03 Chap003

Chapter 03 - Differences in Culture
Chapter 03
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. Culture is static.
True False
3. Values are abstract ideas about what a group believes to be right, good, and desirable.
True False
4. A society is another name for a country.

True False
5. A country is defined as a system of values and norms that are shared among a group of
people and that when taken together constitute a design for living.
True False
6. People who violate folkways are considered to be evil or bad.

True False
7. Folkways include rituals and symbolic behavior.

True False
3-1
8. The bow that is given by a Japanese business executive to another business executive is an
example of symbolic behavior.
True False
9. Mores have much greater significance than folkways.

True False
10. If a country is characterized as having a single homogenous culture, then its national
culture also is homogenous and not a mosaic of subcultures.
True False
11. The values and norms of a culture are evolutionary.

True False
12. A society's social structure refers to its basic social organization.

True False
13. 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
14. The emphasis on individualism in the United States may raise the costs of doing business
due to its adverse impact on managerial stability and cooperation.
True False
15. The group is the primary unit of organization in Western societies.

True False
3-2
16. As demonstrated by Japan, the primacy of the group is always beneficial.

True False
17. The term social strata refers to the extent to which individuals can move out of the strata
into which they were born.
True False
18. The most rigid system of stratification is a class system.

True False
19. 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
20. 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
21. Historically, upward mobility could be achieved in a single generation in Britain.

True False
22. China's Communist rule strengthened class divisions.

True False
23. An antagonistic relationship between management and labor classes may result in higher
costs of production.
True False
3-3
24. Confucianism can be accurately characterized as a religion.

True False
25. Several sociologists have argued that of the three main branches of Christianity
Catholic, Orthodox, and Protestantthe latter has the most important economic implications.
True False
26. Muslim countries are likely to be receptive to international business as long as those
businesses behave in a manner that is consistent with Islamic ethics.
True False
27. The protection of the right to private property is embedded within Islam.
True False
28. A mudarabah contract banking method of Islamic banks is similar to a profit-sharing

scheme.
True False
29. Unlike Hinduism, Buddhism does not support the caste system.
True False
30. Guanxi is an important mechanism for building long-term business relationships and
getting business done in China.
True False
31. Since English is often thought of as the global language of business, it is not important for
an American business executive to learn foreign languages.
True False
3-4
32. Unspoken language refers to nonverbal communication.

True False
33. Hofstede's power distance dimension focused on how a society deals with the fact that
people are unequal in physical and intellectual capabilities.
True False
34. Members of high uncertainty avoidance cultures were characterized by a greater readiness
to take risks and less emotional resistance to change.
True False
35. There is a one-to-one correspondence between culture and the nation-state.

True False
36. Culture is a constant; it does not evolve over time.

True False
37. During the past decade, countries with high individualism and low Confucian dynamics
such as the United States have attained high growth rates.
True False
38. People who take food or safety for granted tend to be xenophobic, are wary of political
activity, have authoritarian tendencies, and believe that men make better political leaders than
women.
True False
3-5
39. American culture has changed and it is easier now for women to gain senior management
positions than men.
True False
40. Cultural change is unidirectional, with national cultures converging toward some
homogenous global entity.
True False
Multiple Choice Questions
41. During the 1960s and 1970s, class divisions in _____ raised the cost of doing business
there, relative to other European countries.
A. Great Britain
B. Switzerland
C. Norway
D. Germany
42. Which of the following is not true regarding culture?

A. Culture is static
B. Culture is evolving
C. It is a system of values and norms that are shared among a group of people
D. It involves the knowledge and beliefs of people
43. _____ is/are best defined as shared assumptions about how things ought to be.
A. Norms
B. Values
C. Society
D. Culture
3-6
44. 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.
45. Social rules and guidelines that prescribe appropriate behavior in particular situations are
best described as:
A. norms.
B. values.
C. culture.
D. society.
46. A group of people who share a common set of values and norms form a:
A. culture.
B. society.
C. country.
D. caste.
47. _____ are the routine conventions of everyday life.

