1) an oligopoly is an industry composed of a limited number of large firms.
2) a decentralized organization allows managers to respond to environmental changes
more quickly than in a centralized organization.
3) high relative price inflation, a widening current account deficit, excessive expansion
of domestic borrowing, and asset price inflation are all underlying causes of banking or
foreign debt crises.
4) unlike other trade policies, local content regulations tend to benefit consumers and
not producers.
5) in the united states, government regulations require firms to publish detailed
information about their training and employment policies.
6) the simplest integrating mechanism in an mne is direct contact between managers.
7) ethical dilemmas are situations in which none of the available alternatives seems
ethically acceptable.
8) a society is another name for a country.
9) the international fisher effect states that for any two countries, the spot exchange rate
should change in an equal amount but in the opposite direction to the difference in
nominal interest rates for the two countries.
10) the wto has the ability to force any member nation to take an action to which it is
opposed.
11) noblesse oblige refers to payments that ensure receiving the standard treatment that
a business ought to receive from a foreign government.
12) speculative buying and selling of currencies can create very volatile movements in
exchange rates.
13) base pay in most firms is set with regard to global market conditions.
14) underlying the trend towards greater globalization is technological change and a
decline in barriers to the free flow of goods, services, and capital.
15) to exploit the opportunities presented by the eu, non-eu firms must establish eu
subsidiaries.
16) any advantage, such as a trademark or brand name that enables a firm to earn higher
profits than its competitors is best known as a firm’s:
a.operating advantage
b.proprietary advantage
c.core competency
d.goodwill
17) in a letter of credit transaction, the exporter receives its payment from
a.the importer
b.the importer’s bank
c.the exporter’s bank
d.the government
18) in a(n) _____, no discriminatory tariffs, quotas, subsidies, or administrative
impediments are allowed to distort trade between member nations; however, each
country is allowed to determine its own trade policies with regard to nonmembers.
a.common market
b.economic union
c.political union
d.free trade area
19) describe the state of economic integration in africa. what factors have hindered the
process?
20) the bretton woods agreement could only work if the u.s. had:
a.high inflation and no balance-of-payments deficit
b.low inflation and no balance-of-payments deficit
c.low inflation and a current account deficit
d.high inflation and a capital account surplus
21) _____ are exchange rates governing some specific future date foreign exchange
transactions.
a.spot exchange rates
b.forward exchange rates
c.future exchange rates
d.currency swaps
22) the convention on combating bribery of foreign public officials in international
business transactions excludes:
a.speed payments to secure contracts that would otherwise not be secured
b.grease payments to gain exclusive preferential treatment
c.facilitating payments made to expedite routine government action
d.payments to government officials for special privileges
23) the threat of tariff barriers by the host government can make _____ very risky.
a.greenfield investment
b.franchising
c.licensing
d.exporting
24) a currency is said to be externally convertible when:
a.the country’s government allows both residents and nonresidents to purchase
unlimited amounts of a foreign currency with it
b.only nonresidents may convert it into a foreign currency without any limitations
c.neither residents nor nonresidents are allowed to convert it into a foreign currency
d.only residents may convert it internally into a foreign currency
25) it has been argued that the success of japanese enterprises in the global economy
has been based partly on all of the following except:
a.the diffusion of self-managing work teams
b.the close cooperation among different functions within japanese companies
c.the high degree of managerial mobility between companies
d.the cooperation between a company and its suppliers on issues such as design, quality
control, and inventory reduction
26) identify the incorrect statement pertaining to the eu’s court of justice.
a.it is comprised of one judge from each country
b.it is the supreme appeals court for eu law
c.its judges are required to act as representatives of national interests
d.a member country can bring other members to the court for failing to meet eu treaty
obligations
27) firms engaging in _____ with a local company can benefit from a local partner’s
knowledge of the host country’s competitive conditions, culture, language, political
systems, and business systems.
a.turnkey projects
b.joint ventures
c.greenfield investments
d.licensing arrangements
28) which of the following statements best defines a customs union?
a.all barriers to the trade of goods and services among member countries are removed
and each country maintains its own policy towards nonmember countries
b.it eliminates trade barriers between member countries and adopts a common external
trade policy and a common currency
c.it has no barriers to trade between member countries, includes a common external
trade policy, and allows factors of production to move freely between members
d.it eliminates trade barriers between member countries and adopts a common external
trade policy
29) the simultaneous purchase and sale of a given amount of foreign exchange for two
different value dates is referred to as a:
a.fiscal barter
b.liquid trade
c.currency exchange
d.currency swap
30) the theory of _____ makes a crude case for government involvement in promoting
exports and limiting imports.
a.mercantilism
b.free trade
c.absolute advantage
d.comparative advantage
31) the means a firm chooses for delivering the product to the consumer is its:
a.communication strategy
b.segmentation strategy
c.product attributes
d.distribution strategy
32) michael porter has argued that _____ and _____ are two basic strategies for creating
value and attaining a competitive advantage in an industry.
a.differentiation; price competition
b.economies of scale; diversification
c.low cost; differentiation
d.efficiency; promotion
33) a strategy that focuses on increasing the attractiveness of a product is referred to as
a(n):
a.differentiation strategy
b.low cost strategy
c.effectiveness strategy
d.efficiency strategy
34) discuss the exim bank, its goals, and its operations.
35) what are auditing standards? how are they different from accounting standards?
36) discuss bartlett and ghoshal’s perspective on how firms from developing countries
should approach international expansion.
37) what is a pegged exchange rate system? give example of a country following it.
38) discuss the trend toward increased regional economic integration.
39) what is franchising? what type of firm uses franchising as a means of expanding
into foreign markets?
40) define licensing agreements. what are the advantages of this mode of international
expansion?
41) consider the influence of confucian ethics on the economies of china, japan, south
korea, and taiwan.
42) what is a consolidated financial statement? what type of firms usually makes use of
it?
43) explain the five reasons why a firm should decentralize its decision-making.