Countertrade is most attractive to:
A.small exporters.
B.large multinational enterprises.
C.only U.S. firms.
D.any firm in democratic nations.
E.new companies.
Answer:
Which of the following is true of a banking crisis?
A.It leads to individuals and companies withdrawing their deposits from banks.
B.It results in a sharp appreciation in the value of the currency.
C.It happens due to a decline in domestic borrowing.
D.It occurs due to asset price deflation.
E.It results in low government deficits.
Answer:
Which of the following is a distinct type of countertrade arrangement?
A.Merger
B.Arbitrage
C.Dirty float
D.Barter
E.Deregulation
Answer:
Which of the following approaches to ethics holds that an action is judged desirable if it
leads to the best possible balance of good consequences over bad consequences?
A.Ethnocentric
B.Utilitarian
C.Cultural relativist
D.Naive immoralist
E.Righteous moralist
Answer:
Which of the following is a recent trend among international businesses regarding
make-or-buy decisions?
A.Foreign facilities are considered nothing more than low-cost production facilities.
B.Research and design operations are restricted to home-country production facilities.
C.Manufacturing facilities are being based in each major national market.
D.Firms are avoiding time-based competition with each other.
E.Outsourcing decisions are expanding to embrace the production of service activities.
Answer:
While the lowering of trade barriers made globalization of markets and production a
theoretical possibility, which of the following has made it a tangible reality?
A.The advances in communication, information processing, and transportation
technologies
B.The rise of communism and the need for independent economies on a global scale
C.The increasing diversity in consumer tastes and preferences worldwide
D.The increasing differences in the material culture the world over
E.The decreasing significance of the World Trade Organization
Answer:
Which of the following services CANNOT be outsourced to foreign nations?
A.Debugging software
B.Handling consumer queries
C.Transcribing medical files
D.Interpreting MRI scans
E.Delivering closing arguments for a lawsuit
Answer:
Which of the following shows all of the different positions that a firm can adopt with
regard to value creation and low cost assuming that its internal operations are
configured adequately to support a particular position?
A.Demand-value model
B.Experience curve
C.Efficiency frontier
D.Optimal output model
E.Surplus curve
Answer:
How does a country that introduces a currency board make its commitment to
converting its domestic currency on demand into another currency at a fixed exchange
rate credible?
A.By borrowing funds from the International Monetary Fund and the World Bank
B.By maintaining a trade surplus with foreign countries
C.By holding foreign currency reserves equal at the fixed exchange rate to at least 100
percent of the domestic currency issued
D.By importing more goods from foreign countries than it exports
E.By printing foreign currencies
Answer:
In the context of strategic pricing, which of the following takes place whenever a firm
sells a product for a price that is less than the cost of producing it?
A.Inflation
B.Dumping
C.Arbitrage
D.Speculation
E.Outsourcing
Answer:
Which of the following are national accounts that track both payments to and receipts
from other countries?
A.Equity
B.Dematerialized
C.Balance of trade
D.Asset
E.Balance-of-payments
Answer:
Ryan is the executive general manager of a U.S. multinational and Veronica is a
manager in a similar position, but works for another U.S. company that operates only in
its home country. In this context, which of the following business functions will be most
typically exclusive to Ryan?
A.Marketing a product or service
B.Maintaining healthy relations with the U.S. government
C.Planning on a business strategy
D.Adhering to labor and environmental standards
E.Choosing an appropriate mode for entering a particular foreign country
Answer:
Due to the changing economic geography, many of tomorrow’s economic opportunities
are most likely to be found in the:
A. rich industrialized nations of the world like Great Britain and Germany.
B. centrally planned economies of the communist world.
C. United States.
D. developing nations of the world such as China, India, and Brazil.
E. countries that are currently not members of the World Trade Organization.
Answer:
Which of the following is a reason why a relatively poor country may be an attractive
target for inward investment?
A.Rapid economic growth
B.Political instability
C.Currency depreciation
D.High cost of living
E.Less developed infrastructure
Answer:
A composer can protect an original musical score from being copied and sold by
someone else by acquiring for the score a(n):
A.patent.
B.warrant.
C.trademark.
D.copyright.
E.affidavit.
Answer:
The primary purpose for which managers use a moral compass is to:
A.help them navigate through difficult ethical dilemmas.
B.maximize stockholders’ wealth.
C.legally justify their unethical behavior.
D.identify new markets that have the best growth potential.
E.establish political imperialism in host countries.
Answer:
Ceria Republic is a country that has achieved rapid economic growth and prosperity
over the last couple of decades as a result of globalization. Hence, the country is most
likely to see a cultural shift away from:
A.greater collectivism.
B.greater economic freedom.
C.well-being values.
D.secular rational values.
E.cultural convergence.
Answer:
Countries such as the United States, the United Kingdom, France, Germany, the
Netherlands, and Japan dominate in the share of total global stock of FDI and FDI
outflows and in rankings of the world’s largest multinationals because they:
A.were the most developed countries postwar and home to the largest and best
capitalized enterprises.
B.pursued a policy of blocking or restricting FDI inflow into their own economies.
