________ is a political system in which political leaders rely on military and
bureaucratic power to support their rule.
A) Secular totalitarianism
B) Secular anarchism
C) Theocratic totalitarianism
D) Theocratic pluralism
The ________ was established in 2006 between the United States and Costa Rica, El
Salvador, Guatemala, Honduras, Nicaragua, and later the Dominican Republic.
A) NAFTA
B) LAFTA
C) CAFTA-DR
D) CAN
A common purpose of many companies’ facilities in foreign trade zones is ________.
A) final product assembly
B) acquisition of raw materials
C) product design
D) product manufacturing
A caste system is a system of social stratification in which ________.
A) a person’s social status is decided by his acquired wealth
B) a person’s position in society depends upon his educational qualifications and
achievements
C) people are born into a social ranking, with no opportunity for social mobility
D) people join highly exclusive associations that encourage external interaction
A system in which currencies float against one another, with governments intervening
to stabilize their currencies at particular target exchange rates is called a ________.
A) managed float system
B) linked exchange rate system
C) free float system
D) fixed exchange-rate system
The ________ view says that a company should maintain its home-country ethics
wherever it operates because the home-country’s view of ethics and responsibility is
superior to others’ views.
A) Friedman
B) righteous moralist
C) cultural relativist
D) utilitarian
Himark Enterprises has foreign operations in Taiwan, India, and China. The firm pays
an annual insurance premium to the Overseas Private Investment Corporation. The firm
is most likely protecting itself from ________.
A) privatization
B) natural disasters
C) nationalization
D) financial instability
Scenario: Jeans Unlimited
Jeans Unlimited produces clothing for young adults. It designs its clothes at its New
York headquarters and produces them at facilities located in two Southeast Asian
countries. The company recently received negative press after one of its facilities was
found using questionable labor practices, such as, employing children and operating in
a manner that damages the environment.
Jeans Unlimited manufactures its clothing at facilities located in two Southeast Asian
countries. The dispersal of manufacturing activities by the company indicates
________.
A) customization of products
B) niche marketing
C) globalization of markets
D) globalization of production
A strategy designed to reduce the scale or scope of a corporation’s business is called a
________ strategy.
A) growth
B) differentiation
C) retrenchment
D) stability
________ require that member countries concede a certain amount of their national
autonomy to the supranational union of which they are a part.
A) Free trade areas
B) Customs unions
C) Economic unions
D) Preferential trade areas
If Matt wants to estimate the extent to which free-market principles predominate in an
emerging market, Matt should consider the variable called ________.
A) economic freedom
B) commercial infrastructure
C) market receptivity
D) market intensity
Scenario: Excelsior’s Limited
Excelsior’s Limited, a manufacturer of health and beauty aids, is expanding its presence
in several countries around the world. Excelsior’s president is surprised at some of the
responses the company is receiving from other countries.
Excelsior’s Limited tried to sell its product in Canada, but was told that at least forty
percent of the product must be manufactured in Canada. This is an example of a(n)
________.
A) administrative delay
B) local content requirement
C) tariff
D) embargo
A product’s components are manufactured in a country that can produce them at a very
low cost while maintaining its quality. These components are then assembled in another
country where productivity in assembly is high. This process resembles the theory of
________.
A) comparative advantage
B) mercantilism
C) the international product life cycle
D) factor proportions
According to the ________ argument, as an industry grows and matures, it gains the
knowledge it needs to become more innovative, efficient, and competitive.
A) maturing industry
B) infant industry
C) standardized product
D) developing economy
Which of the following would be most appropriate for its consumer product line?
A) horizontal integration
B) vertical integration
C) push strategy
D) pull strategy
The process of screening and hiring the best-qualified applicants with the greatest
performance potential is called ________.
A) performance appraisal
B) orientation
C) recruitment
D) selection
________ political systems include democracies, constitutional monarchies, and some
aristocracies.
A) Totalitarian
B) Anarchist
C) Fascist
D) Pluralistic
Which of the following statements is true regarding location economies?
A) The demand and supply factors heavily influence the productivity of a location.
B) They apply only to service providers.
C) Each production activity generates more value in a particular location than
elsewhere.
D) They are restricted to business activities that involve product manufacturing.