EXAM #2 CBA 300 (Chapters 5, 6, 7, 10, and 13)

Why do gov'ts decide to own businesses?

1. Gov'ts can better ensure equal access to access to and control over basic services we consider public goods (i.e. education and healthcare) 2. Can protect against corruption 3. Put social goals ahead of profit 4. Reliably provide vital services like national defense

Typical objectives of terrorism?

1. collect a ransom 2. overthrow a govt 3. gain the release of imprisoned colleagues 4. exact revenge for real or imagined wrongs 5. punish non-believers

Which is an example of a government-owned business in the United States? National Rifle Association Federal Trade Commission United Nations Export-Import Bank

Export-Import Bank

True or false: A compound duty is stated as a percentage of the invoice value of the product.

FALSE Reason: An ad valorem duty is stated as a percentage of the product's invoice value.

True or false: In most parts of the world, you will not find government-owned businesses.

FALSE Reason: Nearly all types of economies have some form of government-owned business.

True or false: A compound duty is a combination of specific and nontariff barriers.

FALSE Reason: A compound duty is a combination of specific and ad valorem duties.

True or false: Government ownership of a business can result in putting profits ahead of social goals.

FALSE Reason: Government ownership can put social goals ahead of profits.

True or false: Import duties mean lower prices for the consumer.

FALSE Reason: Import duties raise the price of the good for the consumer.

True or false: Sanctions are effective at achieving their goal of forcing change in the targeted country.

FALSE Reason: Sanctions seldom achieve their goal of forcing change in the targeted country.

Which of the following industries has the highest tariffs worldwide? Multiple choice question. pharmaceuticals automobiles agriculture textiles

agriculture

Those who believe it is important to protect infant industries claim that, in the long run, these industries will have a(n) Blank______advantage, but in the meantime these firms need protection from imports. Multiple choice question. perfect comparative absolute monopolistic

comparative

A(n) ____________ duty is a combination of specific and ad valorem duties.

compound

Which of the following are government resources used to protect citizens when they are abroad? (Check all that apply.) Multiple select question. central intelligence agency consulates U.S. Department of State embassies

consulates embassies

What do competitors in importing nations ask their governments to impose to offset the effects of a subsidy? Multiple choice question. predatory dumping nuisance tariffs countervailing duties variable levies

countervailing duties

A(n) ________ ____________assessment reviews a country's economic situation and politics to determine how much risk to employees, property, and investment exists for firms doing business there.

country risk

Governmental intervention in trade reflects a governmental trade strategy in ______________ (Japan/United States).

Japan

In 2018, U.S. trade policy included active sanctions against _______. (Check all that apply.) Multiple select question. North Korea South Korea Iraq Sudan Libya

North Korea Sudan Libya

_____________ is hijacking that includes kidnapping on the seas.

Piracy

Any illegal Internet-mediated activity that takes place in electronic networks is called _________. Multiple choice question. piracy ad valorem cybercrime phishing

cybercrime

What are the three major groupings of nonquantitative nontariff barriers? (Check all that apply.) Multiple select question. direct government participation in trade standards customs and other administrative procedures voluntary export restraints

direct government participation in trade standards customs and other administrative procedures

Economists argue that the best way to protect national security and provide for national defense is through Blank______. Multiple choice question. direct government subsidies complete embargo imposition of sanctions the implementation of isolationism

direct government subsidies

Economists argue that the best way to protect national security and provide for national defense is through Blank______. Multiple choice question. direct government subsidies the implementation of isolationism imposition of sanctions complete embargo

direct government subsidies

Which of the following cybercrimes are most often targeted at businesses? (Check all that apply.) Multiple select question. carbon footprinting domain-related offenses data espionage hacking

domain-related offenses data espionage hacking

Supporters of fair competition suggest that an import Blank______ will bring the cost of imported goods up to the cost of domestically produced goods. Multiple choice question. custom standard duty quota

duty

Julie's company imports all of its athletic shoe products from outside of the United States because it can obtain them for a lower cost based on the lack of environmental standards found in some countries. Those countries are engaged in Blank______ dumping. Multiple choice question. social environmental predatory regulatory

environmental

Antiterrorism training courses for executives often cover Blank______. (Check all that apply.) Multiple select question. the safest areas to live escape tactics evasive driving techniques security measures for the home crisis management

evasive driving techniques crisis management escape tactics

Voluntary export restraints are export quotas imposed by the _________ nation. Multiple choice question. exporting importing

exporting

In __________ kidnapping, the victim is kidnapped, often near an airport or international hotel, and forced to withdraw money from cashpoints or an ATM before being released.

