Global Business - FVC1 (All of the Practice Quizzes in MindTap), FVC1 Global Business V2 Pre-Assessment, WGU Global Business FVC1 V2 and D080 Module 1-4

Centralized manufacturing

A company located in the United States ships its products to a country overseas. Frequent bad weather causes significant delays, thus leading to reduced profits. As a result, the company wants to encourage leadership to consider adding a location in this overseas country. Which strategy solves this problem?

Clean Water Act

A company paid millions of dollars to a government in reparation for an oil spill. Which law did the company breach?

Country B seeks to protect its economy and give it the opportunity for long-term expansion.

A company that is located in Country A would like to sell products in Country B. The government of Country B is pushing for a tariff-based international trade agreement on the product. What is the reasoning behind Country B's decision?

What are Multinational Corporations (MNC)?

A company that operates in two or more countries. Corporations that move resources, goods, services, and skills across national boundaries without regard to the country in which their headquarters are located

Subsidiary

A company wants to hold a direct operating presence in a foreign country, so it buys a company in the target country and runs the operations. Which type of business agreement is this company using?

Set an internal forward rate

A company wants to reduce the effects of currency fluctuations with its host country subsidiaries for the coming year. Which type of action should the company take?

Engage stakeholders on the issue of air quality

A company would like to expand its corporate social responsibility (CSR) initiatives to a global level. Which strategy should the company use to meet this goal?

Lean manufacturing

A computer technology company has several factories in Countries A, B, and C. The headquarters introduces steps in the manufacturing process so that waste decreases dramatically, and this reduces production costs. Which supply chain practice is the company using to optimize production efficiency?

The globalization process is at a disadvantage as the country has a lower standard of living.

A country has a characteristic traditional economic system with poor infrastructure and limited economic opportunity. What is the impact of this system on the process of globalization?

Dividend repatriation

A country wants to develop an international relationship with another country for future investments, allowing new foreign investors entitlement to a five-year tax holiday. Which benefit leads to foreign direct investment (FDI) in this situation?

The currency in Country A is strong relative to the currency in Country B.

A firm based in Country A manufactures its products in Country B and pays the manufacturing employees in the currency in which they are located. Which currency situation will result in the maximum profit for the firm?

Cloud-based file share

A global company wants to share and store business information online 24/7 for employees so they can access the items when they are not physically in the office. Which tool should the company use for this purpose?

Process

A global furniture company has three departments: lumber cutting and treatment, furniture finishing, and shipping. Which type of departmentalization does this company use?

GAAP

A manufacturing company in the United States acquired a small national supplier based in California. Which accounting method should the company use to record the acquisition?

Machines become familiar with common defects in products.

A manufacturing facility would like to consider the use of artificial intelligence deep learning. Which practice illustrates the use of this approach?

Virtual private network

A marketing manager of a company based in the United States is traveling to China to hold meetings with the company's manufacturing partners. While in China, the marketing manager realizes the internet is not allowing access to the social media platforms the manager uses to speak with family back home. Which piece of technology must the manager install and access prior to arriving in China to have that form of communication available?

Started to produce its own shows to be telecast on its channel

A movie rental company has expanded its business by vertical integration. Which action has the company taken?

Costs of transporting goods is high.

A multinational beverage company decides to export products into a new market in order to grow its business. Exporting products was determined to be one of the cheapest methods of market entry for this company; however, the company realizes there are some disadvantages to exporting. Which challenge is this company likely facing by exporting its products?

Patent

A multinational company forms a joint venture revealing some of its invented production processes to the host national company. What should this company use to mitigate theft of its production processes?

Lowered profit

A multinational company uses transfer pricing to reduce its tax burden in the subsidiaries' countries. Which effect does this action have on subsidiaries?

Inefficient decision-making

A multinational corporation (MNC) that sells consumer products and is headquartered in the United States is planning to establish a new office in India. The MNC wants to ensure that final product plans for the market in India require approval by the U.S. executive leadership team. What is a result of using this structure in India?

Temporal

A multinational firm decides to use the rates of exchange when purchases and liabilities occurred in the host countries when the company prepares its financial statements. Which method did the company use for their financial statements?

1

A new start-up company wants to connect directly with its consumers. How many layers of intermediaries should the company consider?

Chief information officer (CIO)

A roundtable discussion of senior executives is conducted in order to establish a procedure for big data. The individual responsible for managing all data resources promises to provide reports at the next meeting. Which individual will be providing this data?

The senior manager would be given a very favorable performance evaluation.

A senior manager from the head office of a company based in the United States is assigned to work in its overseas office in Indonesia where significant emphasis is placed on workplace harmony. The manager ensures that the local culture and language is understood and is often perceived as an insider who follows the normal traditions. How will the cultural dimensions of the local country influence the manager's evaluation?

The ________ system is a system which has two principal objectives: 1) to provide all the financial information needed internally by management for business decision making, and 2) to provide financial information to various external users concerned with the financial activities of the organization. a. financial accounting b. accounting information c. generally accepted d. management accounting e. net value

Ch. 15 - B

________ audits are generally concerned with evaluating the economy and the efficiency with which scarce resources are used. a. Domestic b. Internal c. International d. External e. Environmental

Ch. 15 - B

The principles by which financial statements are prepared are called ________. a. CPAP b. GIIP c. GAAP d. ASEAN e. SFAS

Ch. 15 - C

Complete the following equation: Debt Ratio = Total Liabilities/________. a. Income b. Cash Flows c. Net Profit d. Total Assets e. Losses

Ch. 15 - D

The recording, summarizing, and reporting of the economic activities and events of an organization is known as ________. a. tracking b. governance c. numbering d. economizing e. accounting

Ch. 15 - E

Which of the following is NOT a type of tax that MNC's must pay? a. Sales b. Goods and services c. Value-added d. Income e. Social

Ch. 15 - E

________ refers to a set of international accounting standards stating how particular types of transactions and other events should be reported in financial statements. a. PAWS b. SFAS c. GAAP d. IASB e. IFRS

Ch. 15 - E

The Organization for Economic Cooperation and Development is an international organization of 30 countries that accept the principles of representative democracy and free market economy. a. True b. False

Ch. 15 - False

The component of the accounting information system that provides financial information needed by external users such as investors and lenders is referred to as management accounting. a. True b. False

Ch. 15 - False

A lender will specify minimum certain current ratio requirements to maintain the loan. This is an example of debt covenants. a. True b. False

Ch. 15 - True

International Financial Reporting Standards (IFRS) are a set of international accounting standards stating how particular types of transactions and other events should be reported in financial statements. a. True b. False

Ch. 15 - True

The most important financial statements are the income statement, statement of retained earnings, balance sheet, and statement of cash flows. a. True b. False

Ch. 15 - True

All commercial transactions, both private and public between nations of the world, are referred to as ________. a. environmental business b. national business c. international business d. in-border business e. domestic business

Ch. 2 - C

At the end of WWII, three major international organizations were established to accelerate trade and economic growth among countries of the world. They are: the IMF, the World Bank, and ________. a. NAFTA b. MFN c. VER d. GATT e. QR

Ch. 2 - D

The earliest and simplest form of international business is ________. a. a partnership b. a joint venture c. a sole proprietorship d. angel investing e. trade

Ch. 2 - E

________ is a theory of international trade that supports the premise that a nation could only gain from trade if it had a trade surplus. a. Theory X b. Theory Y c. Theory Z d. Factors of production e. Mercantilism

Ch. 2 - E

Among middle-income countries, China, has been consistently attracting the largest amount of FDI because of its well-developed infrastructure and its emerging position as the low-cost manufacturing center of the world. a. True b. False

Ch. 2 - True

In countertrade, an exporter of goods or services to another country commits to import goods or services of corresponding value from that country. a. True b. False

Ch. 2 - True

Trade policy refers to all government actions that seek to alter the free flow of merchandise or services from or to a country. a. True b. False

Ch. 2 - True

A market formed when member countries of a customs union remove all barriers to allow the movement of capital and labor within the customs unions is known as a(n) ________. a. common market b. political union c. free trade area d. economic union e. customs union

Ch. 3 - A

According to the text, which is NOT a country with large home markets and also located far from world markets? a. Tanzania b. Thailand c. Zimbabwe d. Argentina e. Paraguay

Ch. 3 - C

n what year was ASEAN established? a. 1952 b. 1900 c. 1967 d. 1925 e. 2001

Ch. 3 - C

According to the text, how many stages are there to regional integration? a. Two b. Five c. Six d. Four e. Three

Ch. 3 - D

NAFTA is a comprehensive free-trade agreement among Canada, the United States, and ________. a. Cuba b. Australia c. China d. Mexico e. Japan

Ch. 3 - D

According to the text, all of the following are EU member states EXCEPT: a. Malta. b. Denmark. c. Cyprus. d. Italy. e. the Ukraine.

