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In what type of economy are certain sectors of the economy left to private ownership
and free market mechanisms, while in other sectors there is significant state ownership
and government planning?
A.Command
B.Pure market
C.Mixed
D.Centrally planned
E.Laissez-faire
Answer:
Although China and India are very large markets when measured by number of
consumers, they are relatively small markets when measured in economic terms due to
their:
A.orientation toward democracy.
B.small share in the world output.
C.high living standards.
D.limited purchasing power.
E.commitment to a free market system.
Answer:
Which one of the following refers to an exchange rate system under which a country's
exchange rate is allowed to fluctuate against other currencies within a target zone?
A.Free float
B.Fixed peg
C.Adjustable peg
D.Pure float
E.Capital float
Answer:
Which of the following approaches to forecasting exchange rate movements uses price
and volume data to determine past trends?
A.Technical analysis
B.Behavioral equilibrium model
C.Interest rate parity equation model
D.Fundamental analysis
E.Portfolio balance model
Answer:
The amount of value a firm creates is measured by:
A.the difference between the previous year's profitability and the current year's
profitability.
B.dividing the market price of its products by the price that customers are actually
willing to pay.
C.the difference between its costs of production and the value that consumers perceive
in its products.
D.dividing the net profits of the firm by total invested capital.
E.the sum of the profitability of the last two fiscal years.
Answer:
Dharma, karma, and nirvana are terms related to:
A.Confucianism.
B.Hinduism.
C.Judaism.
D.Islam.
E.Protestantism.
Answer:
Which of the following is true of the Court of Justice?
A.The judges are required to act as representatives of national interests.
B.It comprises several judges from a few selected countries.
C.It is the supreme appeals court for European Union law.
D.A member country cannot bring another member country to this court.
E.Member countries cannot bring the commission or the council to this court.
Answer:
Which of the following allows two or more firms to share the fixed costs (and
associated risks) of developing new products or processes?
A.Franchising agreement
B.Global web
C.Free trade agreement
D.Strategic alliance
E.Dispersion linkage
Answer:
Which of the following statements is true of Islam?
A.Islam has roots in Confucianism.
B.Islamic ethics support worldly gain and temporal power.
C.Islam forbids the consumption of pork and alcohol.
D.Islam makes a clear distinction between church and state.
E.Unlike Christianity and Judaism, Islam is not a monotheistic religion.
Answer:
Which of the following is a significant impact of the North American Free Trade
Agreement (NAFTA)?
A.It led to decreased economic stability in Canada.
B.It led to a major trade deficit for Canada.
C.It helped create the background for increased political stability in Mexico.
D.It led to a trade surplus for all the three member nations.
E.It led to a reduction in purchasing power of consumers in America.
Answer:
Under John Rawls's concept of veil of ignorance, people are imagined to be ignorant of
their:
A.fundamental duties.
B.fundamental rights.
C.particular characteristics such as race, sex, and nationality.
D.political and economic freedom.
E.social responsibilities.
Answer:
Which of the following is an advantage of turnkey projects as a mode of entry into
foreign markets?
A.It is an ideal way to gain entry into a country where FDI is not limited by government
regulations.
B.It is a useful strategy to earn great returns from the know-how of a technologically
complex process.
C.It is an ideal way to establish a firm's long-term presence in a foreign country.
D.It helps protect a firm's competitive advantage.
E.The firm that enters into a turnkey project with a foreign enterprise avoids giving rise
to potential competitors.
Answer:
Which of the following is an advantage of acquisitions as a means of entering foreign
markets?
A.They are quick to execute and help firms to rapidly build their presence in the target
foreign market.
B.It is much easier to change the culture of an existing organization than build a new
organization.
C.It is easier to convert the operating routines of acquired units than establish routines
in new subsidiaries.
D.They give firms access to valuable intangible assets while minimizing a pileup of
tangible assets.
E.Acquired firms are often undervalued and hence assets can be purchased at minimal
prices.
Answer:
One of the downsides to the emphasis on individualism is that it:
A.is difficult to build teams within an organization to perform collective tasks.
B.does not support entrepreneurship and innovation.
C.discourages managerial mobility.
D.fails to foster general managerial skills required to find solutions to current problems.
E.discourages competition among employees within a company.
Answer:
In the context of the environment, globalization critics argue that:
A.free trade discourages firms from advanced nations to move manufacturing facilities
to less developed countries.
B.adhering to labor and environmental regulations significantly increases the costs of
manufacturing enterprises.
C.manufacturing enterprises are put at a competitive disadvantage by moving their
production facilities to nations that do not have burdensome regulations.
D.as countries get richer, they relax their environmental and labor regulations.
E.while pollution levels are rising in the world's richer countries, they have been falling
in developing nations.
Answer:
A firm's failure to understand host-country cultural differences that require different
approaches to marketing and management is referred to as:
A.cultural parity.
B.cultural myopia.
C.power distance.
D.cultural toughness.
E.cultural polarization.
Answer:
Which of the following refers to a subset of expatriates who are citizens of a foreign
country working in the home country of their multinational employer?