express

In 2012, the Argentine energy company YPF was taken over by the Argentine government because the government said YPF was not investing sufficiently in the country. The government takeover of YPF is an example of nationalization or Blank______. Multiple choice question. a risk profile expropriation piracy intrastate business

expropriation

One way for businesses to protect themselves is to obtain KRE insurance, which protects against kidnapping, ransom, and _________. Multiple choice question. emergencies electrical fires exports extortion

extortion

Quotas are usually ___________ (local/global) in nature, with the total amount fixed regardless of the source.

global

After expropriation occurs, a business is owned by the ____________

government

Countervailing duties are imposed by a ______________ (business/government) to offset the effects of a subsidy.

government

International firms can be protected from terrorism and cybercrime through _____________ (business/government) actions.

government

Official prices are determined by _____________ (government/businesses) to correct for deficiencies in ad valorem duties.

government

With the advent of WTO agreements, nontariff barriers have gained ___________ (greater/lesser) importance.

greater

What kind of assistance can be provided by embassies and consular offices? (Check all that apply.) Multiple select question. help citizens contact family for money transfers file protests for abused citizens monitor nationals imprisoned abroad provide armed escorts out of dangerous situations inform about local political risk

help citizens contact family for money transfers file protests for abused citizens monitor nationals imprisoned abroad inform about local political risk

When comparing production levels at automotive plants in Mexico and the United States, productivity per worker is Blank______ in the United States than in Mexico. Multiple choice question. higher lower

higher

Tariffs are also called ___________ (import/export) duties.

import

Customs is a general term for duties paid on _____________.

imports

Which of the following challenges can unstable governments present to businesses? (Check all that apply.) Multiple select question. gradual policy changes strong political policies inability to ensure peace a pattern of unpredictable change

inability to ensure peace a pattern of unpredictable change

When governments impose trade restrictions, the cost of the traded goods will __. Multiple choice question. decrease increase remain the same

increase

Which of the following can businesses use to protect themselves against threats? (Check all that apply.) Multiple select question. employee training programs outsourced skills insurance trade protectionism

insurance employee training programs outsourced skills

Which of the following are characteristic of a stable government? (Check all that apply.) Multiple select question. maintains itself in power predictable fiscal policies predictable monetary policies radical political policies

maintains itself in power predictable fiscal policies predictable monetary policies

Currently, the most vulnerable area for cybercrime for many organizations is _________ (mobile/desktop) technology.

mobile

When governments _______ private firms, they move them from private ownership to public ownership.

nationalize

When governments __________ private firms, they move them from private ownership to public ownership.

nationalize

Which methods can a government use to minimize unfair international competition? (Check all that apply.) Multiple select question. negotiations between governments national laws universal system of law institutions such as the WTO

negotiations between governments national laws institutions such as the WTO

Tariffs assessed at very low rates are called __________ tariffs.

nuisance

A(n) Blank______ guarantees that a certain minimum import duty will be paid regardless of the actual invoice price. Multiple choice question. variable levy exact excise tax official price specific duty

official price

What are three typical objectives of terrorism? Multiple select question. foster a homogeneous society overthrow a government gain release of imprisoned colleagues exact revenge for real or imagined wrongs increase social stability

overthrow a government gain release of imprisoned colleagues exact revenge for real or imagined wrongs

U.S. cargo ships have been hijacked by groups from West Africa who demand money for the release of the ship. This form of hijacking is called Blank______. Multiple choice question. cybercrime piracy footprinting kidnapping

piracy

When a manufacturer lowers its export price to force the importing nation's domestic producers out of business, expecting to raise the price once it has accomplished that objective, the manufacturer is engaged in Blank______. Multiple choice question. cost-of-labor analysis predatory dumping ad valorem pricing domestic subsidizing

predatory dumping

Subsidies can take the form of _______. (Check all that apply.) Multiple select question. cash payments to the firm countervailing duties government participation in ownership preferential tax treatment

preferential tax treatment government participation in ownership cash payments to the firm

The selling of government-owned businesses to the private sector is known as _________

privatization, re-privatization, or reprivatization

What are some of the reasons a government would restrict trade? (Check all that apply.) Multiple select question. promote national defense preserve domestic jobs increase economies of scale protect domestic infant industries

protect domestic infant industries promote national defense preserve domestic jobs