Ch. 3 - E

________ includes a multitude of economic and/or political steps that may be taken by member states of a union to increase their global competitiveness, including preferential trade access. a. Spatial transformations b. Economic geography c. Embargo d. Economic isolation e. Regional integration

Ch. 3 - E

A statement of account that shows all transactions between the residents of one country and the rest of the world for a given period of time is called a(n) ________. a. balance of payments b. income balance c. current account d. trade balance e. services balance

Ch. 4 - A

The price at which one currency can be converted to another currency is called the ________. a. foreign exchange market b. independent floating exchange rate system c. fixed exchange rate system d. spot market e. exchange rate

Ch. 4 - E

Over $15 trillion dollars worth of currencies are traded daily. a. True b. False

Ch. 4 - False

The current account of the BOP consists of four subaccounts: (a) trade (or goods) balance, (b) services balance, (c) financial derivatives, and (d) net imports. a. True b. False

Ch. 4 - False

________ are basic beliefs or philosophies that are pervasive in a society. a. Values b. Feelings c. Outlooks d. Manners and customs e. Attitudes

Ch. 5 - A

Of the following, which is NOT a cultural aspect of doing business in Korea? a. "We" is more important than "I." b. The left hand is viewed as "unclean." c. "Inwa" involves harmony among un-equals. d. Younger brothers and sisters are not allowed to use the names of their older siblings. e. Children are not supposed to say their parents' names, even when used with a title.

Ch. 5 - B

A U.S. federal law that consists of two parts: an anti-bribery provision and a requirement to maintain an adequate internal control system over financial books and records is the ________. a. Ethical Violations Act b. Ponzi Act c. Corruption Perceptions Act d. Foreign Corrupt Practices Act e. Integrity Perceptions Act

Ch. 7 - D

A type of fraud in which money received from later investors is used to provide returns to earlier investors, thus giving an appearance of a profitable investment, is called a(n) ________. a. mark to market scheme b. internal control scheme c. tax scheme d. Ponzi scheme e. liability scheme

Ch. 7 - D

Which year was SOX enacted? a. 1977 b. 1922 c. 1968 d. 2002 e. 1953

Ch. 7 - D

Of the following, which is NOT an area where output controls and measurement can be put into practice? a. Profits b. Productivity c. Employee turnover d. Market share e. Growth

Ch. 9 - C

Six Sigma initiatives seek to limit defects or problems to ________ per million. a. 10.2 b. 7.5 c. 3.4 d. 1.8 e. 12.3

Ch. 9 - C

Global businesses typically define their overall goals in a(n) ________. a. strategy chart b. business plan c. vision statement d. mission statement e. flow chart

Ch. 9 - D

Very short-term plans formulated for implementing strategic goals are called ________ plans. a. strategic b. intentional c. equipped d. operational e. tactical

Ch. 9 - E

Fortunately, coordinating strategy formulation and implementation is relatively very easy. a. True b. False

Ch. 9 - False

Organizational change is generally a very smooth and a well-accepted transition. a. True b. False

Ch. 9 - False

Several areas where output controls and measurement are typically put into practice include profits, growth, productivity market share, quality control, and corporate social responsibility. a. True b. False

Ch. 9 - True

Six Sigma is an example of the high value global businesses place on quality. a. True b. False

Ch. 9 - True

Walmart's "In everything we do, we're driven by a common mission: saving people money so they can live better" is an example of a mission statement. a. True b. False

Ch. 9 - True

Increases

Countries A and B participate in trade agreements that allow free trade among participant countries. However, Country A imposed quotas on several imported products to protect its domestic products. What is the effect, if any, on the domestic prices of these products?

Provide tax exemptions

Country A and Country B are trying to mend their relationship. A company from Country A would like to invest in a company in Country B. Which action by Country B will help these two countries meet their goal?

Increases economies of scale in Country A

Country A manufactures products less expensively than Country B. Due to changes in international agreements, Country B has decided to stop producing the products that Country A makes. Instead, Country B will purchase the same number of products from Country A that they would have normally produced on their own. How will this affect global trade?

Which law system can vary from community to community and is found in countries without strong formal justice systems?

Customary is generally found at the tribal or local level, is based on longstanding local customs, and is often transmitted orally.

An organizational structure that groups people together because they hold similar positions in a company, perform similar tasks, or use the same kinds of skills is called a(n) ________ structure. a. matrix b. hybrid c. product d. geographical region e. functional

Ch. 10 - E

A basic problem of the market structure is determining the responsibility and authority relationships between the functional and divisional managers. a. True b. False

Ch. 10 - False

One disadvantage of the divisional structure is that functions focus their activities upon a specific kind of product, market or geographical region. a. True b. False

Ch. 10 - False

A basic challenge of the matrix structure is determining the responsibility and authority relationships between functional and divisional mangers. a. True b. False

Ch. 10 - True

B.N.W. Industries, Zippo Manufacturing Company, Mack Trucks, and Maglite are all examples of companies with export departments. a. True b. False

Ch. 10 - True

Lenovo, the Chinese computer manufacturer, which became a global brand in 2005 is an example of a stateless corporation. a. True b. False

Ch. 10 - True

Employee representation on corporate boards of directors is known as ________. a. co-determination b. multi-employer bargaining c. repatriation d. collective bargaining e. mediation

Ch. 11 - A

Employees who are working in countries other than their native countries are called ________. a. expatriates b. third country nationals c. host country nationals d. developers e. parent country nationals

Ch. 11 - A

Providing employees with skills specific to the job they are going to be doing is called ________. a. training b. a needs assessment c. co-determination d. repatriation e. development

Ch. 11 - A

The process of a company subcontracting a certain production function to a third party is called ________. a. outsourcing b. importing c. exporting d. franchising e. offshoring

Ch. 11 - A

Workers already living in the foreign or host country where the parent company is opening operation are known as ________. a. host country nationals b. expatriates c. parent country nationals d. developers e. third country nationals

Ch. 11 - A

Hofstede's dimension of ________ refers to the degree of equality of authority distribution in a given society and its workplaces, and employee expectations related to the same. a. uncertainty avoidance b. masculinity vs. femininity c. power distance d. long-term vs. short-term orientation e. individualism vs. collectivism

Ch. 11 - C

A formal organization representing a group or groups of employees is called a(n) ________. a. collective bargaining agreement b. collective bargaining union c. co-determination union d. repatriation agreement e. labor union

Ch. 11 - E

Hofstede's dimension of ________ involves the extent to which members of a given society value long-term and future planning as opposed to a more immediate short-term perspective. a. uncertainty avoidance b. masculinity vs. femininity c. power distance d. individualism vs. collectivism e. long-term vs. short-term orientation

Ch. 11 - E

The average CEO in the U.S. was paid ________ times more than the average employee. a. 159 b. 73 c. 200 d. 50 e. 183

Ch. 11 - E

Who wrote the book, The World Is Flat? a. Henry Ford b. Hiromu Nonaka c. Karl Marx d. William Maslow e. Thomas Friedman

Ch. 11 - E

Japan would be described by Hofstede to be a very individualistic society. a. True b. False

