importance of hard work and wealth creation
(for the glory of God) and frugality (abstinence from worldly pleasures). According to Weber, this
kind of value system was needed to facilitate the development of capitalism.
AACSB: Ethics
Blooms: Understand
Topic: Philosophical Approaches to Ethics
62. Which of the following sociologists made a connection between Protestant ethics and "the spirit of
capitalism"?
A. Karl Marx
B. Max Weber
C. Amartya Sen
D. Adam Smith
In 1904, a German sociologist, Max Weber, made a connection between Protestant ethics and "the
spirit of capitalism" that has since become famous. Weber theorized that there was a relationship
between Protestantism and the emergence of modern capitalism.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
4-58
Education.
Topic: Philosophical Approaches to Ethics
63. Hinduism and Buddhism both stress the importance of _____.
A. the caste system

B. the afterlife
C. Confucian ethics
D. life on earth
Hinduism and Buddhism both stress the importance of the afterlife.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
64. According to Islam, those who hold property are regarded as _____.
A. trustees
B. owners
C. tenants
D. speculators
The protection of the right to private property is also embedded within Islam, although Islam
asserts that all property is a favor from Allah (God), who created and so owns everything. Those
who hold property are regarded as trustees rather than owners in the Western sense of the word.

Blooms: Remember
Difficulty: 1 Easy
Topic: Ethics and Social Responsibility
4-59
Education.
65. Which of the following observations is correct?
A. The economic principles established in the Koran are against free enterprise.
B. The economic principles of Islam prohibit the payment or receipt of interest.
C. The Koran speaks disapprovingly of earning legitimate profit through trade and commerce.
D. Protection of the right to private property is not embedded within Islam.
One economic principle of Islam prohibits the payment or receipt of interest, which is considered
usury. This is not just a matter of theology; in several Islamic states, it is also a matter of law.

Blooms: Understand
66. Under the mudarabah banking system, when an Islamic bank lends money to a business:
A. it charges that business interest on the loan.

B. the business needs to pay back the loan with an additional markup.
C. it has to donate the interest received on the loan to a charitable trust.
D. it takes a share in the profits that are derived from the investment.
A mudarabah contract is similar to a profit-sharing scheme. Under mudarabah, when an Islamic

bank lends money to a business, rather than charging that business interest on the loan, it takes a
share in the profits that are derived from the investment.

Blooms: Remember
Difficulty: 1 Easy
4-60
Education.
67. Which of the following statements is true about the murabaha contract?
A. Under the murabaha contract, when an Islamic bank lends money to a business it takes a share
in the profits that are derived from the investment.
B. Under the murabaha contract, money deposited in a savings account is treated as an equity
investment in whatever activity the bank uses the capital for.
C. The murabaha contract is widely used among the world's Islamic banks because it is the easiest
to implement.
D. The murabaha contract is a more efficient system than the Western banking system since it
encourages both long-term savings and long-term investment.
The Islamic banking method, the murabaha contract, is the most widely used among the world's
Islamic banks, primarily because it is the easiest to implement.

Blooms: Understand
68. Hindus believe:
A. that there is but the one true omnipotent God.

B. in reincarnation, or rebirth into a different body, after death.
C. in the importance of individual religious freedom.
D. that material quest is more important than spiritual quest.
Hindus believe in reincarnation, or rebirth into a different body, after death. Hindus also believe in
karma, the spiritual progression of each person's soul.

Blooms: Understand
4-61
Education.
69. A major difference between Buddhism and Hinduism is that unlike Hinduism, Buddhism:
A. does not support the caste system.

