Chapter 1: Globalization

International trade occurs when a firm _____. Multiple choice question. invests in business activities inside its home country. removes a foreign supplier from its supply chain. exports goods or services to consumers in another country. purchases a foreign company.

exports goods or services to consumers in another country.

The International Monetary Fund and the World Bank are both examples of _____ that help govern the global business system. Multiple choice question. global institutions mini-multinationals federal mandates foreign markets

global institutions

The globalization of _____ is the term used to describe the merging of national markets into one large global place. Multiple choice question. production consumers institutions markets

markets

The problems faced while managing an international business are _____ complex than those faced while managing a purely domestic business. Multiple choice question. equally as more less

more

A(n) ______ is any entity that conducts business in at least two countries. Multiple choice question. conglomerate intrastate corporation transnational union multinational enterprise

multinational enterprise

Paragon Corp., based in Ohio, sources goods from Southeast Asia to take advantage of labor cost savings. This company is benefiting from _____. Multiple choice question. the globalization of production a franchise operation domestic production intrastate investment

the globalization of production

While managing an international business, one of the tasks of managers is to Multiple choice question. disregard the cultural, political, and legal differences between countries. always use the firm's home currency rather than foreign currency for cross-border transactions. decide if it is ethical to accept the lower labor and environmental standards found in many less developed nations. avoid dispersing production activities across various locations around the world.

decide if it is ethical to accept the lower labor and environmental

The globalization of the world economy has resulted in a relative _____ in the dominance of US firms in the global marketplace. Multiple choice question. expansion decline increase upturn

decline

The globalization of the world economy has resulted in a relative _____ in the dominance of US firms in the global marketplace. Multiple choice question. expansion increase upturn decline

decline

Creating and managing a globally dispersed production system is made easier by the ______ in costs of information processing and communication. Multiple choice question. increase decrease elimination

decrease

It is common practice for people today to use products that are produced or assembled in various nations around the world. This is a reflection of _____. Multiple choice question. globalization dynamism nationalism centralization

globalization

The increasing number of trade agreements in place around the world creates a(n) _____ in world trade. Multiple choice question. decrease increase

increase

As the barriers to the free flow of goods, services, and capital fell during the 1970s, one motivation for foreign direct investment by non-US firms was the desire to________________________________ Multiple choice question. limit the use of communication technology. decrease their shares of world output. move production activities to more desirable locations. raise the barriers to cross-border investments

move production activities to more desirable locations.

Advances in information processing and communication are two ways _____ has made the globalization of markets a reality. Multiple choice question. logistics technology production media

technology

The stock of foreign direct investment refers to the ______ of foreign investments. Multiple choice question. percentage of increase total cumulative value return of goods diminished value

total cumulative total

Among developing nations, ______ has been the largest recipient of foreign direct investment. Multiple choice question. Sudan Argentina Indonesia China

China

Which statement regarding conducting international business in China is accurate? Multiple choice question. Foreign direct investment in China has decreased in the past ten years. China-based firms are proving to be poor competitors. The market in China is saturated with fewer opportunities for FDI. China represents a large and basically untapped market.

China represents a large and basically untapped market.

True or false: The first web browser was introduced to the public in the 1970s and started the explosive growth of the Internet in foreign transactions. True false question. True False

False

The World Trade Organization (WTO) is the successor to ______. Multiple choice question. the IMF GATT G20 the UN

GATT

What is an accurate description of the globalization of production? Multiple choice question. Reducing the carbon footprint caused by the transportation of goods throughout the world Locating each stage of production where it can be done most economically Making countries economically self-sufficient without requiring help from external sources Reducing cross-border trade due to increased barriers

Locating each stage of production where it can be done most economically

Which organization ensures that nation-states comply to the rules associated with trade treaties signed by member states? Multiple choice question. The United Nations The World Bank The World Trade Organization The International Monetary Fund

The World Trade Organization

When global institutions were introduced in the 1940s, governments in struggling nations would turn to the _____ for low-interest loans needed for infrastructure projects such as building roads. Multiple choice question. World Bank International Monetary Fund G20 United Nations

World Bank

Which of these companies is facing an impediment to the globalization of production? Multiple choice question. Jameson Grills buys component parts from a European company that will only ship via aircraft. Roll-Fast Skate Inc. plans to market its product globally but source parts domestically. US law dictates that Tru-Brite Dental cannot send X-rays electronically to be read by an overseas company. Europe recently dropped its trade barriers and now Kleen-Source Corp. can take advantage of a low-cost supplier

US law dictates that Tru-Brite Dental cannot send X-rays electronically to be read by an overseas company.

Just a few decades ago, it would have cost a business much more money to find buyers in a foreign country. What has helped lower the cost of this process and allows buyers and sellers to easily find each other regardless of their location? Multiple choice question. transportation tariffs JIT inventories Internet

Internet

Select all that apply What are the four basic purposes of the United Nations? Multiple select question. being a center for harmonizing the actions of nations developing friendly relations between nations creating a vibrant and sustainable economy fostering trade agreements between competitor nations maintaining international peace solving humanitarian, cultural, and social issues

being a center for harmonizing the actions of nations developing friendly relations between nations maintaining international peace solving humanitarian, cultural, and social issues

The United Nations was established by _____ countries committed to preserving peace through economic cooperation and trade support. Multiple choice question. 14 112 2 51

51

Select all that apply According to the critics of globalization, what are two results from falling trade barriers? Multiple select question. Greater opportunities for manufacturing in developed countries A depression of wages in developed nations The destruction of manufacturing jobs in advanced economies A reduction in the pool of global labor

A depression of wages in developed nations The destruction of manufacturing jobs in advanced economies

Based on rankings by Forbes in 2003, the second-largest source country of multinational enterprises was _____. Multiple choice question. the United States the United Kingdom China Japan

Japan

Why would a company engage in the globalization of production? Multiple choice question. To increase the barriers to cross-border trade To move closer to their competition To foster government intervention To lower their overall cost structure

To lower their overall cost structure

According to critics of globalization, increased free trade and investment over the past few decades have Multiple choice question. prevented countries from being interdependent on one another. broadened the gap between the rich and poor nations. reduced job opportunities in developing nations. decreased the selection of goods and services available to consumers.

broadened the gap between the rich and poor nations.

The opponents of globalization argue that falling barriers to international trade will Multiple choice question. reduce job opportunities in developing nations where wages are much lower. increase service jobs around the world. eliminate manufacturing jobs in wealthy economies. prevent countries from being interdependent on one another.

eliminate manufacturing jobs in wealthy economies.