Ch. 11 - False

United Autoworkers Union is a product of NAACP. a. True b. False

Ch. 11 - False

Workers already living in the foreign or host country where the U.S. company is opening operations and being employed by the U.S. company are known as parent country nationals. a. True b. False

Ch. 11 - False

Expatriate failure refers to when the expatriate does not complete his or her assignment and returns home early. a. True b. False

Ch. 11 - True

In Canada, labor relations are regulated at the provincial level rather than at the national level. Such provincial regulations generally make it easier for employees to join labor unions than the federal regulatory system pertaining to labor relations, which exist in the United States. a. True b. False

Ch. 11 - True

________ had the highest per-capita GDP in 2010. a. France b. United Kingdom c. Japan d. Russia e. Quatar

Ch. 12 - A

Marketing strategies used in international markets by a company that are the same as those used in its domestic market are called ________. a. glocalization b. standardization c. a global product system d. adaptation e. marketing research

Ch. 12 - B

One major disadvantage of ________ is its high cost per contact. a. distribution b. personal selling c. advertising d. publicity e. sales promotion

Ch. 12 - B

The step in the new-product development process in which a company will develop the marketing mix for a new product is called ________. a. commercialization b. market testing c. a global product d. business analysis e. concept testing

Ch. 12 - B

A magazine that targets specific industries is called a(n) ________ publication. a. backward b. reverse c. horizontal d. vertical e. forward

Ch. 12 - D

A(n) ________ strategy refers to bypassing channels of distribution by using marketing and sales offices located in foreign countries. a. agent b. indirect c. distributor d. direct e. public

Ch. 12 - D

In the ________ stage of the product life cycle, sales reach a peak and then begin to decline as profits continue to decline. a. introduction b. growth c. decline d. maturity e. commercialization

Ch. 12 - D

The ________ market includes food, clothing, transportation, banking services, credit services, and entertainment. a. gray b. industrial c. government d. consumer e. environmental

Ch. 12 - D

Companies have ________ options to consider when marketing their products overseas. a. six b. five c. three d. two e. four

Ch. 12 - E

There are ________ major markets within each foreign market that can purchase products and services and needs to be analyzed. a. three b. two c. six d. five e. four

Ch. 12 - E

Foreign overhead is the percentage of a market potential that a specific company expects to sell in a specific international market. a. True b. False

Ch. 12 - False

The new product development process consists of concept testing, business analysis, product elimination, and commercialization. a. True b. False

Ch. 12 - False

A price that an overseas market is willing to pay is referred to as the arms length price. a. True b. False

Ch. 12 - True

Marketing strategies used in international markets by a company that are the same as those used in its domestic market represent an example of standardization. a. True b. False

Ch. 12 - True

When companies market their products and services through marketing or sales offices that they establish and maintain in the foreign markets served, it is called direct strategy. a. True b. False

Ch. 12 - True

Materials used to produce components are called ________. a. raw materials b. production facilities c. production process d. hollows e. factors of production

Ch. 13 - A

________ include(s) automobiles, airplanes, and computers. a. Goods b. Cargo c. Produce d. Supplies e. Services

Ch. 13 - A

In the production systems model, ________ may include materials, land, labor, machines and equipment. a. raw materials b. factors of production c. components d. outputs e. inputs

Ch. 13 - C

The system that businesses use to produce products is known as a(n) ________ system. a. manufacturing b. service c. production d. raw e. component

Ch. 13 - C

When a firm buys components and raw materials globally, it is called ________. a. insourcing b. dual sourcing c. global procurement d. global production e. supplying

Ch. 13 - C

When the firm doing the outsourcing and the supplier that will provide the outsourced goods and services are located in the same country, it is called ________. a. offshoring b. dual outsourcing c. domestic outsourcing d. global outsourcing e. insourcing

Ch. 13 - C

________ refers to the property of ERP systems to handle the accounting standards of multiple countries. a. Multi-currency b. Multi-culture c. Multi-national d. Multi-language e. Multi-enterprise

Ch. 13 - C

Determining if products made in-house will be produced in one or more facilities, and if these facilities should be located in one or more countries, is called a(n) ________ decision. a. offshoring b. insourcing c. scene d. location e. position

Ch. 13 - D

The linking of separate networks into an interconnected network, where each network retains its own identity is known as ________. a. multi-national networking b. global networks c. telecommunication d. internetworking e. enterprise networks

Ch. 13 - D

According to one estimate, ________ percent of a typical American manufacturing company's value-added in production and operations came from outside sources. a. 80 b. 20 c. 800 d. 40 e. 60

Ch. 13 - E

A company that only completes product design and outsources all other production process functions is referred to as a supply-chain corporation. a. True b. False

Ch. 13 - False

The form of management whose main goal is to minimize the total cost of the supply chain, and maximize the value of the product to the end user is called production management. a. True b. False

Ch. 13 - False

Determining if products made in-house will be produced in one or more facilities, and if these facilities should be located in one or more countries is called a location decision. a. True b. False

Ch. 13 - True

The make-or-buy decision involves determining which components and raw materials should be produced in-house and which components and raw materials should be acquired from suppliers. a. True b. False

Ch. 13 - True

The production process may consist of one or more transformations: physical, locational, informational, psychological, physiological, exchange, or storage. a. True b. False

Ch. 13 - True

An investor's right (but not obligation) to buy an asset at a pre-determined price is called a(n) ________. a. call option b. premium c. currency swap d. put option e. market-to-marke

Ch. 14 - A

The trading of futures contracts in major currencies and offering price transparency and efficiency in addition to elimination of counterparty risk due to guaranteed payments on contracts are called ________. a. organized exchanges b. short positions c. speculators d. long positions e. hedgers

Ch. 14 - A

Oil prices are denominated in terms of ________ in international commodities markets. a. yen b. dollars c. pesos d. pounds e. euros

Ch. 14 - B

Attempts in currencies and currency derivatives to earn profits from trading them and help to make prices efficient is called ________. a. a short position b. a market-to-market exchange c. speculating d. an organized exchange e. hedging

Ch. 14 - C

Bonds ratings are important in assuring foreign investors of their ________ . a. interest rate b. government backing c. credit quality d. dividend payment e. market demand

Ch. 14 - C

A group of banks that collectively make a loan to a firm is called a(n) ________. a. banker's acceptance b. open account c. commercial letter of credit d. syndicate e. bond rating

Ch. 14 - D

Currency swaps are often combined with ________ swaps. a. call option b. exchange rate c. premium d. interest rate e. put option

Ch. 14 - D

The required rate of return by stockholders in a firm that can be estimated by means of the Capital Asset Pricing Model is called the ________. a. cost of debt b. exchange risk beta c. cost of capital d. cost of equity e. net present value

Ch. 14 - D

When stock markets in many countries move down in concert with one another and thereby reduce international diversification benefits, it is called ________. a. domestication b. diversification c. sensitivity d. speculation e. contagion

Ch. 14 - E

________ risk is associated with the short-term effects of currency movements on the consolidated accounting statements of a firm. a. Accounting b. Economic c. Consolidated d. Transactions e. Translation

Ch. 14 - E

Society of Worldwide Interbank Financial Telecommunications (SWIFT) is an organization that provides large, wholesale dollar payment services for businesses, banks, and governments. a. True b. False

Ch. 14 - False

Futures contracts available in currencies of emerging-market countries by large banks in the OTC market are called currency forward contracts. a. True b. False

Ch. 14 - True

The impact of random change on the value of one currency with respect to other currencies is referred to as the exchange rate risk. a. True b. False

Ch. 14 - True

The practice of buying securities in a portfolio with price patterns over time that are different from one another, which reduces the volatility of the portfolio, is called diversification. a. True b. False

Ch. 14 - True

The practice of using currency derivatives to reduce potential transaction, translation, and economic risks of currency movements that could lead to losses for a firm or investor is referred to as hedging. a. True b. False

Ch. 14 - True

A(n) ________ shows the company's inflows and outflows of cash. a. statement of cash flows b. statement of retained earnings c. balance sheet d. statement of net value e. income statement

Ch. 15 - A

The component of the accounting information system that provides the financial information needed internally by external users such as investors and lenders is referred to as ________. a. financial accounting b. accounting information c. management accounting d. net value e. generally accepted

Ch. 15 - A

________ has the highest income tax rate. a. The United States b. Greece c. Finland d. Iceland e. Australia

Ch. 15 - A

They reduce domestic competition by limiting domestic companies' sales volume.