B. emphasizes wealth creation.
C. promotes blind loyalty to employers.
D. supports extreme ascetic behavior.
Unlike Hinduism, Buddhism does not support the caste system. Nor does Buddhism advocate the
kind of extreme ascetic behavior that is encouraged by Hinduism.
AACSB: Diversity
Blooms: Understand
70. There are three values central to the Confucian system of ethics that have very important economic
implications. Which of the following is one of these?
A. Filial piety
B. Rule-based law
C. Humaneness
D. Honesty in dealings with others
The influence of Confucian ethics on the culture of China, Japan, South Korea, and Taiwan, by
lowering the costs of doing business in those countries, may help explain their economic success. In
this regard, three values central to the Confucian system of ethics are of particular interest: loyalty,
reciprocal obligations, and honesty in dealings with others.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
4-62
Education.
71. Which of the following statements about the use of spoken language is true?
A. The nature of a language has no effect on the way we perceive the world.
B. The language of a society does not direct the attention of its members to certain features of the
world rather than others.
C. Countries with more than one language often only have one culture.
D. Most people prefer to converse in their own language rather than English.
Most people prefer to converse in their own language, and being able to speak the local language
can build rapport, which may be very important for a business deal.

Blooms: Remember
Difficulty: 1 Easy
Topic: How Language Affects Culture?
72. The _____ dimension of Hofstede's study explores how a society deals with the fact that people are
A. power distance
B. individualism versus collectivism
D. masculinity versus femininity
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
4-63
Education.
73. The individualism versus collectivism dimension of Hofstede's study explored:
A. the extent to which different cultures socialized their members into accepting ambiguous
situations and tolerating uncertainty.
D. the relationship between the individual and his/her fellows.
The individualism versus collectivism dimension focused on the relationship between the individual
and his or her fellows.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
74. Hofstede's uncertainty avoidance dimension considered:
A. the extent to which different cultures socialized their members into accepting ambiguous
situations and tolerating uncertainty.
D. the relationship between the individual and his or her fellows.
Hofstede's uncertainty avoidance dimension measured the extent to which different cultures
socialized their members into accepting ambiguous situations and tolerating uncertainty.
AACSB: Diversity
Blooms: Remember
Difficulty: 1 Easy
4-64
Education.
75. The _____ is a research project spanning more than 100 countries that explores people's values and
norms, how they change over time, and what impact they have in society and business.
A. World Values Survey

B. Global Leadership and Organization Behavior Effectiveness Instrument
C. Indulgence Versus Restraints Survey
D. Chinese Value Survey
The WVS includes dimensions for support for democracy; tolerance of foreigners and ethnic
minorities; support for gender equality; the role of religion and changing levels of religiosity; the
impact of globalization; attitudes toward the environment, work, family, politics, national identity,
culture, diversity, and insecurity; and subjective well-being.

Blooms: Remember
76. According to Geert Hofstede's study, which of the following cultural dimensions would be
characterized by a greater readiness to take risks and less emotional resistance to change?
A. High power distance cultures

B. Low uncertainty avoidance
C. High collectivism
D. Low power distance cultures
socialized their members into accepting ambiguous situations and tolerating uncertainty. Lower
uncertainty avoidance cultures were characterized by a greater readiness to take risks and less
emotional resistance to change.
AACSB: Diversity
Blooms: Apply
4-65
Education.
77. The _____ instrument is designed to address the notion that a leader's effectiveness is contextual. It
is embedded in the societal and organizational norms, values, and beliefs of the people being led.
A. GLOBE
B. WVS
C. IND
D. CVS
The GLOBE research established nine cultural dimensions: power distance, uncertainty avoidance,
humane orientation, institutional collectivism, in-group collectivism, assertiveness, gender
egalitarianism, future orientation, and performance orientation.
AACSB: Ethics
Blooms: Understand
78. The _____ refers to the extent to which a culture programs its citizens to accept delayed gratification
of their material, social, and emotional needs.
A. long-term versus short-term orientation dimension

B. indulgence versus restraint dimension
D. power distance dimension
The long-term versus short-term orientation dimension captures attitudes toward time, persistence,
ordering by status, protection of face, respect for tradition, and reciprocation of gifts and favors.
The label refers to these "values" being derived from Confucian teachings.
AACSB: Ethics
4-66
Education.
Blooms: Apply
79. Hofstede's dimension of Confucian dynamism:
A. captures attitudes toward time, persistence, ordering by status, protection of face, respect for
tradition, and reciprocation of gifts and favors.
B. focuses on how a society deals with the fact that people are unequal in physical and intellectual
capabilities.
C. explores the relationship between the individual and his/her fellows.
D. looks at the relationship between gender and the ability to accept ambiguous situations.
According to Hofstede, Confucian dynamism captures attitudes toward time, persistence, ordering
by status, protection of face, respect for tradition, and reciprocation of gifts and favors.

