1) if the net present value of the discounted cash flows is slightly less than zero, the
firm should go ahead with the project.
2) the letter of credit system effectively transfers the issue of trust to the bank.
3) profit growth is measured by the percentage increase in net profits over time.
4) the marketing mix is comprised of product attributes, distribution strategy,
communication strategy, and pricing strategy.
5) the helms-burton act of 1996 was aimed at foreign companies that were undermining
u.s. trade sanctions against libya and iran.
6) because of their nature, service activities cannot be outsourced to other companies.
7) by using the global capital market, firms can often borrow funds at a lower cost than
is possible in a purely domestic capital market.
8) according to the theories of smith, ricardo, and heckscher-ohlin, if a country can
produce a product by itself, it should not import that product.
9) the problem of blocked earnings is much more serious than it was previously.
10) outsourcing is a process that is limited to manufacturing enterprises.
11) price inflation occurs when the quantity of money in circulation rises faster than the
stock of goods and services.
12) a small-scale entrant is more likely than a large-scale entrant to capture first-mover
advantages associated with demand preemption, scale economies, and switching costs.
13) when firms in the consumer goods industry are trying to sell to a large segment of
the market they favor a:
a.push strategy
b.pull strategy
c.standardized strategy
d.localized strategy
14) which of the following is a nationwide group of international trade attorneys who
provide free initial consultations to small businesses on export-related matters?
a.emc
b.sba
c.elan
d.score
15) the rise in fdi in the services sector is a result of all of the following except:
a.the general move in many developed countries away from manufacturing and toward
services
b.accelerating regulations of services
c.many services cannot be traded internationally
d.many countries have liberalized their regimes governing fdi in services
16) a company that wants to reduce set-up time for complex equipment, increase the
utilization of individual machines through better scheduling, and improve quality
control at all stages of the manufacturing process should adopt:
a.standardization
b.diseconomies of scale
c.flexible machine technology
d.minimum efficient scale
17) _____ is also known as the market imperfections theory.
a.internationalization theory
b.internalization theory
c.perfect markets theory
d.small markets theory
18) global learning based on the multidirectional transfer of skills between subsidiaries
and the corporate center is a central feature of a firm pursuing a(n) _____ strategy.
a.localization
b.global standardization
c.transnational
d.international
19) this act allows americans to sue foreign firms that use property in cuba confiscated
from them after the 1959 revolution.
a.the buy america act
b.the anti-dumping act
c.the helms-burton act
d.the d’amato act
20) which of the following is a drawback associated with a jit system?
a.there are high transportation costs involved
b.it leaves a firm without a buffer stock of inventory
c.it leaves a firm with scrap costs associated with defective products
d.it increases the warranty costs
21) if general electric, a u.s. based corporation, purchased a 50 percent interest in a
company in italy, that purchase would be an example of a(n):
a.minority acquisition
b.outright stake
c.majority acquisition
d.greenfield investment
22) which of the following statements about six sigma is true?
a.it is a statistically based philosophy
b.it is easily possible for a company to achieve six sigma perfection
c.at six sigma, a production process will have 66 defects per million units
d.at six sigma, a production process would be 100 percent accurate
23) many firms find it advantageous to organize as a set of separate legal entities or
subsidiaries because of all of the following reasons except:
a.it limits their total legal liability
b.to take advantage of corporate tax regulations
c.of legal requirements in the countries in which they do business
d.subsidiaries are all separate economic entities
24) identify the incorrect statement regarding political risk.
a.it can be defined it as the likelihood that political forces will cause drastic changes in
a country’s business environment that hurt the profit and other goals of a business.
b.it tends to be greater in countries where the underlying nature of the society makes the
likelihood of social unrest high.
c.when political risk is high, there is a high probability that a change will occur in the
country’s political environment that will endanger foreign firms there.
d.in most cases, political change may result in the expropriation of foreign firms’ assets.
25) a banking crisis:
a.is a situation in which consumer spending patterns significantly affect a country’s
balance of payments, thereby affecting its currency
b.is a situation in which a country cannot service its debt obligations
c.refers to a loss of confidence in the banking system that leads to a run on banks, as
individuals withdraw their deposits
d.occurs when a speculative attack on the exchange value of a currency results in a
sharp depreciation in the value of the currency
26) the eu’s common agricultural policy is an example of a tax policy designed to
benefit:
a.consumers
b.taxpayers
c.special-interest politics
d.free trade in developed countries
27) at six sigma, a production process would be 99.99966 percent accurate, creating just
_____.
a.3.4 defects per hundred thousand units
b.3.4 defects per million units
c.34 defects per million units
d.6.8 defects per million units
28) external stakeholders:
a.are individuals or groups who own the business
b.include all employees, the board of directors, and stockholders
c.typically comprise customers, suppliers, lenders, etc
d.are individuals or groups who work for the business