How do Congress and the Department of Agriculture use quotas to their advantage?

To decide whether to grant access to money

How do banks and investors use financial statements?

Which action could a government take to encourage a company to keep production in the country?

Imposing tariffs on items made in other countries causing them to be more expensive.

What is the Characteristics of Trade Agreements?

Treaties-must be approved by the Senate with a 2/3 vote Trade Agreements-Must be approved by both the US Senate and the house Promote trade through International Groups-Ex The GATT and The WTO -Regional Economic Integrations

It leads to developing free trade policies with strategic partners.

Two countries agree to open their borders to international business transactions with one another without tariffs. How does this affect global business?

Buying goods in a lower priced market and selling them in a higher priced market to make profits is called ________. a. the law of one price b. arbitrage c. inflation d. the big mac index e. purchasing power parity

Ch. 4 - B

The net exports of services and imports of services is known as the ________. a. financial account b. trade balance c. income balance d. balance of transfers e. services balance

Ch. 4 - B

John as an investor requires the added return for risk associated with a security or asset. This added return is would be called a(n) ________. a. services account b. investment trade transfer c. risk premium d. balance account e. financial greed

Ch. 4 - C

A patent is a distinctive phrase, name, word, picture, symbol or design, or combination of these, that identifies a given business' service or product, and is owned by said business. a. True b. False

Ch. 6 - False

Athenian democracy refers to a form of government in which citizens vote to elect given individuals to serve as their representatives for a certain period of time. a. True b. False

Ch. 6 - False

India is currently the largest nation in the world with a communist economic ideology, and it is emerging as one of the most economically powerful countries in the world. a. True b. False

Ch. 6 - False

A potential economic risk companies face doing business internationally is inflation. a. True b. False

Ch. 6 - True

There are three primary kinds of legal systems in countries throughout the world: civil law legal systems, common law legal systems, and theocratic law legal systems. a. True b. False

Ch. 6 - True

The CPI ranks ________ different countries by their perceived levels of corruption, as determined by expert assessments and opinion surveys. a. 180 b. 100 c. 50 d. 20 e. 150

Ch. 7 - A

The first step of ethical decision making is to ________. a. define all the facts and circumstances b. make the decision c. identify the people affected by the situation d. identify the alternative decisions and consequences e. determine that a decision needs to be made

Ch. 7 - A

Three philosophical principles regarding ethics include the imperative principle, the utilitarian principle, and the ________ argument. a. generalization b. essence c. governance d. integrity e. totalitarian

Ch. 7 - A

Two principles can help when making an ethical choice: the principle of consistency, and the principle of ________. a. respect b. morality c. justice d. fairness e. integrity

Ch. 7 - A

Parmalat, an Italian-based multinational corporation, is recognized as a leader in quality control and employee benefits. a. True b. False

Ch. 7 - False

The CPI ranks 180 countries and provides a measurement of the potential travel risk per country. a. True b. False

Ch. 7 - False

The principle of consistency dictates that because everyone is doing something on a consistent basis it is ethical. a. True b. False

Ch. 7 - False

The five basic threats to security are natural disasters, dishonest employees, disgruntled employees, persons external to the organization, and accidental errors or omissions. a. True b. False

Ch. 7 - True

The three philosophical principles regarding ethics include the imperative principle, the utilitarian principle, and the generalization argument. a. True b. False

Ch. 7 - True

Factor price equalization is a theory of international trade that supports the premise that a nation could only gain from trade if it had a trade surplus. a. True b. False

Ch. 2 - False

Unfortunately, research finds that the losses from open trade and investment are always greater than the gains. a. True b. False

Ch. 2 - False

When a country imports more than it exports, it has a(n) ________. a. trade balance b. income balance c. net transfer d. financial account e. trade deficit

Ch. 4 - E

A person of integrity has ________ essential characteristics. a. five b. two c. six d. four e. three

Ch. 7 - B

What is the 5th stage of going Global

(creation of new markets), the focus is on market expansion.

What is the 2nd stage of going Global

(product specialization), companies transfer the full production process of a particular product to a single, low-cost location and export the goods to various consumer markets.

What is the 3rd stage of going Global

(value chain disaggregation) represents the next step in the company's globalization of the supply chain infrastructure; companies disaggregate the production process and focus on completing each activity in the most advantageous location.

What is the 4th stage of going Global

(value chain reengineering), companies seek to further increase their cost savings by reengineering their processes to suit local market conditions by substituting lower cost labor for capital.

Value-to-weight ratio

A company is evaluating where it will locate its next facility to minimize its distribution shipping costs. Which factor must the company consider as part of this decision?

What is the Role and Influence of The World Bank?

-5 constituent institutions aimed at restructuring economies, promoting investment, and reducing poverty. -Provides long term loans used for development projects. -Provides economic and technical advice. -Promotes FDI by facilitating foreign and domestic partnerships -Offers insurance against noncommercial and political risk. -Helps resolve disputes related to foreign direct investments (FDI).

Political systems that impact Globalization-Oligarchy

-A small, elite group holds power -Acheive power due to military, economic or other powers Ex-Russia

Cons of Globalization

-Benefits the rich at the expense of the poor -Job loss in developed countries -Environmental damage and unethical practices of labor -Loss of power of local government

What is the criticisms of the IMF?

-Conditionality causes the citizens of the borrowing country to pay a heavy price. -IMF policies are significantly impacted by the rich companies. -Imbalance of voting power

Pros of Globalization

-Economic Growth -Increased well-being of human society -increased trade and investment

What is the Role and Influence of The World Trade Organization (WTO)?

-Encourages international trade through the lowering of trade barriers. -Expanded through successive negotiations called "rounds". -A forum for negotiations to reduce tariff and non-tariff barriers to trade -Oversees trade agreements and facilitates disputes between member countries. -Promotes equality among trading partners and works to promote fair competition in the market. -Provides technical assistance to emerging economies so they can become competitive with more advance economies.

Political systems that impact Globalization-Democracy

-Equal Voice or vote in determining state policy

Challenges of Global Expansion

-Ethical business concerns -Organizational structure -Public Relations -Leadership -Legal and regulatory structure

Why do governments promote FDI?

-Expand their domestic economy -attract new technologies, business knowledge, and capital

What is H-O Theory (factor propositions)?

-Factors of production: Labor, Land, natural resources, capital and technology. -Ex. States that the reason Brazil is better with coffee and the US with corn is because of what we have to work with in each country.

How governments promote FDI?

-Financial Incentives: provide a combination of insurance, loans, and tax breaks. -Improve or enhance local infrastructure -By reducing bureaucracy and regulatory requirements -Human capital development: Improve their workforce through education and job training -Reduce uncertainty: reassure businesses that the local operating conditions are stable, transparent (i.e., policies are clearly stated and in the public domain), and unlikely to change. -

Blockchain

A company is interested in working with the technology that will allow consumers to privately and securely store personal information such as social security and credit card numbers, making it accessible around the world. Which piece of technology is of interest to this company?

What is Country Similarity Theory?

-Firm based theory that incorporate other product and service factors into the understanding of trade flows. -Consumers in countries that are in the same or similar stage of development would have similar preferences. -Companies first produce for domestic consumption. When they explore exporting, companies often find that markets that look similar to their domestic one, in terms of customer preferences, offer the most for potential success.

What is the criticisms of The World Bank?