Blooms: Remember
Difficulty: 1 Easy
4-67
Education.
80. Which of the following is an example of ethnocentrism?
A. A manager in India looks down upon his subordinates because they are from a lower caste,
compared to him.
B. An upper-middle-class woman talks rudely to a sales person, because she looks down upon
individuals belonging to the working-class.
C. An American manager criticizes the cultural practices of Saudi Arabia, when he is sent there on
business, because it differs from his own cultural norms.
D. A French business owner, who plans to expand his market to China, conducts a detailed cultural
study of China to customize his marketing campaign.
Ethnocentrism is a belief in the superiority of one's own ethnic group or culture. Hand in hand with
ethnocentrism goes a disregard or contempt for the culture of other countries.

Blooms: Apply
81. For international businesses, the connection between culture and competitive advantage is
important because:
A. a weak connection is likely to encourage isolationism.

B. a weak connection is likely to encourage competition.
C. a strong connection is likely to produce the most viable competitors.
D. a strong connection is likely to hamper innovation.
For the international business, the connection between culture and competitive advantage is
important for two reasons. First, the connection suggests which countries are the likely to produce
the most viable competitors.

Blooms: Apply
4-68
Education.
82. What is ethnocentrism?
A. A belief in the superiority of one's business or organization over another.

B. A belief in the superiority of another group or culture over one's own group or culture.
C. A belief in the superiority of one's own ethnic group or culture.
D. A belief in the superiority of one's self over another person.
Ethnocentrism is a belief in the superiority of one's own ethnic group or culture. Hand in hand with
ethnocentrism goes a disregard or contempt for the culture of other countries.

Blooms: Remember
Difficulty: 1 Easy
83. Class-based conflict between workers and management in class-conscious societies can lead to:
A. increased costs of doing business.

B. decreased costs of doing business.
C. companies going out of business.
D. workers looking for new jobs in other businesses.
It can be argued that the class-based conflict between workers and management in class-conscious
societies, when it leads to industrial disruption, raises the costs of doing business in that society.

Blooms: Apply
4-69
Education.
84. Max Weber was a German sociologist who, in 1904, made the connection between _____ and "the
spirit of capitalism."
A. Protestant ethics
B. ethnocentrism
C. cross-cultural literacy
D. collectivism
Max Weber was a German sociologist who, in 1904, made the connection between Protestant ethics
and "the spirit of capitalism."

Blooms: Understand
Difficulty: 1 Easy
85. The concept of mobility between castes within an individual's lifetime:
A. is an opportunity to adopt positions of responsibility and influence in society.

B. makes no sense to traditional Hindus.
C. shows a figurative "reincarnation" of a person.
D. is a sign of spiritual progression to traditional Hindus.
Historically, Hinduism also supported India's caste system. The concept of mobility between castes
within an individual's lifetime makes no sense to traditional Hindus. Hindus see mobility between
castes as something that is achieved through spiritual progression and reincarnation. An individual
can be reborn into a higher caste in his or her next life if he or she achieves spiritual development
in this life.

Blooms: Understand
Difficulty: 1 Easy
4-70
Education.
86. According to _____, suffering originates in people's desires for pleasure.
A. Hinduism
B. Protestantism
C. Buddhism
D. Judaism
According to Buddhism, suffering originates in people's desires for pleasure. Cessation of suffering
can be achieved by following a path for transformation.

