1) when a tourist changes one currency into another, the tourist is participating in the
foreign exchange market.
2) firms pursuing a global standardization strategy are more centralized than enterprises
pursuing a localization or international strategy.
3) high levels of corruption significantly reduce the foreign direct investment, level of
international trade, and economic growth rate in a country.
4) similarities in the accounting systems of countries are sometimes due to the
countries’ close political and/or economic ties.
5) according to hofstede, countries such as britain, the united states and sweden are
characterized by high uncertainty avoidance.
6) a firm that establishes a _____ must bear the full costs and risks of entering a foreign
market.
a.licensing agreement
b.wholly owned subsidiary
c.franchise
d.joint venture
7) a _____ allows an entity to reduce the taxes paid to the home government by the
amount of taxes paid to the foreign government.
a.tax treaty
b.tax credit
c.deferral principle
d.tax benefit
8) which of the following is not an advantage of strategic alliances?
a.it allows firms to share the fixed costs of developing new products or processes
b.it is a way to bring together complementary skills and assets that neither company
could easily develop on its own
c.it will help the firm establish technological standards for the industry that will benefit
the firm
d.it gives a firm tight control over operations in different countries
9) according to hofstede, which of the following countries is characterized by low
uncertainty avoidance?
a.greece
b.sweden
c.japan
d.mexico
10) the major costs saving associated with jit comes from:
a.speeding up inventory turnover
b.having materials arrive at a manufacturing plant before they are needed
c.avoiding production slowdowns by ensuring inventory is stockpiled
d.using warehouse space to maintain on-hand inventory
11) a turnkey strategy:
a.is always riskier than conventional fdi
b.is never used in a country with unstable political and economic environments
c.is useful where fdi is limited by host-government regulations
d.is a strong indicator of a firm’s long-term interest in a foreign country
12) a consumer surplus can be best described as:
a.what the consumer has “left-over” after a purchase
b.how much extra a consumer has to pay for a product
c.value for the money
d.the premium charged for a quality product
13) if four firms control 80 percent of a domestic market, then _____ exists.
a.an oligopoly
b.a monopoly
c.an oligarchy
d.vertical integration
14) under the bretton woods, all countries fixed the value of their currency in terms of:
a.the british pound
b.the euro
c.the u.s. dollar
d.gold
15) in terms of international comparisons, which of the following statement is false?
a.japanese firms can draw on the large reservoirs of experience of its export-oriented
institutions
b.the united states has been a relatively self-contained continental economy until
recently
c.many german firms are relatively blind when they seek export opportunities
d.japan has long made its living as a trading nation
16) consumers in highly developed countries value _____ as compared to their
counterparts in less developed nations.
a.price
b.product reliability
c.product attributes
d.standardized products
17) what is the total cumulative value of foreign investments best referred to as?
a.accumulation of foreign shares
b.portfolio investments
c.stock of foreign direct investments
d.stock market investments
18) the emergence of class consciousness in great britain can be attributed to:
a.the relative lack of class mobility
b.a high degree of social mobility
c.an extreme emphasis on individualism
d.most of the population perceiving itself to be middle class
19) which of the following statements is true regarding assessing the performance of a
foreign subsidiary and its managers?
a.it is inappropriate to compare subsidiaries against each other on the basis of return on
investment (roi)
b.foreign subsidiaries operate in widely similar economic, political, and social
conditions
c.managers should be evaluated in local currency terms after making allowances for
items over which they have no control
d.the evaluation of a subsidiary should be combined with the evaluation of its manager
20) identify the country where historically the national government has been a more
important provider of capital, which has influenced accounting practices.
a.united states
b.france
c.germany
d.switzerland
21) discuss the notion of moral hazard. what is the relationship between moral hazard
and the imf?
22) why is the role of education in a culture important to international companies?
23) innovations in transportation have had a major impact on global trade. consider one
of these innovations: containerization. why is this innovation so significant?
24) falling barriers to international trade destroy manufacturing jobs in wealthy
advanced economies. discuss this statement. do you agree? why or why not?
25) explain how a company competes using outsourcing. provide an example.
26) what is a core competence? why is it essential to the success of the firm?
27) discuss the relationship between society and the nation-state.