-Imbalance in the leadership -Enforced conditionality causes harm to developing countries. -Privatization of Healthcare. -Environmental damage caused by funded projects,

What are the types of Tariffs

-Import tariffs-Taxes on goods that are imported into a country -Export tariffs-Taxes on goods leaving a country -Protective tariffs-protect a domestic industry by making imported goods more expensive than equivalent goods produced domestically -Revenue tariffs-levied to raise revenue for the government -Specific tariffs-Import taxes expressed in an amount of money per unit imported -Ad valorem tariffs-Import taxes based on a fixed percentage of the assessed commercial value of imported goods -Compound tariffs-Taxes on imported goods that are a combination of a fixed amount and an amount based on the value of the goods

Module 2: Shaping the Economic Environment What is the Role and Influence of the International Monetary Fund (IMF)?

-It oversees the stability of the international monetary system. -Monitoring economic activity around the globe -Advising countries to adopt policies that are linked to a stable and growing economy -Provides technical assistance to help with creating monetary and financial policies and to promote sound fiscal policy and management. -Makes short term loans to deal with debt and financial crises as well as to correct balance of payment problems and maintain exchange rate stability.

What is Comparative Advantage Trade Theory?

-Limited resources lead to opportunity cost. -Lower opportunity cost determines comparative advantage. -Ex Brazil is giving up fewer opportunities that the US to produce coffee and the US has a lower opportunity cost for producing corn, than Brazil. What should they do?

Political systems that impact Globalization-Dictatorship

-Power is held by a single person (or a very small group of people) who wields complete and absolute authority over a government and population. -Ex Libya

Why do governments restrict FDI?

-Protect local industries and critical resources (petroleum, minerals, metals) -Preserve national and local culture -Maintain political and economic independence and control economic growth

What are reasons for limiting trade?

-Sanctions -dumping-When a country or company exports a product at a price that is below market price to gain an unfair share of the market -Infant Industry Argument -Health and Safety

Why do countries trade?

-Trade creates win win situation for both exporting and importing countries -Trade promotes economic development and increase living standard -Specialization and economies of scale

What is the criticisms of The WTO?

-Transparency requirement hurts national sovereignty. -The trade rules protect developed countries more than developing countries. -The MFN rule give MNCs an unfair advantage. -Agriculture product subsidy hurt developing countries. -The WTO has refused to address the impacts of free trade on labor rights. -Has been ignoring environmental concerns.

What is the Impact of Trade?

-With free trade: -Possible job loss in certain industries -Trade affects Wages -Labor standards and working conditions are concerned

What is Global Strategic Rivalry Theory?

-focuses on firm's competitive advantage -Barriers to entry

What are the 3 Legal Systems that Impact Globalization?

1. Civil Law-The judge applies the law code; inquisitorial system where the investigating judge investigates the facts of the case. Juries are rarely used. 2. Common Law-The judge interprets the law; judges interpret the law, and judicial rulings can set precedent.2 Common law systems are often adversarial because the judge's role is to act as a moderator between two opposing parties. A jury may determine the facts, and a judge decides which law will be applied to the case. 3. Religious Law-based on religious guidelines

What is the Cage analysis by Ghemawat?

1. Culture: cultural differences between two countries reduce their economic exchange 2. Administration: the greater the administrative differences between nations, the more difficult the trading relationship is to acquire—whether at the national or corporate level. 3. · Geography is perhaps the most clear difference between countries. Generally, as distance goes up, trade goes down, since distance usually increases the cost of transportation. 4. Economics: The most apparent economic difference between countries is size (compared with GDP: a measure of the goods produced and services provided by a country in one year). Another difference is per capita income.

What are the types of FDI?

1. Horizontal FDI: When a company is trying to open a new market-a retailer, for ex, that builds a store in a new country to sell to the local market. 2. Vertical FDI: when a company invests internationally to provide input into its core operations-usually in its home country. -backward vertical FDI: when a firm brings the goods or components back to its home country (ex acting as a supplier) -forward vertical FDI: when a firm sells the goods or components in the local or regional market (ex acting as a distributor) 3. greenfield-A new business built where no prior business existed, either physically or metaphorically or both 4. Brownfield-when MNC enter into host countries by purchasing or leasing existing facilities

4 Industry Globalization Drivers

1. Market Opportunities - opportunity for scale and scope; Convergence of needs 2.Cost Drivers-Economies of scale and scope; Exploiting cost of factors of production 3. Competitive Drivers- New Markets and increased level of trade 4. Government Drivers- Favorable Policies; Support for industries

What are the 4 Economic Systems that Impact Globalization

1. Traditional - Centered around family;everyone consumes the same good; relies on bartering; no surplus 2. Command-Controlled by the ruling class; all resources are owned by the government 3. Market- The market controls the dist of resources; no government control 4. Mixed-The market is the major determining power;partial government regulates as needed

What is the World is Flat Theory by Friedman?

10 factors had influential roles in making the world smaller, but each worked in isolation until, the convergence of three more powerful forces: new software and increased public familiarity with the internet, the incorporation of that knowledge into business and personal communication, and the market influx of billions of people from Asia and the former Soviet Union who want to become more prosperous quickly.

Globalization 1.0

1st Stage of globalism started with Columbus's discovery of the New World and continued from 1492 to about 1800 and is pushed forward by nationalism and religion.

Globalization 2.0

2nd stage of globalization 1800 to 2000, was disrupted by the Great Depression and both world wars and was largely shaped by the emerging power of huge MNCs and is characterized by advances in methods of transportation.

Globalization 3.0

3rd stage of globalization began around 2000 and is characterized by advancements across the board, especially technology and communication.

Central America Free Trade Agreement

A U.S. capital investment firm is researching new markets to enter to diversify its portfolio. The director of foreign investments presented a pitch to the board of directors encouraging entry into the Costa Rican telecommunications market by investing in local companies in the region through acquisition. Which alliance supports this director's suggestion?

Increase shareholder trust via high ethical standards

A business is entering a global market at the same time it has been trying to improve its level of corporate social responsibility (CSR). Which CSR goal should this company remember during this process?

Empowerment

A community has the skills and ability to access computers and the internet but does not value that form of technology. A company is trying to change the situation in order to facilitate increased online transactions. Which stage of the digital divide is the company hoping to correct?

Standardization

A company has entered several foreign markets and maintains the same branding in all of them. What is the term for this marketing strategy?

Australia

A company headquartered in the United States is considering expanding its activities into a different country that follows the same legal system as most states in the United States. Which country is suited for this expansion?

Discomfort due to changes in customs and traditions

An employee for a global technology company was assigned to its overseas office in Asia. Once the assignment was completed, the employee experienced disorientation after returning to the head office in the United States. What caused this disorientation?

Protocol

An employee has recently accepted an assignment in a company's foreign office. Human resources (HR) helps prepare this employee for the transfer by explaining the cultural business behaviors in the new location. Which area should HR focus on to accomplish this goal?

National Environmental Policy Act

An environmental consultant is advising a large oil drilling business in the United States. The consultant reminds the business of its obligations to create and maintain conditions so a healthful environment can be ensured for all people. Which specific act of the United States government is being referenced by the consultant?

Ethical behaviors are not standardized across the world.

An individual is encouraged to provide a small, quiet fee to local officials to get some critical work done overseas for a global office. The individual was told that this would greatly expedite the work. The individual took that advice, and the work was completed, but the manager in the United States was upset with the action and called the individual to discuss the matter. What is the most challenging aspect of this individual's ethical dilemma?

What are the benefits of FDI?

An inflow of capital can benefit both the global and host country economy. -Increased jobs and reduced poverty -Improved human capital development -increased tax revenues Invested capital goes to businesses with the highest potential for growth. Investors can decrease their risk by diversifying. Investing capital in firms can lead to growth and subsequently increased jobs.

Functional

An international company has employees divided into departments related to designated areas of the business, such as marketing, production, human resources, information technology, and customer service. What is the organizational structure of this company?

Education

An international company works with many economic sectors and notices that one sector in particular is slower to adopt artificial intelligence, which limits their opportunities on a global scale. Which economic sector shows this slower pace?