C.provided subsidies for their domestic firms to protect them from foreign competition.
D.control much of the operating structure of the WTO which governs international
trade.
E.were the governing body of the International Monetary Fund.
Answer:
Six Sigma refers to a statistically based philosophy that aims to:
A.increase defects.
B.lower productivity.
C.increase the costs of value creation.
D.eliminate waste.
E.increase cost per unit.
Answer:
Which of the following is true of the Andean Pact during the mid-1980s?
A.Tariff-free trade existed between member countries.
B.Harmonization of economic policies between member countries had been achieved.
C.Successful integration of member economies had been achieved.
D.The Pact had failed to achieve the objective of a common external tariff.
E.The dominant political ideology in many of the Andean countries tended toward
democracy.
Answer:
Which of the following institutions within the U.S. Department of Commerce is
dedicated to providing businesses with intelligence and assistance for attacking foreign
markets?
A.The International Trade Administration
B.The Small Business Administration
C.The Federal Trade Commission
D.The Bureau of Competition
E.The Bank of New York
Answer:
Porter argues that a nation’s firms gain competitive advantage if their domestic
consumers are:
A.sophisticated and demanding.
B.price insensitive and trusting.
C.accommodating and flexible.
D.nationalistic and protective of their domestic industries.
E.biased toward foreign products.
Answer:
Which of the following is an argument against standardized advertising?
A.One large effort to develop a campaign fails to produce better results than 40 or 50
smaller efforts.
B.It fails to make use of local talent available in other cultures.
C.Advertising regulations may block implementation of standardized advertising.
D.Royalties make it the most expensive form of advertising.
E.It increases the costs of value creation.
Answer:
The United States has been an attractive target for FDI partly because of its:
A.abundance of cheap and skilled labor.
B.stable and dynamic economy.
C.commitment to environmental issues.
D.low corporate tax rates.
E.high trade barriers.
Answer:
According to Vernon, which of the following influences the movement of the locus of
global production from advanced countries to developing countries?
A.Cost considerations
B.Factor endowments
C.Domestic competition
D.Supporting industries
E.Firm structure
Answer:
Which of the following is true of counterpurchase?
A.It is the most restrictive countertrade arrangement.
B.It is a reciprocal buying agreement.
C.It is the simplest countertrade arrangement.
D.It uses a specialized third-party trading house.
E.It is the direct exchange of goods without a cash transaction.
Answer:
If a value creation activity of a firm can take place in Mexico most effectively, then that
activity of the firm must be based in Mexico. Firms that pursue such a strategy are most
likely to realize:
A.a position inside the efficiency frontier.
B.the experience curve.
C.economies of scale.
D.location economies.
E.demographic advantages.
Answer:
Which of the following is a feature of representative democracy?
A.Restrictions on an individual’s right to freedom of expression, opinion, and
organization
B.Inability of the citizens to vote out elected representatives who fail to perform their
job adequately at the next election
C.An unlimited term for elected representatives
D.A court system that is linked to the political system
E.A nonpolitical police force and armed service
Answer:
The risks of doing business are most likely to be the highest in a country that:
A.has low inflation rates.
B.supports high living standards.
C.has only one ethnic nationality.
D.protects intellectual property.
E.faces frequent changes in government and government policy.
Answer:
Which of the following groups would benefit the most from receiving subsidies?
A.Governments
B.International organizations such as the WTO
C.Domestic producers
D.Importers
E.Foreign competitors
Answer:
How does privatization help stimulate gains in economic efficiency?
A.It allows newly privatized firms to gain monopoly position in a particular industry.
B.It provides incentives to new private owners to search for increases in productivity
and to enter new markets.
C.It encourages state control over price and production output.
D.It raises barriers to direct investment by foreign enterprises.
E.It results in reservation of heavy industry for state ownership and the increase of
import tariffs.
Answer:
Which of the following best exemplifies an entrepreneur?
A.Sam, an employee at a supermarket, is solely responsible for all the purchases and
sales at the grocery department.
B.Joe recycles old household articles to build phones, radios, and other things for his
personal use.
C.Max makes his living by investing in small companies that have the potential to
grow.
D.Javier purchased an invention of his friend to start a company that processes plastic
bags into synthetic cloth.
E.Ryan invented an anti-aging formulation and sold it to a major pharmaceutical firm.
Answer:
What is the difference between folkways and mores?
A.Folkways are norms that are seen as central to the functioning of a society, whereas
mores are the routine conventions of everyday life.
B.Violating mores tends to bring more serious retribution than violating folkways.
C.Folkways exclude rituals and symbolic behaviors included in mores.
D.Folkways have much greater significance than mores.
E.Mores cannot be enacted into laws, whereas folkways can.
Answer:
Which of the following predicts that countries will export those goods that make
intensive use of factors that are locally abundant, while importing goods that make
intensive use of factors that are locally scarce?
A.Mercantilism
B.The theory of absolute advantage
C.The Heckscher-Ohlin theory
D.The theory of comparative advantage
E.Samuelson’s critique
Answer: