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an expatriate manager is a citizen of one country who is working abroad in one of the
firms subsidiaries.
Royalties represent the remuneration paid to the owners for the use of technology or the
right to manufacture and/or sell products under patents or trade names.
cost savings that come from learning by doing are known as economies of scale.
A domestic business must find ways to work within the limits imposed by governmental
intervention in the international trade and investment system.
relational capital refers to the building of interpersonal relationships between the firms
managers in a strategic alliance.
The fixed exchange rate system established at Bretton Woods failed due to speculative
pressures on the U.S. dollar.
a specialized asset is an asset that is used to perform day-to-day activities.
the trade related aspects of intellectual property rights, attempts to reduce intellectual
property protections to enhance trade.
an oligopoly is an industry composed of a limited number of large firms.
refreezing an organization should happen quickly.
strategic alliances build trust between the firm and its suppliers.
if $1 bought more yen with a spot exchange than with a 30-day forward exchange it
indicates the dollar is expected to depreciate against the yen in the next 30 days. when
this occurs, we say the dollar is selling at a premium on the 30-day forward market.
a buyback occurs when a direct exchange of goods or services occur between two
parties without a cash transaction.
specific tariffs are levied as a proportion of the value of the imported good.
a company that sells its product in a foreign market below the cost of production may
be accused of dumping.
japans great trading houses are called ____.
a.sogo shosha
b.kaizen
c.miti
d.samurai
country a exports electronic goods from country b although there are no underlying
differences in factor endowments between the two countries. which of the following
theories explains this anomaly?
a.comparative advantage theory
b.new trade theory
c.ricardos theory
d.smiths theory
which of the following is an example of a greenfield investment?
a.a chinese sugar maker setting up a sugar crushing facility in cuba
b.a serbian automobile company purchasing a croatian component manufacturer
c.a finnish mobile phone manufacturer expanding its production facility in finland
d.an indian oil exploration company acquiring an oil refining company
in some countries, the official gni per capita measured at ppp data does not reflect the
actual the total annual income because:
a.it doesnt consider differences in the cost of living
b.it gives a static picture of development
c.it fails to include income earned from other countries in the form of dividends
d.large amounts of economic activity may be in the form of barter agreements
the following totals for the month of april were taken from the payroll register of metz
company.
the journal entry to record the monthly payroll on april 30 would include a
a.debit to salaries and wages expense for $20,000
b.credit to salaries and wages payable for $20,000
c.debit to salaries and wages payable for $20,000
d.debit to salaries and wages expense for $13,267
which of the following statements is true of exporting?
a.it increases the trade deficit that nations have
b.exporting leads to diseconomies of scope
c.it helps a firm achieve economies of scale
d.exporting is not beneficial to a countrys economy
which of the following is a statement that supports the theory of comparative
advantage?
a.international trade is a zero-sum gain where one nations gain is anothers loss
b.domestic industries are at risk when a country engages in free trade
c.a country should maintain trade surplus to succeed in global trade
d.global production is greater with free trade than it is with restricted trade
when companies disperse different stages of the value chain to those locations around
the world where perceived value is maximized or where the costs of value creation are
minimized, companies create:
a.a differentiated organization
b.a location economy curve
c.economies of scale
d.a global web of value creation activities
which of the following factors has made the united states an attractive target for foreign
direct investment?
a.its unstable economy
b.its unfavorable political environment
c.its wealthy domestic markets
d.its closed society
systematic risk refers to movements in a stock portfolios value that are ____.
a.attributable to macroeconomic forces affecting an economy
b.specific to the firm or individuals who invest in a portfolio
c.attributable to factors pertaining to an individual firm
d.specific to the company that facilitates the investment portfolio
the great promise of exporting is that ____.
a.large revenue opportunities are often found in foreign markets
b.it provides more opportunities to smaller firms than larger firms
c.international trade is protected against exchange risks
d.it reduces the need for insuring businesses against political risks
which of the following statements about small-scale entry is true?
a.the commitment associated with a small-scale entry makes it possible for the
small-scale entrant to capture first-mover advantages
b.small-scale entry is a way to gather information about a foreign market before
deciding whether to enter on a significant scale
c.by giving a firm time to collect information, small-scale entry increases the risks
associated with a subsequent large-scale entry
d.small-scale entry limits a firms ability to learn about a foreign market thereby also
limiting the firms exposure to that market
practical training is:
a.provided to foster an appreciation for the host countrys culture
b.aimed at helping expatriates improve their communication skills
c.aimed at helping expatriate managers to build relationships in the host-country
d.aimed at helping the expatriate manager and family ease themselves into day-to-day
life in the host country
_____ involves removing legal restrictions to the free play of markets, the
establishment of private enterprises, and the manner in which private enterprises
operate.
a.deregulation
b.trade certification
c.a product law
d.a liability law
if the demand for dollars outstrips its supply and if the supply of japanese yen is greater
than the demand for it, what will happen?
a.the dollar will appreciate against the yen
b.the dollar will depreciate against the yen
c.the exchange rates will remain the same
d.the yen will appreciate against the dollar
the emphasis on local responsiveness in firms pursuing a localization strategy creates
strong pressures for:
a.centralizing all decisions regarding marketing, r&d, and human resource management
b.decentralizing operating decisions to foreign subsidiaries
c.centralizing all operating decisions
d.global learning
The problem of blocked earnings is not as serious now as it once was because _____.
A.fixed exchange rates have become more common now
B.governmental intervention in earnings is more frequent now
C.there is greater acceptance of free market economics now
D.political risk within the economy is very low in modern times
on january 1, 2012, $1,000,000, 10-year, 10% bonds, were issued for $970,000. interest
is paid annually on january 1. if the issuing corporation uses the straight-line method to
amortize discount on bonds payable, the monthly amortization amount is
a.$9,700
b.$3,000
c.$808
d.$250
integration mechanisms are:
a.the formal division of the organization into subunits
b.the mechanisms that enable each subunit to operate independently
c.the mechanisms for coordinating subunits
d.the location of decision making responsibilities within a structure
sales taxes collected by a retailer from a customer are expenses
a.of the retailer
b.of the customers
c.of the government
d.that are not recognized by the retailer until they are submitted to the government
Explain the concept of transfer pricing.
what are the main strengths and weaknesses of the worldwide product division
structure?
Describe the problem of blocked earnings.
why do organizations appoint an ethics officer?
draw a distinction between firms based on their core competency.
what is mass customization?
explain briefly the regulatory influences on pricing.
discuss the creation of a global web of value creation activities.
why do many economists favor internalization theory as an explanation for fdi
compared to knickerbockers theory?
