in the modern era, the concept of countertrade arose as a way for the united states to
purchase imports.
upward migration in the strategic role of foreign production sites arises when they
upgrade their own capabilities.
decentralization of production is appropriate when the product does not serve universal
needs.
fdi has been declining in the last few decades because protectionist pressures have
become less intense.
“creative destruction” makes it important for companies to stay on the leading edge of
technology.
discount on bonds payable may be amortized by the straight-line method if the results
obtained by its use do not materially differ from the results obtained by use of the
effective-interest method.
which of the following is a disadvantage of global capital market?
a.foreign investments may be driven by speculative flows in the market
b.a truly global market reduces the liquidity of investments
c.the availability of capital is low in a global capital market
d.the cost of capital is more in a global market than a domestic market
historically, unilever measured the performance of national operating subsidiary
companies according to profitability. in this example, profitability is a(n):
a.control system
b.process
c.integrating mechanism
d.incentive
in a country where competition is limited, ____.
a.prices will be low
b.there will be low elasticity of demand
c.prices will be high
d.consumers bargaining power rises
early entrants to a market that are able to create switching costs that tie the customer to
the product are capitalizing on _____.
a.first-mover advantages
b.pioneering costs
c.economies of scale
d.late-mover advantages
a $600,000 bond was retired at 98 when the carrying value of the bond was $592,000.
the entry to record the retirement would include a
a.gain on bond redemption of $8,000
b.loss on bond redemption of $4,000
c.loss on bond redemption of $8,000
d.gain on bond redemption of $4,000
_____ allows the company to produce a wider variety of end products at a unit cost that
at one time could be achieved only through the mass production of a standardized
output.
a.standardization
b.kaizen
c.six sigma
d.lean production
garrison company issued $1,000,000, 7%, 20-year bonds on january 1, 2012, at 105.
interest is payable annually on january garrison uses straight-line amortization for bond
premium or discount.
instructions
prepare the journal entries to record the following events.
(a)the issuance of the bonds.
(b)the accrual of interest and the premium amortization on december 31, 2012.
(c)the payment of interest on january 1, 2013.
(d)the redemption of the bonds at maturity, assuming interest for the last interest period
has been paid and recorded.
a political benefit of economic integration is that:
a.it enables participants to achieve gains from the free flow of trade
b.it enables participants to achieve gains from the free flow of investment
c.it allow countries to specialize in the production of goods and services that they can
produce most efficiently
d.it reduces the potential for violent conflict
for firms that are selling a product that serves universal needs, and that do not face
significant competition, a(n) _____ strategy makes sense.
a.localization
b.international
c.transnational
d.global standardization
liabilities are classified on the balance sheet as current or
a.deferred
b.unearned
c.long-term
d.accrued
the worldwide product division structure:
a.is weak in local responsiveness
b.inhibits the realization of location economies
c.inhibits the realization of experience curve economies
d.limits the transfer of core competencies between areas
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
in a seminal study, r. l. tung found that for american multinationals, the biggest
impediment to expatriate success was:
a.the inability of the spouse to adjust
b.the managers inability to adjust
c.the managers inability to cope with larger overseas responsibilities
d.the lack of adequate technical training
an ethnocentric staffing policy is one in which:
a.all key management positions are filled by host-country nationals
b.host-country nationals are recruited to manage subsidiaries
c.all key management positions are filled by parent-country nationals
d.the best people are recruited for key jobs throughout the organization, regardless of
nationality
which of the following is an example of a support activity in a firms value chain?
a.r&d
b.customer service
c.human resources
d.marketing and sales
which of the following is a factor that makes eurobonds more attractive than most
major domestic bonds?
a.presence of a regulatory interference
b.strong disclosure requirements
c.favorable tax status
d.protection from exchange risks
winrow company received proceeds of $377,000 on 10-year, 8% bonds issued on
january 1, 2011. the bonds had a face value of $400,000, pay interest annually on
december 31st, and have a call price of 101. winrow uses the straight-line method of
amortization. what is the amount of interest winrow must pay the bondholders in 2011?
a.$30,160
b.$32,000
c.$34,300
d.$29,700
totalitarianism:
a.refers to a political system in which government is by the people, exercised either
directly or through elected representatives
b.is based on a belief that citizens should be directly involved in decision making
c.is a form of government in which one person or political party exercises absolute
control over all spheres of human life
d.is based on the idea that the welfare of society is best served by letting people pursue
their own economic self-interests
Why is managing an international business different from managing a purely domestic
business?
what are the four basic strategies that firms use to compete in international markets?
compare and contrast currencies that are freely convertible, externally convertible, and
nonconvertible.
discuss the idea of compensation or buybacks as they relate to countertrade. provide an
example of a buyback arrangement.
how can a firm increase its profitability?
what is the main attraction of countertrade?