A. Folkways
B. Mores
C. Rites
D. Beliefs
48. _____ 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
3-7
49. 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.
50. 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.
51. 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.
52. Which of the following statements about values and norms of a culture is not true?
A. The values and norms of a society do not emerge fully formed
B. They are the evolutionary product of a number of factors
C. They are influenced by religion
D. They do not influence social structure
53. The social organization of Western society tends to emphasize on:

A. a group orientation.
B. the family.
C. individual achievement.
D. work groups.
3-8
54. The emphasis on individualism in the United States results in all of the following
disadvantages except:
A. managers tend to develop good general skills but lack the company-specific experience.
B. difficulty in building teams within an organization to perform collective tasks.
C. executives are not exposed to different ways of doing business.
D. difficulty to achieve cooperation both within a company and between companies.
55. A central value of Japanese culture is the importance attached to:

A. the individual.
B. group membership.
D. personal accomplishments.
56. It has been argued that the success of Japanese enterprises in the global economy has been
based partly on all of the following except:
A. the diffusion of self-managing work teams.
B. the close cooperation among different functions within Japanese companies.
C. the high degree of managerial mobility between companies.
D. the cooperation between a company and its suppliers on issues such as design, quality
control, and inventory reduction.
57. 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
3-9
58. A _____ 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. culture system
59. This is a less rigid form of social stratification in which social mobility is possible.
A. Social system
B. Caste system
C. Cultural system
D. Class system
60. These strata are typically defined on the basis of characteristics such as family
background, occupation, and income.
A. Demographic strata
B. Economic strata
C. Social strata
D. Cultural strata
61. A class system:

A. is the same as a caste system.
B. is a rigid form of social stratification that does not permit social mobility.
C. allows an individual to change his/her position via personal achievements.
D. is more rigid than the caste system.
62. 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. economic classification.
B. social mobility.
C. class mobility.
D. class consciousness.
3-10
63. In China, class divisions:

A. have historically been of no importance.
B. were strengthened during the high point of Communist rule.
C. increased even during reforms of the late 1970s and early 1980s.
D. were weakened because of a rigid system of household registration.
64. The emergence of class consciousness in Great Britain can be attributed to:
A. the relative lack of class mobility.
B. a high degree of social mobility.
C. an extreme emphasis on individualism.
D. most of the population perceiving itself to be middle class.
65. 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 peoples' actions toward each other.
66. Religion may be defined as:

A. routine conventions of everyday life.
B. social rules that govern peoples' 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.
67. According to sociologists, which of the following branches of Christianity has the most
important economic implications?
A. Catholic
B. Orthodox
C. Protestant
D. Mormon
3-11
68. Which of the following observations is correct?

A. None of the economic principles established in the Koran are pro-free enterprise.
B. The Koran speaks approvingly of free enterprise.
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.
69. According to Islam, those who hold property are regarded as:
A. trustees.
B. owners.
C. tenants.
D. speculators.
70. This is an Islamic banking method where banks lend money to a business, and rather than
charging that business interest on the loan, they take a share in the profits that are derived
from the investment.
A. Mudarabah
B. Murabaha
C. Maysir
D. Mudarib
71. Which Islamic banking method is the most widely used among the world's Islamic banks,
primarily because it is the easiest to implement?
A. Mudarib
B. Murabaha
C. Maysir
D. Mudarabah
72. According to Max Weber:

A. principles embedded in Hinduism encourage high levels of entrepreneurial activity.
B. Hindu values emphasize that individuals should be judged by their material achievements.
C. pursuit of material well-being makes the attainment of nirvana easier.
D. devout Hindus would be less likely to engage in entrepreneurial activity than devout
Protestants.
3-12
73. Three values central to the Confucian system of ethics have very important economic
implications. Which of the following is not one among them?
A. Loyalty
B. Rule-based law
C. Reciprocal obligations
D. Honesty in dealings with others
74. Which of the following statements about the use of spoken language is false?
A. The nature of a language structures the way we perceive the world.
B. The language of a society can direct the attention of its members to certain features of the
world rather than others.
C. Countries with more than one language often have more than one culture.
D. Most people prefer to converse in English rather than their own language.
75. 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 vs. collectivism
C. uncertainty avoidance
D. masculinity vs. femininity
76. The individualism vs. 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.
3-13
77. Hofstede's uncertainty avoidance dimension considered:

capabilities.
D. the relationship between the individual and his or her fellows.
78. Hofstede's masculinity vs. femininity dimension examined:

capabilities.
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. The belief in the superiority of one's own culture is known as:
A. ethnocentrism.
B. egocentrism.
C. polycentrism.
D. theocentricism.
3-14

Essay Questions
81. Explain the role of values and norms in culture.
82. Compare and contrast folkways and mores.
83. Discuss the relationship between society and the nation-state.
84. What are the determinants of culture?
3-15
85. Discuss the effect of the emphasis on individual performance that exists in many Western
societies.
86. Explain the concept of social stratification.
87. What is the difference between a caste system and a class system?
88. Discuss why the stratification of a society is important to business.
3-16
89. What is the connection between religion and ethical systems?
90. Discuss the ideas of Max Weber. What is the Protestant work ethic? Why is it important to
the world economy?
91. Explain how the Koran views business.
92. What are the economic implications of Hinduism?
3-17
93. Consider the influence of Confucian ethics on the economies of China, Japan, South
Korea, and Taiwan.
94. Discuss the spoken language. Which is the most spoken language in the world? What
language is used in business? Is it important to learn a foreign language?
95. Consider the importance of unspoken language. Why is it important to be familiar with the
unspoken language of another culture?
96. Why is the role of education in a culture important to international companies?
3-18
97. Describe the four dimensions of culture as identified by Geert Hofstede.
98. Discuss the limitations of Hofstede's research.
99. Discuss Confucian dynamism. Explore the debate over whether Confucian dynamism is
good for an economy.
100. Economic advancement and globalization are prompting societal change. Discuss this
statement.
3-19
Chapter 03 Differences in Culture Answer Key
True / False Questions
1. (p. 88) In today's world of global communications, rapid transportation, and global markets,
cultural differences have ceased to exist.
FALSE
AACSB: Diversity Understanding

Bloom's: Knowledge
Difficulty: Medium
Learning Objective: 03-1
2. (p. 88) Culture is static.

FALSE

Bloom's: Knowledge
Difficulty: Medium
3. (p. 89) Values are abstract ideas about what a group believes to be right, good, and desirable.
TRUE

Bloom's: Knowledge
Difficulty: Easy
4. (p. 89) A society is another name for a country.

FALSE

Bloom's: Knowledge
Difficulty: Easy
3-20
5. (p. 89) A country is defined as a system of values and norms that are shared among a group of
people and that when taken together constitute a design for living.
FALSE

Bloom's: Knowledge
Difficulty: Easy
6. (p. 89) People who violate folkways are considered to be evil or bad.
FALSE

Bloom's: Comprehension
Difficulty: Medium
7. (p. 90) Folkways include rituals and symbolic behavior.

TRUE

Bloom's: Knowledge
Difficulty: Medium
8. (p. 90) The bow that is given by a Japanese business executive to another business executive
is an example of symbolic behavior.
TRUE

Bloom's: Application
Difficulty: Medium
3-21
9. (p. 90) Mores have much greater significance than folkways.

TRUE

Bloom's: Knowledge
Difficulty: Medium
10. (p. 91) If a country is characterized as having a single homogenous culture, then its national
culture also is homogenous and not a mosaic of subcultures.
FALSE

Difficulty: Medium
11. (p. 91) The values and norms of a culture are evolutionary.
TRUE

Bloom's: Knowledge
Difficulty: Medium
12. (p. 92) A society's social structure refers to its basic social organization.
TRUE

Bloom's: Knowledge
Difficulty: Easy
3-22
13. (p. 92) 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

Difficulty: Medium
14. (p. 93) The emphasis on individualism in the United States may raise the costs of doing
business due to its adverse impact on managerial stability and cooperation.
TRUE

Difficulty: Medium
15. (p. 93) The group is the primary unit of organization in Western societies.
FALSE

Bloom's: Knowledge
Difficulty: Medium
16. (p. 93) As demonstrated by Japan, the primacy of the group is always beneficial.
FALSE

Difficulty: Medium
3-23
17. (p. 94) The term social strata refers to the extent to which individuals can move out of the
strata into which they were born.
FALSE

Bloom's: Knowledge
Difficulty: Easy
18. (p. 94) The most rigid system of stratification is a class system.
FALSE

Bloom's: Knowledge
Difficulty: Easy
19. (p. 94) 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

Bloom's: Knowledge
Difficulty: Easy
20. (p. 94) 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

Bloom's: Knowledge
Difficulty: Easy
3-24
21. (p. 95) Historically, upward mobility could be achieved in a single generation in Britain.
FALSE

Bloom's: Knowledge
Difficulty: Medium
22. (p. 96) China's Communist rule strengthened class divisions.

TRUE

Bloom's: Knowledge
Difficulty: Medium
23. (p. 96) An antagonistic relationship between management and labor classes may result in
higher costs of production.
TRUE

Bloom's: Knowledge
Difficulty: Medium
24. (p. 97) Confucianism can be accurately characterized as a religion.