Blooms: Apply
87. Several studies have shown the economic advancement and _____ are important factors in societal
change.
A. individualism
B. collectivism
C. improved technology
D. globalization
Several studies have suggested that economic advancement and globalization may be important
factors in societal change. There is evidence that economic progress is accompanied by a shift in
values away from collectivism and toward individualism.

Blooms: Remember
Difficulty: 1 Easy
4-71
Education.
88. One reason for the shift in values away from collectivism and toward individualism may be:
A. that richer societies exhibit less need for social and material support structures built on
collectives.
B. individualism is a more important trait in a global society.
C. that richer societies exhibit more need for social and material support structures built on
collectives.
D. increased urbanization and improvements in the quality and availability of education are both a
function of economic progress.
One reason for the shift in values away from collectivism and toward individualism may be that
richer societies exhibit less need for social and material support structures built on collectives,
whether the collective is the extended family or the paternalistic company.

Blooms: Apply
89. _____ refers to a society that allows relatively free gratification of basic and natural human drives
related to enjoying life and having fun.
A. Persistence
B. Indulgence
C. Reciprocation
D. Restraint
Indulgence refers to a society that allows relatively free gratification of basic and natural human
drives related to enjoying life and having fun. Restraint refers to a society that suppresses
gratification of needs and regulates it by means of strict social norms.

Blooms: Remember
4-72
Education.
Difficulty: 1 Easy
90. Hofstede's _____ dimension measured the extent to which different cultures socialized their
members into accepting ambiguous situations and tolerating uncertainty.
A. power distance
B. long-term versus short-term orientation
D. indulgence versus restraint
socialized their members into accepting ambiguous situations and tolerating uncertainty.

Blooms: Remember
Difficulty: 1 Easy
4-73
Education.
91. Hofstede's masculinity versus femininity dimension looked at the relationship between gender and
work roles and found that in:
A. feminine cultures, sex roles were sharply differentiated, and traditional "feminine values"
B. feminine cultures, sex roles were less sharply distinguished, however, there was a great deal of
differentiation between men and women in the same job.
C. masculine cultures, sex roles were less sharply distinguished, and little differentiation was made
between men and women in the same job.
D. masculine cultures, sex roles were sharply differentiated, and traditional "masculine values"
Hofstede's masculinity versus femininity dimension looked at the relationship between gender and
work roles and found that in masculine cultures, sex roles were sharply differentiated, and
traditional "masculine values," such as achievement and the effective exercise of power, determined
cultural ideals. In feminine cultures, sex roles were less sharply distinguished, and little
differentiation was made between men and women in the same job.

Blooms: Apply
4-74
Education.
92. Hofstede's results, as might be expected, showed that nations such as _____ scored low on long-
term orientation.
A. the United States and Canada

B. Denmark and Sweden
C. Japan and Thailand
D. Great Britain and Mexico
Hofstede's results, as might be expected, showed that nations such as the United States and
Canada scored low on long-term orientation.

Blooms: Apply
93. The term _____ to refer to a group of people sharing a common set of values and norms.
A. mores
B. society
C. culture
D. folkway
The term society to refer to a group of people sharing a common set of values and norms. While a
society may be equivalent to a country, some countries harbor several societies or subcultures (i.e.,
they support multiple cultures), and some societies embrace more than one country (e.g., the
Scandinavian countries of Denmark, Norway, and Sweden are often viewed as culturally being a
part of one society in terms of the business marketplace).

Blooms: Remember
Difficulty: 1 Easy
4-75
Education.
94. _____ include such factors as indictments against theft, adultery, incest, and cannibalism.
A. Norms
B. Folkways
C. Mores
D. Values
Mores include such factors as indictments against theft, adultery, incest, and cannibalism.

Blooms: Understand
Difficulty: 1 Easy
95. A _____ is an association of two or more individuals who have a shared sense of identity and who
interact with each other in structured ways on the basis of a common set of expectations about
each other's behavior.
A. society
B. collective
C. social strata
D. group
A group is an association of two or more individuals who have a shared sense of identity and who
interact with each other in structured ways on the basis of a common set of expectations about
each other's behavior.