Decreased profitability

An international company's consumers are demanding that the owners make socially ethical business decisions concerning their packaging, but the company is finding that the suggested green modifications are increasing the costs of producing the product. Which concern is this company facing by meeting these ethical demands?

What is a portfolio investment?

An investment in another country is purely financial and does not involve any management responsibility

Greenfield venture

As a company enters a foreign market, it provides assets, takes on all of the responsibility, and assumes significant risk. ​ What is this market entry strategy?

The first step a domestic firm takes when entering the global arena is usually to ________. a. import products from other companies b. franchise c. form a joint alliance d. export some of its products e. become licensed

Ch. 10 - D

An organizational structure in which people are grouped simultaneously by function and by division is known as a(n) ________ structure. a. product b. functional c. market d. geographical region e. matrix

Ch. 10 - E

Module 3: International Agreements What is Mercantilism Trade Theory?

Can only gain with a trade surplus-more export/less import ("I sold more goods to the rest of the world than I bought from the rest of the world, so I win with trade") Gold and Silver are important to a country's wealth. An economic system where the government regulates trade for its own benefit at the expense of its rivals.

A tool that people use to coordinate their actions to obtain something they seek or value is known as ________. a. leading b. control c. organization d. structuring e. managing

Ch. 10 - A

________ refers to a new phase in the evolution of the multinational corporation, where work is sourced wherever it is most efficient and the corporation transcends nationality altogether. a. Organization b. Stateless corporation c. Organizational structure d. Division e. Global business

Ch. 10 - B

A ________ is a particular kind of the divisional structure where products are grouped into separate divisions according to the needs of different customers. a. product b. matrix c. market d. geographical region e. hybrid

Ch. 10 - C

According to C.K. Prahalad, the second stage of globalization is ________. a. when multinational companies headquarter in their home country b. when companies produce goods in one country and export them to other countries c. when global businesses establish foreign subsidiaries to handle the exports from their home countries d. when global firms set up operations in other countries e. when stateless corporations locate their core corporate functions and top executives in different countries

Ch. 10 - C

All of the following are organizational structures for global businesses EXCEPT: a. functional. b. matrix. c. horizontal. d. hybrid. e. divisional

Ch. 10 - C

An organizational structure in which functions are grouped together to serve the needs of products, markets, or geographical reasons is called a(n) ________ structure. a. hybrid b. product c. divisional d. functional e. geographical region

Ch. 10 - C

A combination of different structures is known as a(n) ________ structure. a. product b. market c. matrix d. hybrid e. geographical region

Ch. 10 - D

Of the following statements about Parmalat, which is NOT true? a. By 2003, the company was no longer to pay off debts and make bond payments. b. By 2001, the company's new operations were losing money. c. It became the world's leading company in production of UHT milk. d. The company's use of derivatives facilitated efforts to disguise the extent of the company's financial liabilities and losses. e. When the company officially entered bankruptcy, the Italian government used illegal means to save the trademark.

Ch. 7 - E

The human trafficking business earns about $ ____ a year. a. 15 million b. 3.8 trillion c. 420 billion d. 500 thousand e. 30 billion

Ch. 7 - E

________ advantages relate to the economic, political, and social systems of a particular country. a. Locational, or country-specific, b. Ownership, or firm specific, c. Externalized d. Internalization e. Environmental

Ch. 8 - A

________ is a relatively low-risk operation that involves penetrating foreign markets or importing merchandise at competitive prices for domestic consumption. a. Export-import business b. Joint venture c. Foreign acquisition d. Franchise e. License

Ch. 8 - A

Of the following, which is NOT a way in which MNEs can enter foreign markets? a. Licensing b. Domesticating c. Acquiring d. Exporting e. Franchising

Ch. 8 - B

The most profitable way for foreign firms to enter trade-restricted markets is through ________. a. exporting b. FDI c. licensing d. importing e. franchising

Ch. 8 - B

The potential financial loss that entrepreneurs are willing to take in a business is reflected in their ________. a. SWOT analysis b. risk profile c. threat analysis d. money profile e. money management analysis

Ch. 8 - B

When new facilities are built and operated overseas that require large investment of capital because these new establishments are tailored to the exact needs of the home country firm, it is called a(n) ________. a. foreign acquisition b. subsidiary c. strategic alliance d. exporting e. multinational enterprise

Ch. 8 - B

McDonald's, Burger King, Pizza Hut, KFC, Subway, and Starbucks are examples of ________. a. an export-import business b. a joint venture c. franchises d. licenses e. a foreign acquisition

Ch. 8 - C

Which of the following companies is the largest in the world in terms of 2010 market value/capitalization? a. Chevron b. Apple c. Exxon Mobil d. Microsoft e. Royal Dutch Shell

Ch. 8 - C

Stable, high-income economies include all of the following EXCEPT: a. Canada b. the United States c. European Union d. Mexico e. Japan

Ch. 8 - D

The U.S. government has set up the ________ Network, which is a network of domestic and international partners. a. International Strategy b. Export-import c. FDI d. Global Technology e. Worldwide Knowledge

Ch. 8 - D

The product life cycle theory consists of 4 stages; the introduction stage, the growth stage, the acceleration stage, and the maturity stage. a. True b. False

Ch. 8 - False

A challenge strategic alliances face is that any member could prematurely quit the alliance, thereby negatively affecting some or all of the other partners. a. True b. False

Ch. 8 - True

Firms can conduct export-import business with as little as three or four employees. a. True b. False

Ch. 8 - True

Some of the biggest costs of FDI are exploitation of the environment, exploitation of low cost labor, lack of corporate social responsibility, and political interference of MNEs. a. True b. False

Ch. 8 - True

The success of Brazil and China are excellent examples of the high value MNEs place on minimizing factor input costs. a. True b. False

Ch. 8 - True

Many times, organizational change in a business is most effective when pushed from ________. a. top management b. middle management c. line managers d. supervisors e. bottom management

Ch. 9 - A

Organizations that implement basic market strategies of concentrating upon existing operations and defending their home turfs are called ________. a. defenders b. reactors c. prospectors d. analyzers e. coordinators

Ch. 9 - A

Raymond E. Miles and Charles C. Snow developed a ________-part typology describing how global (and other) businesses engage in strategy implementation on a longer-term basis. a. three b. four c. five d. six e. two

Ch. 9 - B

Systems of rules and regulations promulgated within a global business are called ________ controls. a. intrapersonal b. bureaucratic c. input d. output e. interpersonal

Ch. 9 - B

The ________ model of strategy formulation operates from the premise that the key strategic purpose of a business is to maximize financial returns for its owners. a. supplier b. shareholder c. environmental d. stakeholder e. global

Ch. 9 - B

Knowledge that is informal in nature and difficult to communicate is called ________ knowledge. a. working b. stored c. tacit d. explicit e. absorptive

Ch. 9 - C

What is Neo-mercantilism?

Modern day thinking-Countries promote a combination of protectionist policies and restrictions and domestic industry subsidies.

What is an example of competition drivers?

Entering new markets to beat competitors and identifying a market that does not have a lot of competition since it is a fairly new market.

Influence of free trade policies on labor rights

For which concern has the World Trade Organization been criticized?

What are the drawbacks of FDI?

Foreign ownership of strategically important industries could lower the competitive advantage of the nation (petroleum). Foreign investors could also take advantage of the company they are investing in and take away all valuable assets then leave the country (mining). Job losses to host countries that have cheaper labor cost.

Anarchy

In which political system do individuals control all political activity, which eliminates the government creating any laws to help businesses with their globalization efforts?

What is Economic globalization?

It is the globalization of production, sales, and finance activities in international markets around the world.

What is one of the concern of outsourcing manufacturing?

Labor can be cheaper in other countries and could lead to job loss in the home country.

Benefits of Global Expansion

Larger Markets Lower Costs Advanced technologies

What is the 1st stages of going Global

Market Entry-Companies enter new countries using business models similar to the ones deployed in their home markets.