FALSE

Difficulty: Hard
3-25
25. (p. 97) Several sociologists have argued that of the three main branches of Christianity
Catholic, Orthodox, and Protestantthe latter has the most important economic implications.
TRUE

Bloom's: Knowledge
Difficulty: Medium
26. (p. 101) Muslim countries are likely to be receptive to international business as long as those
businesses behave in a manner that is consistent with Islamic ethics.
TRUE
AACSB: Ethics
Bloom's: Knowledge
Difficulty: Medium
27. (p. 101) The protection of the right to private property is embedded within Islam.
TRUE

Bloom's: Knowledge
Difficulty: Medium
28. (p. 103) A mudarabah contract banking method of Islamic banks is similar to a profit-sharing
scheme.
TRUE

Bloom's: Knowledge
Difficulty: Medium
3-26
29. (p. 104) Unlike Hinduism, Buddhism does not support the caste system.
TRUE

Bloom's: Knowledge
Difficulty: Easy
30. (p. 105) Guanxi is an important mechanism for building long-term business relationships and
getting business done in China.
TRUE

Bloom's: Knowledge
Difficulty: Medium
31. (p. 107) Since English is often thought of as the global language of business, it is not
important for an American business executive to learn foreign languages.
FALSE

Bloom's: Knowledge
Difficulty: Easy
32. (p. 108) Unspoken language refers to nonverbal communication.

TRUE

Bloom's: Knowledge
Difficulty: Easy
3-27
33. (p. 109) Hofstede's power distance dimension focused on how a society deals with the fact
that people are unequal in physical and intellectual capabilities.
TRUE

Bloom's: Knowledge
Difficulty: Easy
34. (p. 109) Members of high uncertainty avoidance cultures were characterized by a greater
readiness to take risks and less emotional resistance to change.
FALSE

Bloom's: Knowledge
Difficulty: Medium
35. (p. 111) There is a one-to-one correspondence between culture and the nation-state.
FALSE

Difficulty: Medium
36. (p. 111) Culture is a constant; it does not evolve over time.
FALSE

Bloom's: Knowledge
Difficulty: Medium
3-28
37. (p. 111) During the past decade, countries with high individualism and low Confucian
dynamics such as the United States have attained high growth rates.
TRUE

Bloom's: Knowledge
Difficulty: Medium
38. (p. 112) People who take food or safety for granted tend to be xenophobic, are wary of
political activity, have authoritarian tendencies, and believe that men make better political
leaders than women.
FALSE

Difficulty: Medium
39. (p. 112) American culture has changed and it is easier now for women to gain senior
management positions than men.
FALSE

Difficulty: Medium
40. (p. 113) Cultural change is unidirectional, with national cultures converging toward some
homogenous global entity.
FALSE

Bloom's: Knowledge
Difficulty: Medium
3-29

Multiple Choice Questions
41. (p. 88) During the 1960s and 1970s, class divisions in _____ raised the cost of doing
business there, relative to other European countries.
A. Great Britain
B. Switzerland
C. Norway
D. Germany
Class divisions led to a high level of industrial disputes in Great Britain during the 1960s and
1970s and raised the costs of doing business relative to the costs in countries such as
Switzerland, Norway, Germany, or Japan, where class conflict was historically less prevalent.

Bloom's: Knowledge
Difficulty: Hard
42. (p. 88) Which of the following is not true regarding culture?
A. Culture is static
B. Culture is evolving
C. It is a system of values and norms that are shared among a group of people
D. It involves the knowledge and beliefs of people
Culture is not static. It can and does evolve, although the rate at which culture can change is
the subject of some dispute.

Bloom's: Knowledge
Difficulty: Easy
3-30
43. (p. 89) _____ is/are best defined as shared assumptions about how things ought to be.
A. Norms
B. Values
C. Society
D. Culture
Values imply abstract ideas about what a group believes to be good, right, and desirable.

Bloom's: Knowledge
Difficulty: Easy
44. (p. 89) 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 ideas that constitute a design for living.

Bloom's: Knowledge
Difficulty: Easy
45. (p. 89) Social rules and guidelines that prescribe appropriate behavior in particular situations
are best described as:
A. norms.
B. values.
C. culture.
D. society.
Norms are the social rules that govern people's actions toward one another.

Bloom's: Knowledge
Difficulty: Easy
3-31
46. (p. 89) A group of people who share a common set of values and norms form a:
A. culture.
B. society.
C. country.
D. caste.
A society is defined as people who are bound together by a common culture.

Bloom's: Knowledge
Difficulty: Easy
47. (p. 89) _____ are the routine conventions of everyday life.
A. Folkways
B. Mores
C. Rites
D. Beliefs
Folkways define the way people are expected to behave.

Bloom's: Knowledge
Difficulty: Easy
48. (p. 89) _____ 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.

Bloom's: Knowledge
Difficulty: Medium
3-32
49. (p. 90) 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.

Difficulty: Medium
50. (p. 90) 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.

Difficulty: Medium
51. (p. 90) 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 its social life.
They have much greater significance than folkways.