Blooms: Apply
4-76
Education.
Essay Questions
96. Compare and contrast folkways and mores.
Folkways are the routine conventions of everyday life. Generally, folkways are actions of little moral
significance. Folkways include rituals and symbolic behavior. In contrast, mores are norms that are
seen as central to the functioning of a society and to its social life. Mores have much greater
significance than folkways. Accordingly, violating mores can bring serious retribution.

Blooms: Analyze
Difficulty: 3 Hard
97. Discuss the relationship between society and the nation-state.
A society is a group of people that share a common set of values and norms, that is, people who
are bound together by a common culture. There is not a strict one-to-one correspondence
between a society and a nation-state. Nation-states are political creations that may contain a single
culture or several cultures. While it is possible to talk about cultures at different levels, for example,
an "American society," and "American culture," it is important to recognize there are several
societies within America, each with its own culture. The relationship between culture and country is
often ambiguous. Even if a country can be characterized as having a single homogenous culture,
often that national culture is a mosaic of subcultures.

Blooms: Analyze
Difficulty: 3 Hard
4-77
Education.
98. What are the determinants of culture?
The values and norms of a culture do not emerge fully formed. They are the evolutionary product
of political philosophy, economic philosophy, education, language, social structure, and religion.
The chain of causation runs both ways. While factors such as social structure and religion clearly
influence the values and norms of a society, the values and norms of a society can influence social
structure and religion.

Blooms: Understand
Difficulty: 3 Hard
99. Explain the concept of social stratification.
All societies are stratified on a hierarchical basis into social categories or social strata. Social strata
are typically defined on the basis of characteristics such as family background, occupation, and
income. Individuals born into the top of a social hierarchy tend to have better life chances than
individuals born into a lower stratum. While all societies are stratified to some degree they differ
from each other with regard to the degree of mobility between social strata and with regard to the
significance attached to social strata in business contexts.

Blooms: Understand
Difficulty: 3 Hard
4-78
Education.
100. Discuss why the stratification of a society is important to business.
The stratification of a society is significant if it affects the operation of business organizations. In a

country like Great Britain for example, the relative lack of class mobility and the differences between
classes has resulted in hostility between middle-class managers and their working-class employees.
An antagonistic relationship between management and labor classes, and the resulting lack of
cooperation and high level of industrial disruption, tends to raise the costs of production in
countries characterized by significant class divisions. In turn, this can make it more difficult for
companies based in such countries to establish a competitive advantage in the global economy.

Blooms: Apply
Difficulty: 3 Hard
101. What is the connection between religion and ethical systems? Do they have any implications for
business?
Ethical systems are a set of moral principles, or values, that are used to guide and shape behavior.
Most of the world's ethical systems are the product of religions. Therefore, there are Christian ethics
and Islamic ethics. There are four dominant religions in the world: Christianity, Islam, Hinduism, and
Buddhism. The relationship among religion, ethics, and society is subtle and complex. Some
scholars have argued that the most important business implications of religion center on the extent
to which different religions shape attitudes toward work and entrepreneurship and the degree to
which the religious ethics affect the costs of doing business in a country.
The authors point out that it is hazardous to make sweeping generalizations about the nature of
the relationship between religion and ethical systems and business practice. The proposed
relationships may exist, but their impact may be small compared to the impact of economic policy.