What are the cultural effects of globalization

Transmission of ideas, meanings, and values around the world.

Political systems that impact Globalization-Monarchy

Monarchy -single person rules until they dies or abdicates the throne. -claims the rights to the title by hereditary succession or as a result of a religious, or divine, appointment or calling. -the monarchies of most modern nations are ceremonial remnants of tradition, and individuals who hold titles in such sovereignties are often aristocratic figureheads. Absolute monarchies-Ex Oman -absolute or unmitigated power -most modern are in the Middle East and Africa. -citizens who live under the reign of an absolute ruler must contend with oppressive or unfair policies that are in place based on the unchecked ideas or political agendas of that leader Constitutional monarchies-Ex Great Britain;Canada -Today's common Monarchy -abide by the laws of a greater constitution. Most evolved from absolute monarchies. -feature elected prime ministers run the country; Monarchs have limited authority

What are the different forms of international business

Organizations Government Organizations NGOs (Non-Government Org)

Module 4: Relationships, Foreign Investment, and Trade What is FDI?

Primary a long-term strategy of investing in a foreign market through direct involvement in the operations of a company, either by acquisition or partnership or by creating a new business

What are the political effects of globalization

Recue the importance of nation-states NGOs

What is International Business

Relates to any situation where the production or dist og goods and svcs crosses country borders Opportunity is boosted in globalization as trade and investment barriers are reduced

Which accommodation should an American multinational company make to conduct business in China?

Restrictions of Freedom of Speech

Almost half of all automobile parts must be made by a labor force that earns a minimum of $16 per hour by 2023.

The United States-Mexico- Canada Agreement (USMCA), a modification of the North American Free Trade Agreement (NAFTA), broadened the scope of free-trade between member nations and tightened restrictions in the region. Which regulation was established by this new agreement?

Which economic system facilitates the global expansion that uses the law of supply and demand, goods are privately owned, and government interference is minimum.

This applies to the market economy,

What are the economic effects of globalization

Trade Investment Information Technology

How does the government limit trade?

Trade barriers: tariffs-A tax or duty to be paid on a particular class of imports or exports quotas-A limited quantity of a particular product that can be produced, exported, or imported under official controls

Loss of manufacturing jobs

What is a major drawback to the home country when companies outsource manufacturing jobs to countries with lower worker wages?

It r educes up-front costs with the use of an existing channel.

What is an advantage of using intermediaries in an indirect distribution channel?

Economic opportunity

What is enhanced when creating regional trade agreements?

Improving quality of life

What is the current focus of the World Bank?

Reduced cost through lower wages

What is the primary factor that a company considers when deciding to offshore some or all of its operations?

To restrict international trade

What is the purpose of a country that has a new economy implementing trade protectionism in relation to countries with more developed economies?

To end frequent wars between neighboring countries

What was the original reason for the creation of the European Union in 1950?

What is Absolute Trade Theory?

When a country can produce more of one item than another one. Specialization determined by absolute advantage to increase production efficiency.

Reducing tax rates

Which approach is used by countries to increase the attractiveness of foreign direct investment?

Exporting

Which entry strategy offers the least amount of risk for a company entering a foreign market?

Control of natural resources

Which factor contributes to the creation of a monopoly?

Reduced trade barriers

Which factor results in a higher rate of globalization?

It forbids charging interest.

Which impact does Islamic law directly have on businesses?

International Monetary Fund

Which institution helps to maintain liquidity of global funding?

Anti-trust

Which laws are violated by practices such as price-fixing, price discrimination, restraints, and monopolization?

Individualistic

Which national cultural dimension in global business refers to people's inclination to take care of themselves and their close circle of family and friends, often at the cost of the whole society?

Uncertainty avoidance

Which national cultural dimension in global business refers to the amount of ambiguity a society is willing to accept?

Power distance

Which national cultural dimension refers to how agreeably a society accepts hierarchical differences between people in the global workplace?

Creation of isolationist policies

Which negative outcome on political systems comes from globalization?

Teams

Which organizational structure helps increase employee creativity, productivity, and mutual accountability?

Matrix

Which organizational structure is common in international high-tech and engineering firms that have projects of limited lengths of time where employees can be put on different teams to maximize ingenuity?

Privatization

Which structural adjustment of the International Monetary Fund gives to citizen owners businesses that were previously owned by the state?

Developing countries have not been satisfied with the proposed reductions in agricultural tariffs.

Why has the Doha Round of the General Agreement on Tariffs and Trade (GATT) been inconclusive?

What are the types of Quota?

absolute quota-strictly limits the quantity of goods that may enter a country tariff-rate quota-permits a specified quantity of imported goods to enter a country at a reduced rate during the quota period

Which type of law system is based on a code and focuses on how the law is applied to the facts?

civil law system is an inquisitorial system where the judge investigates the facts of the case.

Which law is based on tradition and precedent given that judicial rulings can stand as precedents for future cases?

common law systems, judges hear arguments from both parties and make a judgment. This judgment stands as precedent for future cases.

In which law system does a judge decide the applicable law for the case as a jury determines the facts?

common law systems, while a jury may determine the facts, a judge decides which law will be applied to the case.

What is globalization?

i international integration arises from the interchange of world views, products, ideas, and other aspects of culture.

The International Development Association performs which of the following functions? a. Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing foreign aid funds provided by rich nation members b. Provides political risk coverage for private investments made in developing countries c. Works on issues related to foreign investment disputes d. Supports reconstruction and restructuring of member countries utilizing funds raised in international capital markets e. Provide loans and take equity position in private companies of developing countries and works toward developing capital markets in those economies

Ch. 1 - A

Economic policy changes that promote private sector development, competitive markets, market-pricing, freer trade, and deregulation is (are) called economic ________. a. developments b. reforms c. reounts d. trade regulations e. altercations

Ch. 1 - B

In USA, there are national laws aimed at maintaining competition in all sectors of the economy and preventing monopolistic behavior of firms. These are called ________ laws. a. accountability b. antitrust c. transparency d. SWOT e. emerging market

Ch. 1 - B

The period of transformation that adjusts lifestyles to make the Internet and wireless technologies part of everyday life is called ________. a. bandwith b. the digital era c. the digital divide d. Y2K time e. the technological adjustment period

Ch. 1 - B

Which of the following is NOT a developmental institution closely associated with the World Bank? a. IDA b. OEDC c. IBRD d. IFC e. MIGA

Ch. 1 - B

OECD refers to which of the following? a. OPEC Equal Country Development b. Organization for Excellent Country Diversity c. Organization for Economic Cooperation and Development d. Outside Economic Country Diversity e. Outside Economic Country Development

Ch. 1 - C

Economic development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs, whether environmentally, socially, o economically is referred to as ________ development. a. moral b. green c. next-generation d. sustainable e. ethical

Ch. 1 - D

The dawn of globalization can be traced back to the ________ century. a. 16th b. 20th c. 21st d. 15th e. 18th

Ch. 1 - D

Which of the following is a major global concern, especially to international organizations such as the International Monetary Fund, the World Bank, and the World Trade Organization? a. The increase in the number of humans inhabiting the planet b. Lack of adequate amounts of drinking water in underdeveloped countries c. The spread of the AIDS virus d. Nationalist or protectionist policies that curtail world trade e. Lack of adequate supplies of food in underdeveloped countries

Ch. 1 - D

The international institution that facilitates the global system of exchange rates and international payments that enables countries and their citizens to buy goods and services from each other is ________. a. the International Development Association b. the Multilateral Investment Guarantee Agency c. the World Trade Organization d. the World Bank e. the International Monetary Fund

Ch. 1 - E

Globalization has always been and always will remain another word for "Westernization." a. True b. False

Ch. 1 - False

In market economies, governments maximize the role of state-owned enterprises, which makes them more likely to impose wage and price controls. a. True b. False

Ch. 1 - False

An important role of successful institutions includes defining property rights and contracts and determining who gets what and when. a. True b. False