A tariff-rate _________ permits a stipulated amount to enter duty-free or at a low rate, but a much higher duty is charged for additional quantities. Multiple choice question. arrangement quota custom standard

quota

Which quantitative nontariff barrier sets numerical limits for specific kinds of goods that a country will permit to be imported during a specified period? Multiple choice question. levy custom quota duty

quota

A business would purchase KRE insurance as a way to protect itself from kidnapping, ________, and extortion. Multiple choice question. rogue states radiation risk ransom

ransom

Economists agree that political barriers to trade Blank______. (Check all that apply.) Multiple select question. increase economies of scale encourage terrorism are detrimental to trade reduce economic efficiencies

reduce economic efficiencies are detrimental to trade

Which one of the following would be recognized in a country risk assessment? Multiple choice question. available environmental resources revolution against the government leading education facilities pollution levels

revolution against the government

Dumping is defined in several ways. Which of the following are definitions of dumping? (Check all that apply.) Multiple select question. selling a product abroad for less than the price in the home market selling a product abroad for less than the price to third-party countries selling a product abroad for less than the price of domestic producers selling a product abroad for less than the cost of production

selling a product abroad for less than the cost of production selling a product abroad for less than the price in the home market selling a product abroad for less than the price to third-party countries

A(n) _________ duty is a fixed sum of money charged for a specified physical unit of the product.

specific

Regardless of the value of the invoice, Kendall's company charges $0.14 per pound of butter exported. This tax is an example of a(n) Blank______ duty. Multiple choice question. ad valorem compound variable specific

specific

A government that has achieved _____________ has the ability to maintain itself in power and hold to predictable fiscal and political policies.

stability

Businesses like peace and predictability because they provide Blank______. Multiple choice question. challenges instability stability change

stability

Which of the following nonquantitative nontariff barriers are established to protect the health and safety of a nation's citizens but can also be complex and discriminatory towards exporting firms? Multiple choice question. customs tariffs quotas standards

standards

In the past, the U.S. government provided payments to farmers as a way to manage surplus food resulting from increased production needed to fuel WWII and to feed Europe. The government offset and controlled the overproduction of these crops so as to prevent them from flooding the market. These payments to farmers were an example of Blank______. Multiple choice question. duties quotas tariffs subsidies

subsidies

What is the most common form of direct government participation in trade? Multiple choice question. subsidy customs duties treaty quota

subsidy

Which of the following permits a stipulated amount of a good to enter duty-free or at a low rate, but when that amount is reached, a much higher duty is charged for additional quantities? Multiple choice question. embargoes orderly marketing arrangements customs taxes tariff-rate quota

tariff-rate quota

Unlawful acts of violence committed to achieve a variety of objectives are collectively known as ___________

terrorism

What are the areas of increasing concern to governments as they try to protect business activities? (Check all that apply.) Multiple select question. cybercrime larceny piracy terrorism kidnapping

terrorism kidnapping piracy cybercrime

A request for ransom is associated with the extreme act of _________ or ________

terrorism or kidnapping

A(n) Blank______ guarantees that the market price of the import will be the same as that of domestically produced goods. Multiple choice question. ad valorem duty compound duty variable levy official price

variable levy

The rates for nuisance tariffs are Blank______. Multiple choice question. very high determined by the product very low the result of subsidies

very low

Unfair International Competition is minimized through:

1. national laws 2. negotiations between govts 3. the efforts of institutions such as the World Trade Org.

What kind of assistance can be provided by embassies and consular offices?

1. represent their interests and offer protection to their citizens abroad 2. provide info about local political risks 3. can help citizens contact family or friends for money transfers if needed 4. monitor nationals imprisoned abroad 5. in the case of abuse of citizens, they may file protests

What are the layers of defense against cybercrime?

1. the host 2. the actual physical layer (buildings/services) 3. the human 4. the application 5. the data 6. the network each of these layers must be monitored along the supply chain at all times. For instance, a security effort might include: a. auditing b. reviewing usage traffic c. testing for vulnerabilities in each of the layers d. updating

What are the 8 reasons why governments nationalize private firms?

1. to extract more money from the firms 2. if the gov't suspects they are concealing profits 3. to increase profitability 4. the govt believes it can run the business more efficiently and make more money 5. to follow an economic or political ideology 6. to save jobs by propping up dying industries 7. to control an earlier investment in a firm 8. to enact political goals

It is estimated that worldwide there are more than _________ ransom and kidnapping situations every year. Multiple choice question. 3,000 500 1,000 16,000

16,000

CHAPTER #5 Political Forces that Affect Global Trade

CHAPTER #5 Political Forces that Affect Global Trade

Government intervention in trade would have been welcomed when _________ imposed a 241% tariff on milk from the United States. Multiple choice question. Australia Japan Canada Mexico

Canada

What are the potential drawbacks to placing a ban on the export of advanced technologies? (Check all that apply.) Multiple select question. It impedes the funding of continued innovation. It impedes efforts to sustain international market share. It prevents valuable technology from being used to strengthen competitors. It reduces export revenues for the country's manufactures.

