1) moore’s law predicts that the power of microprocessor technology doubles and its
cost of production falls by half every 18 months.
2) a source of concern of critics of free trade is that it usually encourages firms from
advanced countries to move manufacturing facilities to less developed countries that
lack adequate regulations to protect labor and the environment from abuse.
3) the rate at which one currency is converted into another is known as the fluctuation
rate.
4) bureaucratic rules designed to make it difficult for imports to enter a country are
local content requirements.
5) transactions among the members of a corporate family are not included in
consolidated financial statements.
6) a just distribution is one that is considered fair and equitable.
7) this theory explains the observed patterns of international trade by emphasizing the
interplay between the proportions in which the factors of production are available in
different countries and the proportions in which they are needed for producing
particular goods.
a.mercantilism
b.absolute advantage
c.heckscher-ohlin
d.comparative advantage
8) in the united states, _____ are the major source of external capital.
a.individual investors
b.banks
c.government
d.retained earnings
9) which of the following methods translates assets valued in a foreign currency into the
home-country currency using the exchange rate that exists when the assets are
purchased?
a.temporal method
b.current rate method
c.operating cost accounting method
d.historic cost principle
10) the utilitarian approach to business ethics suggests that:
a.people should be treated as ends and never purely as means to the ends of others
b.the moral worth of actions or practices is determined by their consequences
c.people have dignity and need to be treated as such
d.human beings have fundamental rights and privileges that transcend national cultures
11) the cost of capital:
a.is the price of borrowing money, which is the rate of return that borrowers must pay
investors
b.tends to be higher in an international capital market than it is in a purely domestic
market
c.in a purely domestic market implies that borrowers must pay less to persuade
investors to lend them their money
d.in an international market implies that borrowers will be able to pay more to persuade
investors to lend them their money
12) this refers to a political system in which government is by the people, exercised
either directly or through elected representatives.
a.totalitarianism
b.authoritarianism
c.democracy
d.dictatorship
13) which of the following is a problem that limits a firm’s ability to pursue a geocentric
policy?
a.the lack of management transfers from home to host countries, and vice versa, can
lead to a lack of integration between corporate headquarters and foreign subsidiaries
b.the higher pay managers on an international fast track enjoy may be a source of
resentment within a firm
c.the firm fails to understand host-country cultural differences that require different
approaches to marketing and management
d.it limits advancement opportunities for host-country nationals
14) which of the following statements regarding barriers to cross-border capital flows is
not true?
a.they limit the ability of capital to roam the world freely in search of the highest
risk-adjusted return
b.they can lead to too much capital being invested in some markets and too little in
others, at any one time
c.they are no longer responsible for the relatively low correlation between the
movements of stock markets in different countries
d.they include limits on the amount of a firm’s stock that a foreigner can own and limits
on the ability of a country’s citizens to invest their money outside that country
15) the continuing persistence of _____ differences between nations acts as a major
brake on any trend toward global consumer tastes and preferences.
a.technological and industrial
b.institutional and political
c.cultural and economic
d.gnp level and growth rate
16) which of the following statements about the sba is false?
a.it is the most comprehensive source of export opportunities information
b.it employs 10 regional international trade officers throughout the united states
c.it employs a 10-person international trade staff in washington, d.c
d.it oversees some 850 volunteers to provide one-on-one counseling to active and
new-to-export businesses
17) a polycentric approach may be effective for firms pursuing a(n):
a.international strategy
b.localization strategy
c.transnational strategy
d.global standardization strategy
18) unions’ bargaining power is derived largely from their:
a.ability to threaten to disrupt production
b.ability to change the organizational culture
c.willingness to adapt to new employment practices
d.ability to show restraint in negotiations
19) the use of the forward market and swaps to protect against foreign exchange risk
has increased markedly since:
a.the breakdown of the gold standard
b.the collapse of the bretton woods system in 1973
c.the end of the plaza accord
d.the louvre accord ended in 1968
20) the implied lack of coordination between domestic operations and foreign
operations, which are isolated from each other in separate parts of the structural
hierarchy, is a problem encountered with a(n):
a.global matrix structure
b.international division structure
c.worldwide product division structure
d.worldwide area structure
21) what is the principle tool used by most managers to increase the reliability of their
product offering?
22) explain how mercosur has changed over time. what are the implications of these
changes?
23) what are the four main differences between distribution systems across countries?
24) what are the three main types of legal systems in use around the world?
25) explain why a firm would choose a global standardization strategy.
26) should a firm pay executives in different countries according to the prevailing
standards in each country, or should it equalize pay on a global basis?
27) what was the gold standard? who participated in the system? what was the major
advantage of the system?
28) why did the bretton woods system fail?