1) most governments are in favor of transfer pricing.
2) companies can strengthen the moral courage of employees by committing themselves
to retaliate against employees who exercise moral courage, say no to superiors, or
otherwise complain about unethical actions.
3) the four main differences between distribution systems are retail concentration,
channel length, channel exclusivity, and channel quality.
4) technical analysis draws on economic theory to construct sophisticated econometric
models for predicting exchange rate movements.
5) if a firm is serious about building an international cadre, it may have to pay its
international executives the same basic salary irrespective of their country of origin or
assignment.
6) in the united states, banks are the most important source of external capital for
business enterprises.
7) first-mover advantages are the advantages associated with entering a market early.
8) a firm’s organizational culture refers to the formal organizational structure of the
company, the control systems and incentives in place, and the human resources
component.
9) in today’s world of global communications, rapid transportation, and global markets,
cultural differences have ceased to exist.
10) the total accumulated value of foreign-owned assets at a given time is the inflow of
fdi.
11) which of the following is a drawback of the eurocurrency market?
a.high reserve ratio requirements
b.higher cost of transaction
c.lower interest rates on deposits
d.exposure to foreign exchange risk
12) free trade:
a.formed the basis for the mercantilist philosophy
b.is in direct contrast to the notion of the invisible hand as advocated by smith
c.refers to a situation where a government does not attempt to influence through quotas
or duties what its citizens can buy from another country
d.rejects the laissez-faire stance toward trade and maintains that it is not in the best
interests of a country
13) double taxation is:
a.charging double taxes in the home country
b.charging double taxes in the host country
c.taxation of income in both home and host country
d.paying income taxes at twice the normal rate
14) the _____ specifies that government agencies must give preference to american
products when putting contracts for equipment out to bid unless the foreign products
have a significant price advantage.
a.buy america act
b.anti-dumping act
c.helms-burton act
d.d’amato act
15) a danish firm raising capital in london must issue financial reports that serve the
needs of its british investors in addition to its danish financial reports. this is an
example of:
a.global financial analysis
b.multinational fiscal coverage
c.international capital documentation
d.transnational financial reporting
16) identify the incorrect statement pertaining to raymond vernon’s product life-cycle
theory.
a.early in their life cycle, most new products are produced in and exported from the
country in which they were developed
b.as a new product becomes widely accepted internationally, production starts in other
countries
c.a product in the early stage of the product life-cycle is imported by the country where
it was innovated
d.a product may ultimately be exported back to the country of its original innovation
17) the great virtue claimed for a pegged exchange rate is that it:
a.imposes monetary discipline on a country
b.leads to high inflation
c.leads to devaluation
d.increases fluctuations in exchange rates
18) it is best recommended that an international business adopt a financial structure:
a.that is consistent with host-country norms.
b.that is insensitive to the local monetary policy.
c.that minimizes the cost of capital.
d.that allows it to easily evaluate its return on equity relative to local competitors in the
same industry.
19) identify the incorrect statement regarding the former communist nations of europe
and asia
a.the economies of most of the former communist states are very strong and developed.
b.many of the former communist nations of europe and asia share a commitment to free
market economies
c.as a result of disturbing signs of growing unrest and totalitarian tendencies, the risks
involved in doing business in these countries is very high
d.for about half a century these countries were essentially closed to western
international business
20) identify the incorrect statement regarding ethical issues in international business.
a.they are often rooted in the fact that political systems, law, economic development,
and culture of nations vary significantly
b.human rights and environmental regulations are some of the common ethical issues
c.ethical practices of all nations are similar in nature
d.managers in multinational firms need to be particularly sensitive to differences in
business practices because they work across national borders
21) an agreement between countries in a geographic region to reduce tariff and nontariff
barriers to the free flow of goods, services, and factors of production between each
other is referred to as:
a.regional economic integration
b.socioeconomic integration
c.political integration
d.economic-political integration
22) all of the following are true of the export-import bank except:
a.it provides total coverage against political risks
b.it is an independent agency of the u.s. government
c.it is also known as eximbank
d.it has a direct lending operation
23) what are the three types of staffing policies in international business? briefly
describe each one. which is the most attractive approach and why?
24) you are the vice-president of human resources for your firm. your boss has asked
you to research the advantages and disadvantages of a polycentric approach to staffing.
what will you tell your boss?
25) what is mass customization?
26) compare and contrast a pegged exchange system and a dirty float system of
exchange rates.
27) what are the main uses of foreign exchange markets for international business?