AACSB: Ethics
Blooms: Apply
Difficulty: 3 Hard
4-79
Education.
102. Explain how the Koran views business.
The Koran establishes some explicit economic principles, many of which are pro-free enterprise.
The Koran supports free enterprise and earning a legitimate profit through trade and commerce, as
well as the protection of the right to private property. However, Islam is critical of those who earn
profit through the exploitation of others. Islam stresses the importance of living up to contractual
obligations, of keeping one's word, and of abstaining from deception. One economic principle of
Islam prohibits the payment or receipt of interest, which is considered usury. This is not just a
matter of theology; in several Islamic states, it is also a matter of law.
AACSB: Ethics
Blooms: Understand
Difficulty: 3 Hard
103. Consider the influence of Confucian ethics on the economies of China, Japan, South Korea, and
Taiwan.
It has been suggested that the economic success of China, Japan, South Korea, and Taiwan, may be
due, in part, to the influence of Confucian ethics on the culture in those countries. Three values that
are central to the Confucian system of ethics are of particular note: loyalty, reciprocal obligations,
and honesty in dealing with others. The concept of reciprocal obligations is important. Confucian
ethics stress that superiors are obliged to reward the loyalty of their subordinates by bestowing
blessings on them. The notion of guanxi, or business relationships, which permeates business
dealings in the region, revolves around the three values. For example, it has been suggested that
the close ties between the automobile companies and their suppliers in Japan are facilitated by a
combination of trust and reciprocal obligations.
AACSB: Ethics
Blooms: Apply
4-80
Education.
Difficulty: 3 Hard
104. Consider the importance of unspoken language. Why is it important to be familiar with the
unspoken language of another culture?
Unspoken language refers to nonverbal communication. We all communicate with each other by a
host of nonverbal cues. The raising of eyebrows, for example, is a sign of recognition in most
cultures, while a smile is a sign of joy. Many nonverbal cues, however, are culturally bound. A failure
to understand the nonverbal cues of another culture can lead to a failure to communicate. For
example, making a circle with the thumb and forefinger is a friendly gesture in the United States,
but it is a vulgar gesture in Greece and Turkey. Personal space is another part of unspoken
language.
AACSB: Communication
AACSB: Diversity
Blooms: Understand
Difficulty: 3 Hard
Topic: How Language Affects Culture?
105. Why is the role of education in a culture important to international companies?
A key aspect of education in a culture is its role as a determinant of national competitive

advantage. The availability of a pool of skilled and educated workers seems to be a major
determinant of the likely economic success of a country. Porter for example, has argued that
Japan's excellent education system is an important factor explaining the country's postwar
economic success. In addition, a good education system is an important factor guiding the location
choices of international businesses. The general education level of a country is also a good index of
the kind of products that might sell in a country and of the type of promotional material that
should be used.
AACSB: Diversity
Blooms: Understand
4-81
Education.
Difficulty: 3 Hard
106. Describe the four dimensions of culture as identified by Geert Hofstede.
Geert Hofstede identified four dimensions that he claimed summarized the differences between
different cultures. According to Hofstede, the power distance dimension focused on how a society
deals with the fact that people are unequal in physical and intellectual capabilities. The second
dimension identified by Hofstede, individualism versus collectivism, focused on the relationship
between the individual and his/her fellows. Hofstede's third dimension, uncertainty avoidance,
measured the extent to which different cultures socialize their members into accepting ambiguous
situations and tolerating uncertainty. Finally, Hofstede's fourth dimension, masculinity versus
femininity, examined the relationship between gender and work roles.

Blooms: Understand
Difficulty: 3 Hard
107. Discuss the limitations of Hofstede's research.
Hofstede's research has been criticized on a number of points. First, Hofstede assumes there is a
one-to-one correspondence between culture and the nation-state. Second, the research may have
been culturally bound. Third, Hofstede's informants worked not only within a single industry, but
within one company. Finally, because cultures evolve, Hofstede's research, which was conducted in
the 1960s and 1970s, may not be as relevant today.

Blooms: Understand
Difficulty: 3 Hard
4-82
Education.
108. Discuss Confucian dynamism. Explore the debate over whether Confucian dynamism is good for an
economy.
The notion of Confucian dynamism, or long-term orientation, was added to Hofstede's model of
culture to capture attitudes toward time, persistence, ordering by status, protection of face, respect
for tradition, and reciprocation of gifts and favors. East Asian countries such as Japan, Hong Kong,
and Thailand scored high on Confucian dynamism, while countries such as the United States and
Canada scored low. Hofstede hypothesized that being Confucian was good for economic growth.
However, other experts have questioned this hypothesis, noting that countries that score low on
Confucian dynamism have also achieved high growth rates.