Bloom's: Knowledge
Difficulty: Easy
3-33
52. (p. 91) Which of the following statements about values and norms of a culture is not true?
A. The values and norms of a society do not emerge fully formed
B. They are the evolutionary product of a number of factors
C. They are influenced by religion
D. They do not 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.

Difficulty: Hard
53. (p. 92) The social organization of Western society tends to emphasize on:
A. a group orientation.
B. the family.
D. work groups.
In many Western societies, the individual is the basic building block of social organization,
which is reflected not just in the political and economic organization of society but also in the
way people perceive themselves and relate to each other in social and business settings. The
value systems of many Western societies, for example, emphasize individual achievement.

Bloom's: Knowledge
Difficulty: Medium
3-34
54. (p. 92) The emphasis on individualism in the United States results in all of the following
disadvantages except:
A. managers tend to develop good general skills but lack the company-specific experience.
B. difficulty in building teams within an organization to perform collective tasks.
C. executives are not exposed to different ways of doing business.
D. difficulty 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.

Difficulty: Medium
55. (p. 93) A central value of Japanese culture is the importance attached to:
A. the individual.
B. group membership.
D. personal accomplishments.
One central value of Japanese culture is the importance attached to group membership. Strong
identification with the group is argued to create pressures for mutual self-help and collective
action.

Bloom's: Knowledge
Difficulty: Easy
3-35
56. (p. 93) It has been argued that the success of Japanese enterprises in the global economy has
been based partly on all of the following except:
A. the diffusion of self-managing work teams.
B. the close cooperation among different functions within Japanese companies.
C. the high degree of managerial mobility between companies.
D. the cooperation between a company and its suppliers on issues such as design, quality
control, and inventory reduction.
It has been argued that the success of Japanese enterprises in the global economy has been
based partly on their ability to achieve close cooperation between individuals within a
company and between companies. This has found expression in the widespread diffusion of
self-managing work teams within Japanese organizations, the close cooperation among
different functions within Japanese companies, and the cooperation between a company and
its suppliers.

Difficulty: Hard
57. (p. 94) 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.

Bloom's: Knowledge
Difficulty: Easy
3-36
58. (p. 94) A _____ 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. culture system
The most rigid system of stratification is a caste system. Often a caste position carries with it
a specific occupation.

Bloom's: Knowledge
Difficulty: Easy
59. (p. 94) This is a less rigid form of social stratification in which social mobility is possible.
A. Social system
B. Caste system
C. Cultural system
D. Class system
The class system is a form of open stratification in which the position a person has by birth
can be changed through his/her own achievements or luck.

Bloom's: Knowledge
Difficulty: Easy
3-37
60. (p. 94) These strata are typically defined on the basis of characteristics such as family
background, occupation, and income.
A. Demographic strata
B. Economic strata
C. Social strata
D. Cultural strata
All societies are stratified on a hierarchical basis into social categoriesthat is, into social
strata.

Bloom's: Knowledge
Difficulty: Medium
61. (p. 94) A class system:

A. is the same as a caste system.
B. is a rigid form of social stratification that does not permit social mobility.
C. allows an individual to change his/her position via personal achievements.
D. is more rigid than the caste system.
The class system is a form of open stratification in which the position a person has by birth
can be changed through his/her own achievements or luck.

Bloom's: Knowledge
Difficulty: Medium
3-38
62. (p. 96) 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. economic classification.
B. social mobility.
C. class mobility.
D. class consciousness.
The relative lack of class mobility and the differences between classes have resulted in the
emergence of class consciousness.

Bloom's: Knowledge
Difficulty: Medium
63. (p. 96) In China, class divisions:

A. have historically been of no importance.
B. were strengthened during the high point of Communist rule.
C. increased even during reforms of the late 1970s and early 1980s.
D. were weakened because of a rigid system of household registration.
Class division was strengthened during the high point of Communist rule because of a rigid
system of household registration that restricted most Chinese to the place of their birth for
their lifetime.

Bloom's: Knowledge
Difficulty: Hard
3-39
64. (p. 96) The emergence of class consciousness in Great Britain can be attributed to:
A. the relative lack of class mobility.
B. a high degree of social mobility.
C. an extreme emphasis on individualism.
D. most of the population perceiving itself to be middle class.
From a business perspective, the stratification of a society is significant if it affects the
operation of business organizations. In Great Britain, the relative lack of class mobility and
the differences between classes have resulted in the emergence of class consciousness. Class
consciousness has been played out in British society in the traditional hostility between uppermiddle-class managers and their working-class employees.