A.Virtual expatriates
B.Inpatriates
C.Third-country nationals
D.Host-country nationals
E.Parent-country nationals
Answer:
Which of the following is inconsistent with Marxist philosophy?
A.Concern over public good rather than private profit
B.Monopoly of state-owned companies in certain industries
C.Opposing the ideologies of capitalist societies
D.Substantial limits on individual political freedom
E.Selling state-owned enterprises to private investors
Answer:
In which countries are we likely to find free market economies?
A.Countries where the good of the society has precedence over private profit
B.Countries where individual goals are given primacy over collective goals
C.Countries where state-owned enterprises have a monopoly in certain industries
D.Countries that have adopted communism as their political system
E.Countries where the government plans the goods and services produced
Answer:
The government of Great Lanthania is planning to adopt a market-based economic
system. To be able to do so, the government of this country should:
A.abolish the laws that deal with protection of property rights.
B.introduce stringent foreign investment regulations.
C.increase its intervention in the economy.
D.adopt privatization.
E.oppose democracy.
Answer:
In comparison to a floating exchange rate regime, a fixed exchange rate system is
characterized by:
A.smoother trade balance adjustments.
B.increased destabilizing effects of exchange rate speculation.
C.greater autonomy in terms of monetary policy.
D.higher monetary discipline.
E.greater exchange rate uncertainty and volatility.
Answer:
Which of the following occurs when residents and nonresidents of a country rush to
convert their holdings of domestic currency into a foreign currency?
A.Deflation
B.Arbitrage
C.Liquidity rush
D.Capital flight
E.Currency swap
Answer:
Amanda, an American manager, is successfully adjusting in a country where the culture
is extremely male-dominated. According to Mendenhall and Oddou, which of the
following dimensions that predict success in foreign postings is involved in this
situation?
A.Perceptual ability
B.Others-orientation
C.Cultural toughness
D.Self-orientation
E.Empathy
Answer:
Michelle, an Italian fashion designer, sells her merchandise by exporting them to the
United States, United Kingdom, and Brazil. According to this information, Michelle is
most likely involved in:
A.foreign direct investment.
B.globalization of production.
C.international trade.
D.multinational enterprise.
E.outsourcing.
Answer:
Which of the following is true of the Treaty of Lisbon that was signed in 2007?
A.It defined the European Commission's role in competition policy.
B.It brought the commission to the court for failure to act according to a European
Union treaty.
C.It created the position of the president of the European Council.
D.It lifted barriers to competition in the retail banking and insurance businesses.
E.It created the Court of Justice, the supreme appeals court for European Union law.
Answer:
Why was the World Bank set up?
A.To preserve peace through international cooperation
B.To promote economic development
C.To maintain order in the international monetary system
D.To formulate a coordinated policy response to financial crises
E.To police the world trading system
Answer:
Which of the following concepts was developed by John Rawls and posited that
everyone is imagined to be oblivious to all of his or her particular characteristics, such
as, race, sex, intelligence, nationality, family background, and special talents?
A.Tragedy of the commons
B.Naive immoralism
C.The Universal Declaration of Human Rights
D.Veil of ignorance
E.Difference principle
Answer:
Which of the following refers to a system under which a country's currency is
nominally allowed to float freely against other currencies, but in which the government
will intervene, buying and selling currency, if it believes that the currency has deviated
too far from its fair value?
A.Fixed float
B.Clean float
C.Pegged float
D.Dirty float
E.Capital float
Answer:
Which of the following is most likely to be true about the overall attractiveness of a
country as a potential market or investment site for an international business?
A.The potential long-run benefits of doing business in a foreign country are
independent of the country's future economic growth rates.
B.The costs and risks associated with doing business in a foreign country are highest in
economically advanced democratic nations.
C.Economic growth tends to be higher in a centrally planned command economy
system than in a free market system.
D.The risks associated with doing business are low in developing nations where the
governments have huge debts.
E.The costs and risks associated with doing business in a foreign country tend to be
greater in politically unstable nations.
Answer:
Which of the following is an advantage of adopting a geocentric staffing approach?
A.It tends to reduce cultural myopia and enhance local responsiveness.
B.It is inexpensive to implement.
C.It reduces the costs of value creation.
D.It allows all key management positions of a firm and its subsidiaries to be filled by
parent-country nationals.
E.It requires minimal documentation for hiring foreign nationals.
Answer:
A company can increase its growth rate by taking goods or services developed at home
and selling them internationally. The returns from such a strategy are likely to be
greater if:
A.the product is already being offered by local companies in the nations that the
company enters.
B.the product is a generic product that requires little differentiation.
C.indigenous competitors in the nations that the company enters lack comparable
products.
D.there is a high inflation in the nations that the company enters.
E.the product is perceived to be very costly in the home country of the company.
Answer:
Which of the following refers to a permanent bailout fund, worth about €500 billion, set
up by the euro zone nations to restore confidence in the euro?
A.European Fiscal Union
B.European Fiscal Compact
C.Troubled Assets Relief Program
D.European Stability Mechanism
E.European Financial Stability Facility
Answer:
