30) What is true of reactive firms?
A) Reactive firms consider a variety of markets for selling their products and services.
B) They consider exporting only after their domestic market is saturated.
C) They systematically scan foreign markets for profitable export opportunities.
D) They create excess productive capacity and actively hunt for opportunities in foreign markets.
31) What is a reason that firms take a reactive approach to exporting rather than a proactive
approach?
A) Most firms are familiar with the foreign market opportunities and therefore do not need to
utilize proactive approaches.
B) They are intimidated by the complexities and mechanics of exporting to countries where
business practices, language, culture, legal systems, and currency are very different from the home
market.
C) Most firms already know where the market potential and opportunities are and they do not need
to be proactive.
D) They are not intimidated by the complexities and mechanics of exporting to foreign countries
and can, therefore, use the same reactive approaches that work in their home market.
32) What is a common difficulty that traders face when exporting goods or services to other
countries?
A) Small firms tend to be more aggressive than larger firms in global trade.
B) Governments do not provide much assistance to exporters.
C) Growth opportunities are often limited in global markets.
D) Exporters often face voluminous paperwork and complex formalities.
33) ________ can help new exporters identify opportunities and avoid common pitfalls.
A) An MITI
B) An export-import bank
C) An in-house trading department
D) An export management company
34) ________ are export specialists that offer a full menu of services to handle all aspects of
exporting, similar to having an internal exporting department within your own firm.
A) Small business development centers (SBDCs)
B) Centers for international business education and research (CIBERs)
C) Export legal assistance networks (ELANs)
D) Export management companies (EMCs)
35) Which of the following statements is true of export management companies (EMCs)?
A) An EMC is a transportation company that engages in international business.
B) EMCs are export-import banks that manage foreign exchanges.
C) EMCs are export specialists that act on behalf of their client firms.
D) An EMC is an intermediary that facilitates talks between two nations.
36) Japan’s ________ have offices all over the world, and they proactively, continuously seek
export opportunities for their affiliated companies large and small.
A) sogo shosha
B) kaizen
C) MITI
D) Samurai
37) In the ________ program organized by the U.S. Department of Commerce, department
representatives accompany groups of U.S. businesspeople abroad to meet with qualified agents,
distributors, and customers.
A) best prospects
B) SCORE
C) capital assistance
D) matchmaker
38) Which of the following statements is true about the Small Business Administration (SBA)?
A) It is the most comprehensive source of export opportunities information.
B) The SBA is a private organization managed by leaders of large corporations.
C) The SBA employs trade officers throughout the United States.
D) The SBA offers help exclusively to small businesses that sell products within the United States.
39) Which of the following is a nationwide group of international trade attorneys who provide free
initial consultations to miniature businesses on export-related matters?
A) ELAN
B) EMC
C) MITI
D) SCORE
40) Through its ________ program, the SBA oversees about 11,500 volunteers with international
trade experience to provide one-on-one counseling to active and new-to-export businesses.
A) matchmaker
B) SCORE
C) ELAN
D) trade fair
41) Japan’s great trading houses are called
A) Nikei.
B) sogo shosha.
C) Yen houses.
D) Samurai houses.
42) In theory, the advantage of export management companies is that they are
A) managed by governments that provide export subsidies.
B) not-for-profit organizations that provide free service.
C) subsidized by the Department of Commerce.
D) experienced specialists who can help the neophyte exporter.
43) Which of the following is a successful exporting strategy used by 3M?
A) Add additional products once exporting becomes successful.
B) Enter many markets at one time to gain maximum exposure.
C) Bring in expert marketing specialists to promote the firm’s products.
D) Enter on a large scale to flood the market.
44) In a letter of credit transaction, the importer secures the letter of credit
A) before product shipment.
B) after product shipment.
C) from the exporter’s bank.
D) after receiving the product.
45) The exporter endorses the ________ so title to the goods is transferred to the bank.
A) bill of lading
B) letter of credit
C) draft
D) promissory note
46) A ________ states that the bank will pay a specified sum of money to a beneficiary, normally
the exporter, on presentation of particular, specified documents.
A) bill of exchange
B) bill of lading
C) letter of credit
D) bank statement
47) Bank charges on letters of credit will depend on the
A) Exporter’s creditworthiness.
B) size of the transaction.
C) Exporter‘s means of finance.
D) time taken to approve the sale.
48) A draft used in international transactions
A) is a document requesting payment.
B) explains the conditions of a contract.
C) is the same as a letter of credit.
D) gives a bank guarantee to an exporter.
49) In an international transaction involving a bank as a third party, the exporter ships the product
after
A) the bank receives materials from the importer.
B) receiving a cleared payment through the bank.
C) the importer has paid the bank.
D) the bank promises to pay on the importer’s behalf.