Difficulty: Medium
65. (p. 97) 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 peoples' actions toward each other.
Ethical systems refer to 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.
AACSB: Ethical Understanding/Reasoning Abilities

Bloom's: Knowledge
Difficulty: Easy
3-40
66. (p. 97) Religion may be defined as:

A. routine conventions of everyday life.
B. social rules that govern peoples' 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.

Bloom's: Knowledge
Difficulty: Easy
67. (p. 97) According to sociologists, which of the following branches of Christianity has the
most important economic implications?
A. Catholic
B. Orthodox
C. Protestant
D. Mormon
By breaking away from the hierarchical domination of religious and social life, Protestantism
gave individuals more freedom to develop their own relationship with God and this may have
paved the way for the emphasis on individual economic freedom and the development of
individualism as an economic philosophy.

Bloom's: Knowledge
Difficulty: Hard
3-41
68. (p. 101) Which of the following observations is correct?

A. None of the economic principles established in the Koran are pro-free enterprise.
B. The Koran speaks approvingly of free enterprise.
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.
The Koran establishes some explicit economic principles, many of which are pro-free
enterprise. The Koran speaks approvingly of free enterprise and of earning legitimate profit
through trade and commerce. The protection of the right to private property is also embedded
within Islam.

Bloom's: Knowledge
Difficulty: Medium
69. (p. 101) According to Islam, those who hold property are regarded as:
A. trustees.
B. owners.
C. tenants.
D. speculators.
Those who hold property are regarded as trustees rather than owners in the Western sense of
the word. As trustees they are entitled to receive profits from the property but are admonished
to use it in a righteous, socially beneficial, and prudent manner.

Bloom's: Knowledge
Difficulty: Medium
3-42
70. (p. 103) This is an Islamic banking method where banks lend money to a business, and rather
than charging that business interest on the loan, they take a share in the profits that are derived
from the investment.
A. Mudarabah
B. Murabaha
C. Maysir
D. Mudarib
A mudarabah contract is similar to a profit-sharing scheme.

Bloom's: Knowledge
Difficulty: Hard
71. (p. 103) Which Islamic banking method is the most widely used among the world's Islamic
banks, primarily because it is the easiest to implement?
A. Mudarib
B. Murabaha
C. Maysir
D. Mudarabah
In a murabaha contract, when a firm wishes to purchase something using a loanlet's say a
piece of equipment that costs $1,000the firm tells the bank after having negotiated the price
with the equipment manufacturer. The bank then buys the equipment for $1,000, and the
borrower buys it back from the bank at some later date for, say, $1,100, a price that includes a
$100 markup for the bank.

Bloom's: Knowledge
Difficulty: Hard
3-43
72. (p. 103) According to Max Weber:

A. principles embedded in Hinduism encourage high levels of entrepreneurial activity.
B. Hindu values emphasize that individuals should be judged by their material achievements.
C. pursuit of material well-being makes the attainment of nirvana easier.
D. devout Hindus would be less likely to engage in entrepreneurial activity than devout
Protestants.
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.
Traditional Hindu values emphasize that individuals should be judged not by their material
achievements but by their spiritual achievements. Hindus perceive the pursuit of material
well-being as making the attainment of nirvana more difficult.

Difficulty: Medium
73. (p. 105) Three values central to the Confucian system of ethics have very important
economic implications. Which of the following is not one among them?
A. Loyalty
B. Rule-based law
C. Reciprocal obligations
D. Honesty in dealings with others
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.

Bloom's: Knowledge
Difficulty: Medium
3-44
74. (p. 107) Which of the following statements about the use of spoken language is false?
A. The nature of a language structures the way we perceive the world.
B. The language of a society can direct the attention of its members to certain features of the
world rather than others.
C. Countries with more than one language often have more than one culture.
D. Most people prefer to converse in English rather than their own language.
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.

Difficulty: Medium
75. (p. 109) 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 vs. collectivism
C. uncertainty avoidance
D. masculinity vs. femininity
According to Hofstede, high power distance cultures were found in countries that let
inequalities grow over time into inequalities of power and wealth. Low power distance
cultures were found in societies that tried to play down such inequalities as much as possible.

Bloom's: Knowledge
Difficulty: Easy
3-45
76. (p. 109) The individualism vs. collectivism dimension of Hofstede's study explored:
capabilities.
D. the relationship between the individual and his/her fellows.
The individualism versus collectivism dimension focused on the relationship between the
individual and his/her fellows.

Bloom's: Knowledge
Difficulty: Easy
77. (p. 109) Hofstede's uncertainty avoidance dimension considered:

capabilities.
Hofstede's uncertainty avoidance dimension measured the extent to which different cultures
socialize their members into accepting ambiguous situations and tolerating uncertainty.