It impedes the funding of continued innovation. It impedes efforts to sustain international market share. It reduces export revenues for the country's manufactures. (closing off foreign markets)

Why is paying ransoms often counterproductive? (Check all that apply.) Multiple select question. It rewards the kidnappers. It reinforces kidnappers' actions. It funds terrorism. Victims are seldom released.

It rewards the kidnappers. It reinforces kidnappers' actions. It funds terrorism.

______ dumping occurs when producers have lower wage rates, lower social costs, poor worker benefits, and poor working conditions. Multiple choice question. Predatory Environmental Social Regulatory

Social

True or false: Kidnappings now outnumber shootings of aid workers.

TRUE Reason: Kidnappings now outnumber shootings of aid workers.

True or false: A national system of law can minimize unfair international competition.

TRUE Reason: National law can minimize unfair competition.

True or false: The payment of ransoms to terrorist organizations violates international law.

TRUE Reason: The payment of ransoms to terrorist organizations violates international law.

Which of the following are characteristics of nontariff barriers? (Check all that apply.) Multiple select question. They impose additional costs on customers. They can be quantitative and nonquantitative. They encourage international trade. They impose additional costs on producers. They are forms of discrimination against imports.

They impose additional costs on producers. They impose additional costs on customers. They are forms of discrimination against imports. They can be quantitative and nonquantitative.

Which of the following statements are accurate regarding the cost-of-labor argument? (Check all that apply.) Multiple select question. The cost-of -labor argument for trade restrictions is a simple one. The cost-of-labor argument does not take into account relative productivity rates of workers in different countries. Comparing low foreign hourly wages to domestic hourly wages is misleading. Wages do not account for all the labor costs.

Wages do not account for all the labor costs. The cost-of-labor argument does not take into account relative productivity rates of workers in different countries. Comparing low foreign hourly wages to domestic hourly wages is misleading

Which duty is stated as a percentage of the invoice value of the product? Multiple choice question. voluntary specific compound ad valorem

ad valorem

There are several layers of defense against cybercrime. One of these is the actual physical layer, which includes Blank______. Multiple choice question. buildings competition applications data

buildings

The Smoot-Hawley Tariff Act demonstrates how tariffs can cause world trade to _____________ (increase/decrease).

decrease

A ____________ ____________________guarantees that the market price of the import will be the same as that of domestically produced goods. (Enter one word in each blank.)

variable levy

Which of the following are reasons that governments decide to own businesses? (Check all that apply.) Multiple select question. to ensure control over basic services to ensure equal access to public goods to protect against corruption to provide vital services such as national defense to ensure economic goals are pursued ahead of social goals

to ensure control over basic services to ensure equal access to public goods to protect against corruption to provide vital services such as national defense

Which of the following are reasons for the government to privatize a business? (Check all that apply.) Multiple select question. to ensure equal access to public goods to ensure that a business runs more efficiently to raise money to reduce the size of government

to ensure that a business runs more efficiently to raise money to reduce the size of government

Which of the following are reasons why governments nationalize private firms? (Check all that apply.) Multiple select question. to reduce the extent of bureaucracy to extract more money from the firms to increase profitability to control an earlier investment in a firm to follow an economic or political ideology

to extract more money from the firms to increase profitability to control an earlier investment in a firm to follow an economic or political ideology

Which of the following are reasons that governments decide to own businesses? (Check all that apply.) Multiple select question. to ensure economic goals are pursued ahead of social goals to protect against corruption to ensure equal access to public goods to ensure control over basic services to provide vital services such as national defense

to protect against corruption to ensure equal access to public goods to ensure control over basic services to provide vital services such as national defense

Which of the following are reasons for the government to privatize a business? (Check all that apply.) Multiple select question. to reduce the size of government to raise money to ensure that a business runs more efficiently to ensure equal access to public goods

to reduce the size of government to raise money to ensure that a business runs more efficiently

Advocates for the protection of an infant industry claim that firms need protection from imports until they Blank______. (Check all that apply.) Multiple select question. achieve economies of scale train the labor force obtain the required investment capital master production techniques obtain all the factors of production

train the labor force achieve economies of scale master production techniques obtain the required investment capital