BA Chapter 3

________ is the tendency to judge all other groups according to standards, behaviors, and customs that prevail in one's own group.

Ethnocentrism

Which of the following arguments supports the idea of free trade?

International trade must take place without any interference.

________ are politically motivated embargoes that revoke a country's normal trade relations status.

Sanctions

Which of the following best describes economic globalization?

The increasing integration and interdependence of world-wide national economies.

________ is a permanent forum for negotiating, implementing, and monitoring international trade procedures and for mediating trade disputes among member countries.

World Trade Organization

The number of units of one currency that must be exchanged for a unit of the second currency is known as the ________ between the currencies.

exchange rate

Which of the following is an objective of protectionism?

guarding specific industries in a nation

Dumping ________.

involves selling a product at a price lower than the cost of production

As one of the largest trading blocs, the European Union has created their own currency to ________.

make transactions less expensive

A company benefits from economies of scale when it ________.

manufactures and distributes products in higher quantities

A country can assist its domestic producers by implementing ________ such as special business licenses and limiting foreign companies' access to them.

restrictive import standards

The classic theory of comparative advantage suggests that each country should ________.

specialize in those areas where it can produce more efficiently than other countries

Taxes, surcharges, or duties levied against imported goods are known as ________.

tariffs

International companies can use ________ to shield some of their income from higher tax rates in their own countries.

tax havens

A country's balance of payment equals the ________.

total flow of money into the country minus the total flow of money out of the country

A country has a trade surplus when the ________.

value of its exports exceeds the value of its imports

A country has a trade deficit when the ________.

value of its imports exceeds the value of its exports

How can a person improve the communication process when working with a person from another culture?

Learn how respect is communicated in various cultures.

Which of the following has made the rapid growth in global business possible by making it safer, easier, and more profitable?

advances in communication and transportation technologies

When the U.S. dollar is strong, U.S. exports will likely ________.

cost more in other countries