International Business 3450 Chapter 3 Quiz

People in the West tend to associate a representative democracy with

A market economic system

A country that abolishes laws that regulate private enterprises and removes price controls is in the process of

Deregulation

The Simpson Group decided against doing business with a country in Central America because the country exercises tight control over prices and output, prohibits private enterprises from operating in most sectors of the economy, and severely restricts foreign direct investment and international trade. In other words, this country is against the practice of

Deregulation

Anastasia asked her assistant to determine the gross national income of six different countries by evaluating the GNI against the cost of living in the United States. What measure is Anastasia asking her assistant to use?

Purchasing power parity

The spread of democracy among countries is most likely to lead to

The promotion of greater competition

Dominick has analyzed the overall attractiveness of doing business with three possible countries and has determined that Country A is the best choice based on the potential for huge economic growth that should occur there because of recent advances in technology. Which factor of overall attractiveness is Dominick basing his decision on?

benefits

The main reason that gross national income figures can be misleading is because they

don't consider differences in the cost of living.

When Steve Jobs and Steve Wozniak cofounded Apple, they were acting as __________ since they were the first to commercialize this innovative new product.

entrepreneurs

A country that has __________ lowers the risk of doing business in that country.

the presence of a strong legal system

A country that has __________ is an unattractive choice for international business.

A closed totalitarian dictatorship

More nations have gravitated toward the market-based model because

Command and mixed economies failed to deliver sustained economic performance.

The base for the adjustment of purchasing power parity is the cost of living in

The United States

Miller Plastic Group is considering two different countries for their upcoming expansion. When the board was reviewing the financial figures of the countries, the chief financial officer reminded board members that the figures might not tell the entire story as some economic activity could be taking place in the form of barter agreements and cash transactions that are never recorded. What is the CFO referring to?

The shadow economy

What is an accurate description of how the political economy of many of the world's nation-states has changed radically since the late 1980s?

There has been a move away from centrally planned and mixed economies and toward a more free market sconomic model.

The development of new products, processes, organizations, management practices, and strategies is called

innovation

U.S.-based Nelson Corporation is hesitant about entering into a licensing agreement with Lapson, Inc., a company from another nation, due to the likelihood that Lapson will break a contract or expropriate property rights. What specific type of risk is Nelson Corporation trying to avoid?

legal

What is one of the three measures used to determine the Human Development Index (HDI) of a country?

life expectancy at birth

Ocean Athletics is hesitant about entering Ukraine, because the country has been experiencing social unrest in recent years. Based on this information, what type of risk is Ocean Athletics trying to avoid?

political

In 2017, the Brazilian government transferred the state ownership of the electric company, the airports, highways, and ports to private investors to stimulate the economy. This is an example of

privatization

Economist Hernando de Soto believes that the benefits of capitalism will not be achieved until

property rights are better protected