Ch. 1 - True

Globalization encompasses the socio-economic reform process of eliminating trade, investment, cultural, information technology, and political barriers across countries, which could lead to increased economic growth and geo-political integration and interdependence among nations of the world. a. True b. False

Ch. 1 - True

Today, reconstruction and restructuring economies to make them efficient remain a major role of the World Bank, along with poverty reduction. a. True b. False

Ch. 1 - True

Taxes on imports are known as ________. a. tariffs b. subsidies c. loans d. grants e. funds

Ch. 2 - A

Which of the following was NOT one of the top ten exporting nations in 2010? a. India b. Germany c. The United Kingdom d. France e. The United States

Ch. 2 - A

An agreement in which an exporter of goods or services to another country commits to importing goods or services of corresponding value from that country is referred to as ________. a. an export cartel b. countertrade c. managed trade d. bartering e. an embarg

Ch. 2 - B

________ refers to trade sanctions which are imposed upon a nation to restrict trade with that country. a. Tariffs b. Countertrade c. Embargo d. Duties e. Managed trade

Ch. 2 - C

Porter identified two crucial variables outside the diamond that play an important role in the competitiveness of nations: chance and ________. a. duty b. ethics c. roles d. government e. change

Ch. 2 - D

Import quotas are also known as ________. a. qualitative restrictions b. domestic content imports c. shared wealth barriers d. voluntary export restrictions e. quantitative restrictions

Ch. 2 - E

Which of the following is an objective of ASEAN? a. To manage relations with western countries b. To promote regional peace and stability c. To establish the largest economic integration d. To create an exclusive community e. To enhance the member citizens' economic growth

Ch. 3 - B

A growing ASEAN concern is the economic ascendancy of ________. a. Indonesia b. Vietnam c. China d. the Philippines e. North Korea

Ch. 3 - C

The study of principles that govern the efficient spatial allocation of economic resources and the resulting consequences is referred to as _________. a. economic integration b. regional integration c. economic geography d. spatial transformation e. economic recovery

Ch. 3 - C

ASEAN's two main objectives are: (1) to accelerate economic growth, social progress, and cultural development in the region; and (2) to promote trade with EU. a. True b. False

Ch. 3 - False

One of NAFTA's major objectives is the protection of intellectual property rights. a. True b. False

Ch. 3 - False

Regional integration is nothing more than simply cross-border trade liberalization. a. True b. False

Ch. 3 - False

The origins of the EU can be traced to the creation of the European Coal and Steel Community (ECSC), which established a common market in coal, steel, and iron ore among the six founding member countries: France, West Germany, Italy, Turkey, the Netherlands, and Luxembourg, in 1952. a. True b. False

Ch. 3 - False

For regional integration to be successful, member countries need to undertake spatial transformations and allow efficient geographic distribution of economic activities within and among countries. a. True b. False

Ch. 3 - True

There are about ________ different currencies that are used to make international payments for goods and services. a. 150 b. 100 c. 200 d. 175 e. 50

Ch. 4 - A

Balance of payments is generally split into ________ major components. a. three b. two c. five d. four e. six

Ch. 4 - B

A monetary system with varying degrees of government intervention to maintain a range of acceptable values against other currencies is called ________. a. a special drawing right b. clean float currency c. a soft currency d. dollarization e. dirty float currency

Ch. 4 - E

A principle implying that expected future spot exchange rates and spot exchange rates set interest rates on bonds in different countries equal to one another is called ________. a. the interest rate parity theory b. the big mac index c. the uncovered interest rate parity theory d. the law of one price e. the covered interest rate parity theory

Ch. 4 - E

By comparing the prices of identical goods in different countries, assuming efficient markets that arbitrage away price differences, the real or PPP exchange rate can be computed. a. True b. False

Ch. 4 - True

Hard currencies are used by emerging market countries to peg the values of the soft currencies. a. True b. False

Ch. 4 - True

Today, the SDR is a basket of currencies consisting of dollars, euros, pounds, and yen, with relative weights set by the IMF based on trade patterns. a. True b. False

Ch. 4 - True

Some examples of ________ cultural metaphors are: French wine (purity, compatibility), a German symphony (education and politics), and a British house (laying the foundation.) a. Gannon's b. Hawthorne's c. Hofstede's d. Locke's e. Trompenaars's

Ch. 5 - A

Of the following, which describes Trompenaars's degree to which a society compartmentalizes roles? a. Individualism vs. collectivism b. Specific vs. diffuse c. Uncertainty avoidance d. Masculine vs. feminine e. Neutral vs. emotional

Ch. 5 - B

Of the following, which is NOT a cultural aspect of doing business in Japan? a. New potential business partners must have been referred to Japanese business representatives through a third party. b. The number 1 is good, whereas the number 4 signifies death. c. Japanese business has a group orientation. d. Upon meeting a Japanese executive, a slight bow and handshake are appropriate. e. It is not appropriate to look directly into the eyes of your Japanese hosts.

Ch. 5 - B (This is a Korean cultural aspect)

Of the following, which dimension identified by Hofstede refers to the worth of an individual versus the worth of the group? a. Masculine vs. feminine b. Uncertainty avoidance c. Individualism vs. collectivism d. Internal control vs. external control e. Power distance

Ch. 5 - C

Check My Work ________ refers to what is perceived as taste and beauty in society. a. Social institution b. Stratification c. Material culture d. Intangible culture e. Aesthetics

Ch. 5 - E

There are ________ characteristics of culture which are important for global companies to recognize. a. three b. two c. five d. six e. four

Ch. 5 - E

________ communication refers to the message's actual content. a. Backward b. Formal c. Informal d. Nonverbal e. Verbal

Ch. 5 - E

________ in a society is often a direct result of technology. a. Social institutions b. Stratification c. Aesthetics d. Intangible culture e. Material culture

Ch. 5 - E

Fortunately, a country's culture can easily be modified. a. True b. False

Ch. 5 - False

One must understand when doing business in Korea that the number 4 is good, whereas the number 1 signifies death or failure. a. True b. False

Ch. 5 - False

Social infrastructure involves transportation, energy, and communications. a. True b. False

Ch. 5 - False

Attitudes are feelings or opinions. a. True b. False

Ch. 5 - True

Universalism vs. particularism refers to the importance of rules versus relationships in a society. a. True b. False

Ch. 5 - True

The chemical formula for a new drug to cure colon cancer, a new biography of President Barack Obama, a new computer software video game, and the musical score to a new movie are all examples of ________. a. intellectual property b. a trademark c. a generalized trademark d. a contract e. a patent

Ch. 6 - A

Which of the following countries was listed as the world's most dangerous in 2009? a. Somalia b. Pakistan c. Sudan d. Haiti e. Zimbabwe

Ch. 6 - A

A(n) ________ risks refers to a political risk that affects all businesses in a given country. a. environmental b. macropolitical c. political d. micropolitical e. individual

Ch. 6 - B

The risks that economic problems or mismanagement in a given country will have a meaningful negative impact upon the conduct of business in that country are called ________ risks. a. political b. financial c. economic d. individual e. environmental

Ch. 6 - C

There are essentially ________ kinds of business corruption. a. four b. five c. two d. six e. three

Ch. 6 - C

________ democracy is a pure form of democracy, in which all adult citizens vote directly on matters affecting the community. a. Totalitarianism b. Egalitarian c. Athenian d. Representative e. Communism

Ch. 6 - C

________ is an economic ideology whereby the government or state owns and controls all major factors of production and is philosophically an economically classless society. a. Representativeness b. Totalitarianism c. Communism d. Egalitarianism e. Athenian

Ch. 6 - C

There are ________ primary kinds of legal systems in countries throughout the world. a. four b. six c. two d. three e. five

Ch. 6 - D

________ law is the body of law governing legally enforceable agreements between parties to engage in economic exchange. a. Democratic b. Criminal c. Common d. Contract e. Theocratic

Ch. 6 - D

The United States follows a ________ law legal system. a. theocratic b. representative c. family d. civil e. common

Ch. 6 - E