1) emcs are experienced specialists who can help the neophyte exporter avoid common
pitfalls.
2) transaction exposure is the extent to which the income from individual transactions is
affected by fluctuations in foreign exchange values.
3) according to supporters of free trade, as countries get richer they enact tougher
environmental and labor regulations.
4) the world trade organization was created as part of the uruguay round.
5) one issue at the forefront of the current agenda of the wto is the increase in continued
high tariff rates on nonagricultural goods and services in many nations.
6) the infant industry argument is the latest argument for government intervention in
trade.
7) u.s. regulations tax u.s. shareholders on the firm’s overseas income when it is earned,
regardless of when the parent company in the united states receives it.
8) according to mendenhall and oddou, poorly-adjusted expatriates tend to be
nonjudgmental and nonevaluative in interpreting the behavior of host-country nationals.
9) economies of scale are unit cost reductions associated with a large-scale output.
10) when two parties agree to exchange currency and execute the deal at some specific
time in the future, a forward exchange occurs.
11) when an investor purchases _____, he purchases the right to receive a specified
fixed stream of income from the corporation for a specified number of years.
a.a corporate bond
b.a company share
c.eurocurrency bonds
d.equity holdings
12) which of the following refers to the legal rights over the use to which a resource is
put and over the use made of any income that may be derived from that resource?
a.theocratic right
b.property right
c.trade right
d.financial right
13) contrary to levitt’s suggestions, consumers in the most developed countries are
often:
a.willing to sacrifice their preferred attributes for lower prices
b.not willing to pay more for products that have additional features customized to their
tastes
c.not willing to sacrifice their preferred attributes for lower prices
d.willing to accept globally standardized products that have been developed with the
lowest common denominator in mind
14) according to the _____, in competitive markets free of transportation costs and
barriers to trade, identical products sold in different countries must sell for the same
price when their price is expressed in terms of the same currency.
a.law of one price
b.principle of consistent pricing
c.model of fair pricing
d.principle of equitable pricing
15) factors that determine the relative attractiveness of push and pull strategies include
all of the following except:
a.product type relative to consumer sophistication
b.channel length
c.noise levels
d.media availability
16) which of the following allows a multinational firm to reduce the transaction costs
that arise when many transactions occur between its subsidiaries?
a.unbundling
b.deferral principle
c.fronting loan
d.multilateral netting
17) the u.s. government using the threat of punitive trade sanctions to try to get the
chinese government to enforce its intellectual property laws is an example of
government intervention based on:
a.human rights protection
b.national security
c.consumer protection
d.retaliation
18) _____ occur(s) when more units of resources are required to produce each
additional unit.
a.economies of scale
b.diminishing returns to specialization
c.a positive-sum game
d.constant returns to specialization
19) according to the _____, the united states is a major player in the commercial jet
aircraft industry because american firms were first movers in the world market.
a.product life-cycle theory
b.theory of mercantilism
c.new trade theory
d.theory of absolute advantage
20) what is the main difference in the way international businesses approach
international labor relations?
a.the degree to which organized labor can limit the choices of an international business
b.the way work is organized within a plant
c.the degree to which labor relations activities are centralized or decentralized
d.the way staffing, management development, and compensation activities are
organized
21) the reduction in the average tariff rates on manufactured products since 1950
implies all of the following except that
a.firms are dispersing parts of their production process to global locations to drive down
production costs and increase product quality
b.the economies of the world’s nation states are becoming more intertwined
c.nations are becoming increasingly independent of each other for important goods and
services
d.the world has become significantly wealthier since 1950
22) in the classic global matrix structure, horizontal differentiation proceeds along two
dimensions. these dimensions are:
a.hierarchy and overall strategy
b.target returns and sales potential
c.marketing strategy and sales potential
d.product division and geographic area
23) a key challenge facing export and import financing is:
a.limited market opportunities
b.lack of export assistance
c.lack of qualified emcs
d.the lack of trust
24) many japanese firms prefer expatriate japanese managers to head their foreign
operations because these managers have been socialized into the firm’s culture while
employed in japan. this implies that:
a.the firm may believe that such managers cannot progress beyond senior positions in
their parent company
b.the firm may see an ethnocentric staffing policy as the best way to maintain a unified
corporate culture
c.the firm is trying to create value by transferring core competencies to a foreign
operation
d.the firm requires host-country nationals to be recruited to manage subsidiaries
25) the creation of a global web of value creation activities is the result of:
a.location economies
b.diseconomies of scale
c.shortage of skilled labor
d.informal trade barriers
26) the extent to which a firm’s future international earning power is affected by
changes in exchange rates is known as:
a.translation exposure
b.financial exposure
c.economic exposure
d.transaction exposure
27) which of the following is not provided by the department of commerce?
a.it provides the potential exporter with a “best prospects” list, which gives the names
and addresses of potential distributors in foreign markets
b.it has assembled a “comparison shopping service” for 14 countries that are major
markets for u.s. exports
c.it coordinates the export legal assistance network (elan), a nationwide group of
international trade attorneys who provide free initial consultations to small businesses
on export-related matters
d.it organizes trade events that help potential exporters make foreign contacts and
explore export opportunities
28) the _____ argues that forward exchange rates do the best possible job of forecasting
future spot rates and therefore investing in forecasting services would be a waste of
money.
a.inefficient market school
b.efficient market school
c.fisher effect
d.international fisher effect
29) the global trend toward the deregulation of financial markets has been facilitated by
all of the following developments, except:
a.the development of the eurocurrency market
b.pressure from financial services companies wanting to operate in a less regulated
environment
c.increasing rejection of the free market ideology associated with an individualistic
political philosophy
d.changes in the u.s. that allowed foreign banks to enter the u.s. capital market and
domestic banks to expand their operations overseas
30) which of the following statements about retail systems is true?
a.one factor contributing to greater retail concentration is an increase in car ownership
b.the number of households with refrigerators leads to lesser retail concentration in
developed countries
c.there is a tendency for greater retail concentration in many developing countries
d.retail systems are very fragmented in developed countries