Bloom's: Knowledge
Difficulty: Easy
3-46
78. (p. 109) Hofstede's masculinity vs. femininity dimension examined:

capabilities.
Hofstede's masculinity versus femininity dimension looked at the relationship between gender
and work roles.

Bloom's: Knowledge
Difficulty: Easy
79. (p. 111) 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.

Bloom's: Knowledge
Difficulty: Easy
3-47
80. (p. 114) The belief in the superiority of one's own culture is known as:
A. ethnocentrism.
B. egocentrism.
C. polycentrism.
D. theocentricism.
An international business must be constantly on guard against the dangers of ethnocentric
behavior. Hand in hand with ethnocentrism goes a disregard or contempt for the culture of
other countries. Unfortunately, ethnocentrism is all too prevalent. Ugly as it is, ethnocentrism
is a fact of life, one that international businesses must be on guard against.

Bloom's: Knowledge
Difficulty: Easy
Essay Questions
81. (p. 89) Explain the role of values and norms in culture.
Values, or abstract ideas about what a group believes to be good, right, and desirable, form
the bedrock of culture. Norms are the social rules and guidelines that prescribe appropriate
behavior in a particular situation. Culture can be defined as a system of values and norms that
are shared among a group of people and that when taken together constitute a design for
living.

Bloom's: Knowledge
Difficulty: Easy
3-48
82. (p. 89-90) 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.

Bloom's: Knowledge
Difficulty: Medium
83. (p. 90-91) Discuss the relationship between society and the nation-state.
There is not a strict one-to-one correspondence between a society and a nation-state. Nationstates 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.

Difficulty: Medium
84. (p. 91) 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.

Bloom's: Knowledge
Difficulty: Easy
3-49
85. (p. 92-93) Discuss the effect of the emphasis on individual performance that exists in many
Western societies.
The emphasis on individual performance in many Western societies has both beneficial and
harmful aspects. For example, America's emphasis on individual performance has resulted in
a high level of entrepreneurial activity and the development of new products and new ways of
doing things. However, because individualism finds expression in a high degree of managerial
mobility between companies, the United States has many managers who have good general
skills but lack the knowledge, experience, and network contacts that come with years of
working in the same company. In addition, because individuals are always competing with
each other, it may be difficult to build teams within an organization to perform collective
tasks. In general, the emphasis on individualism in the United States, while helping to create a
dynamic entrepreneurial economy, may raise the costs of doing business due to its adverse
impact on managerial stability and cooperation.

Difficulty: Hard
86. (p. 94) 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.

Bloom's: Knowledge
Difficulty: Medium
3-50
87. (p. 94) What is the difference between a caste system and a class system?
A caste system 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. The caste system is the most rigid form of social stratification.
A caste frequently involves a specific occupation. In contrast, a class system is a less rigid
form of social stratification in which social mobility is possible through an individual's
personal achievements and/or luck.

Bloom's: Knowledge
Difficulty: Medium
88. (p. 96) 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. This hostility and the resulting lack of cooperation can make it
more difficult for firms to establish a competitive advantage in the global economy. While the
last two decades has seen a reduction in the number of industrial disputes in Britain, there are
signs that class consciousness may be reemerging in China.

Difficulty: Hard
3-51
89. (p. 97) What is the connection between religion and ethical systems?
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.
The authors make the point that while it is important to use caution when making
generalizations about the relationship between religion, ethics, and business, there is recent
research that suggests that strong religious beliefs have a positive impact on economic growth
rates.

Bloom's: Knowledge
Difficulty: Medium
90. (p. 98-99) Discuss the ideas of Max Weber. What is the Protestant work ethic? Why is it
important to the world economy?
Max Weber was a German sociologist who, in 1904, made the connection between Protestant
ethics and "the spirit of capitalism." According to Weber, there was a relationship between
Protestantism and the emergence of modern capitalism. Weber suggested that the Protestant
value system that emphasized the importance of hard work, wealth creation, and frugality was
needed to facilitate the development of capitalism.
Thus, Weber coined the term "Protestant work ethic" to denote the tendency on the part of
Protestants to work hard and accumulate wealth, which are the underpinnings of capitalism.

Bloom's: Knowledge
Difficulty: Medium
3-52
91. (p. 101) 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.

Bloom's: Knowledge
Difficulty: Medium
92. (p. 103-104) What are the economic implications of Hinduism?

According to Max Weber, Hindus do not encourage the kind of entrepreneurial activity in
pursuit of wealth creation that can be found in Protestantism. Weber notes that traditional
Hindu values emphasize that individuals should not be judged by their material achievements,
but by their spiritual achievements. But one must be careful not to read too much into Weber's
arguments. Modern India is a very dynamic entrepreneurial society, and millions of hardworking entrepreneurs form the economic backbone of the country's rapidly growing
economy.