Blooms: Understand
Difficulty: 3 Hard
109. What are the implications of cultural differences for international businesses?
International business is different from national business because countries and societies are
different. Societies differ because their cultures vary. Three important implications for international
business flow from these differences. The first is the need to develop cross-cultural literacy. There is
a need not only to appreciate that cultural differences exist but also to appreciate what such
differences mean for international business. A second implication centers on the connection
between culture and national competitive advantage. A third implication looks at the connection
between culture and ethics in decision making.

Blooms: Apply
Difficulty: 3 Hard
4-83
Education.
110. Discuss the relationship between culture and national competitive advantage?
The value systems and norms of a country influence the costs of doing business in that country.
The costs of doing business in a country influence the ability of firms to establish a competitive
advantage in the global marketplace. It can be argued that the class-based conflict between
workers and management in class-conscious societies, when it leads to industrial disruption, raises
the costs of doing business in that society. Some sociologists have argued that the ascetic
"otherworldly" ethics of Hinduism may not be as supportive of capitalism as the ethics embedded
in Protestantism and Confucianism. Japan's emphasis on group affiliation, loyalty, reciprocal
obligations, honesty, and education, all boost the competitiveness of Japanese companies. But as
important as culture is, it is probably less important than economic, political, and legal systems in
explaining differential economic growth between nations.
AACSB: Ethics
Blooms: Apply
Difficulty: 3 Hard
4-84
Education.

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Chapter 04

True / False Questions

3. Folkways include rituals and symbolic behavior.

12. Like Christianity and Judaism, Islam is a polytheistic religion.

Multiple Choice Questions

26. Which of the following is true regarding culture?

A. Culture is not static.

A. culture; competitive advantage

29. Cross-cultural literacy refers to:

A. an individual's self-concept derived from perceived membership in a relevant social group.

32. Culture is ________.

36. Norms refer to:

40. _____ are the routine conventions of everyday life.

41. The term _____ also means culture.

45. Mores are:

A. Protestant work ethic

A. The values and norms of a society emerge fully formed.

48. A society's social structure refers to its:

A. system of values and norms.

49. The social organization of Western society tends to emphasize on:

A. Managers tend to develop good general skills as well as company-specific experience.

56. A caste system differs from a class system because:

59. Ethical systems are:

60. Religion may be defined as:

A. routine conventions of everyday life.

63. Hinduism and Buddhism both stress the importance of _____.

A. the caste system

65. Which of the following observations is correct?

A. it charges that business interest on the loan.

68. Hindus believe:

A. that there is but the one true omnipotent God.

A. does not support the caste system.

73. The individualism versus collectivism dimension of Hofstede's study explored:

A. World Values Survey

A. High power distance cultures

A. long-term versus short-term orientation dimension

79. Hofstede's dimension of Confucian dynamism:

80. Which of the following is an example of ethnocentrism?

A. a weak connection is likely to encourage isolationism.

82. What is ethnocentrism?

A. A belief in the superiority of one's business or organization over another.

A. increased costs of doing business.

A. is an opportunity to adopt positions of responsibility and influence in society.

86. According to _____, suffering originates in people's desires for pleasure.

A. the United States and Canada

96. Compare and contrast folkways and mores.

97. Discuss the relationship between society and the nation-state.

98. What are the determinants of culture?

100. Discuss why the stratification of a society is important to business.

106. Describe the four dimensions of culture as identified by Geert Hofstede.

107. Discuss the limitations of Hofstede's research.

True / False Questions

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Reflective Thinking

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Knowledge Application

12. Like Christianity and Judaism, Islam is a polytheistic religion.

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Knowledge Application