Difficulty: Medium
3-53
93. (p. 105) 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. In fact, 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.

Difficulty: Medium
94. (p. 107) Discuss the spoken language. Which is the most spoken language in the world?
What language is used in business? Is it important to learn a foreign language?
Language does far more than just enable people to communicate with each other. The nature
of a language also structures the way we perceive the world. Chinese is the mother tongue of
the largest number of people in the world, followed by English and Hindi. However, the most
widely spoken language in the world is English, followed by French, Spanish and Chinese.
English is increasingly known as the language of international business. Therefore, even when
a business meeting does not involve native English speakers, English is likely to be spoken.
Learning a foreign language is still very important for native English speakers because doing
so can build rapport, and help a company avoid costly translation blunders.

Difficulty: Medium
3-54
95. (p. 108) 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.

Difficulty: Medium
96. (p. 108-109) 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.

Difficulty: Medium
3-55
97. (p. 109) 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 vs. 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 vs. femininity, examined the relationship between
gender and work roles.

Bloom's: Knowledge
Difficulty: Medium
98. (p. 111) 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.

Difficulty: Medium
3-56
99. (p. 111) 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.

Difficulty: Hard
100. (p. 112-113) Economic advancement and globalization are prompting societal change.
Discuss this statement.
Several studies have shown that economic advancement and globalization are important
factors in societal change. There is evidence that economic progress is accompanied by a shift
away from collectivism toward individualism. In Japan for example, the model Japanese
"salaryman" is disappearing as a new generation of office workers act more like Westerners.
Similarly, advancements in transportation and communications technologies combined with a
dramatic increase in trade and global corporations are creating conditions for the merging of
cultures.
The culture of societies may also change as they become richer because economic progress
affects a number of other factors, which in turn influence culture.

Difficulty: Hard
3-57

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Chapter 03 - Differences in Culture

1. In today's world of global communications, rapid transportation, and global markets,

4. A society is another name for a country.

6. People who violate folkways are considered to be evil or bad.

7. Folkways include rituals and symbolic behavior.

Chapter 03 - Differences in Culture

9. Mores have much greater significance than folkways.

11. The values and norms of a culture are evolutionary.

12. A society's social structure refers to its basic social organization.

15. The group is the primary unit of organization in Western societies.

Chapter 03 - Differences in Culture

16. As demonstrated by Japan, the primacy of the group is always beneficial.

18. The most rigid system of stratification is a class system.

21. Historically, upward mobility could be achieved in a single generation in Britain.

22. China's Communist rule strengthened class divisions.

Chapter 03 - Differences in Culture

24. Confucianism can be accurately characterized as a religion.

28. A mudarabah contract banking method of Islamic banks is similar to a profit-sharing

Chapter 03 - Differences in Culture

32. Unspoken language refers to nonverbal communication.

35. There is a one-to-one correspondence between culture and the nation-state.

36. Culture is a constant; it does not evolve over time.

Chapter 03 - Differences in Culture

Multiple Choice Questions

42. Which of the following is not true regarding culture?

Chapter 03 - Differences in Culture

47. _____ are the routine conventions of everyday life.

Chapter 03 - Differences in Culture

51. Mores are:

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

Chapter 03 - Differences in Culture

55. A central value of Japanese culture is the importance attached to:

Chapter 03 - Differences in Culture

61. A class system:

Chapter 03 - Differences in Culture

63. In China, class divisions:

65. Ethical systems are:

66. Religion may be defined as:

Chapter 03 - Differences in Culture

68. Which of the following observations is correct?

72. According to Max Weber:

Chapter 03 - Differences in Culture

76. The individualism vs. collectivism dimension of Hofstede's study explored:

Chapter 03 - Differences in Culture

77. Hofstede's uncertainty avoidance dimension considered:

78. Hofstede's masculinity vs. femininity dimension examined:

79. Hofstede's dimension of Confucian dynamism:

Chapter 03 - Differences in Culture

81. Explain the role of values and norms in culture.

82. Compare and contrast folkways and mores.

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

84. What are the determinants of culture?

Chapter 03 - Differences in Culture

86. Explain the concept of social stratification.

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

Chapter 03 - Differences in Culture

89. What is the connection between religion and ethical systems?

91. Explain how the Koran views business.

92. What are the economic implications of Hinduism?

Chapter 03 - Differences in Culture

96. Why is the role of education in a culture important to international companies?

Chapter 03 - Differences in Culture

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