International Management Exam #2

How many billions of dollars of FDI did Canada provide for the United States as of the end of 2010? A. $206.1 billion B. $296.7 billion C. $432.5 billion D. $257.3 billion E. $134.0 billion

A. $206.1 billion

In 2012, total international merchandise trade accounted for about _______ percent of the world's GDP. A. 26 B. 59 C. 44 D. 12

A. 26

Who is the father of free market economics? A. Adam Smith B. Michael Porter C. John Dunning D. David Ricardo

A. Adam Smith

Which country developed and first ratified the Anti-Bribery Convention of the Organization for Economic Cooperation and Development? A. Canada B. Kenya C. Australia D. Switzerland E. Austria

A. Canada

What type of trade were the early country-based theories of international trade most useful in understanding? A. Commodities B. Brand name goods C. Services D. High-tech goods

A. Commodities

Which of the following is NOT considered an intellectual property right? A. Computer software B. Copyright C. Brand name D. Trademark E. Patent

A. Computer software

When behavior conforms to generally accepted norms, it is referred to as ________ behavior. A. Ethical B. Societal C. Unethical D. Normal

A. Ethical

Which of the following was harmed the most by mercantilist policies? A. Individual consumers B. Domestic manufacturers C. Monarchs D. Local politicians

A. Individual consumers

Sonya and Amber work together in the Hong Kong corporate office. Despite having similar backgrounds and education, they cannot agree on whether it is appropriate to offer bribes to Chinese officials for the purpose of expending business transactions. Which ethical generalization does this most likely illustrate? A. Individuals have their personal belief systems B. Society requires individuals to rationalize ethical inconsistencies C. Culture has the strongest influence on personal ethics D. Personal values rarely overlap with global business dealings

A. Individuals have their personal belief systems

Why do U.S. firms use places like the Bahamas as offshore financial centers? A. It is less heavily taxes, providing a greater profit B. It is easier to set up transfers for foreign investors C. It is easier to hide illegal money D. It is more heavily regulated, allowing investors to feel safe E. It is more secure than the U.S., and less embezzlement occurs

A. It is less heavily taxes, providing a greater profit

Which of the following countries would be LEAST likely to outsource at the cost of its own working citizens? A. Japan B. China C. Canada D. Great Britain E. United States

A. Japan

You are working with different companies as you build your organization and would like to offer gifts for the help you have received from others. Which of the following would be a country that would not look at the gift as a conflict of interest? A. Japan B. Great Britain C. France D. United States E. Canada

A. Japan

Which of the following is one way that workers from the Philippines obtain jobs in Asian factories? A. Labor brokers B. International want ads C. Company recruiters D. Internet searches E. Fliers put up in schools

A. Labor brokers

Mercantilism _____________. A. Maintains that a country's wealth is measured by its holdings of gold and silver B. Suggests that a country should export those goods for which it is more productive than other countries and trade for those goods for which other countries are more productive C. Argues that most trade in manufactured goods should be between countries with similar per capita incomes D. Suggests that a country will have a comparative advantage in producing products that intensively use resources it has in abundance

A. Maintains that a country's wealth is measured by its holdings of gold and silver

Which of the following statements is most likely true? A. Nearly all countries have some neomercantilist policies B. Japan eliminated all protectionist policies after WWII C. EU countries are supportive of U.S. neomercantilist policies D. China is one of the few countries with protectionist policies

A. Nearly all countries have some neomercantilist policies

The value of a good is the value of what is given up is described by which of the following? A. Opportunity cost B. Theory of relative factor endowments C. Theory of comparative advantage D. Theory of absolute advantage E. Country of similarity theory

A. Opportunity cost

Which theory traces the roles of innovation, market expansion, comparative advantage, and strategic responses of global rivals in international production, trade, and investment decisions? A. Product life cycle theory B. Theory of comparative advantage C. Theory of relative factor endowments D. Theory of absolute advantage E. Country similarly theory

A. Product life cycle theory

Which of the following companies earned such a fearsome reputation for not acceding to bribe requests that even at remote African border crossings their Jeeps are sometimes waved through without any requests for a bribe? A. Texaco B. McDonald's C. Siemens D. Boeing E. British Petroleum

A. Texaco

The center of the international commercial flower industry is __________. A. The Netherlands B. The United States C. France D. Germany

A. The Netherlands

Which of the following is an example of an economy of scale? A. The cost of computers decreases as the quantity that is produced increases B. The cost of computers increases as the quantity that is produced decreases C. The value of computers decreases as the quantity that is produced increases D. The cost of computers increases as the quantity that is produced increases E. The value of computers increases as the quantity that is produced increases

A. The cost of computers decreases as the quantity that is produced increases

Which of the following is FALSE regarding the product life cycle theory? A. The personal computer industry has entered the maturing product stage B. Domestic production begins in stage 1, peaks in stage 2, and slumps in stage 3 C. In stage 2, foreign competitors expand their productive capacity D. Exports by the innovating firm's country begin in stage 1 and peak in stage 2 E. Foreign competition begins to emerge toward the end of stage 1

A. The personal computer industry has entered the maturing product stage

Behavior that fails to conform to generally accepted social norms is considered __________. A. Unethical B. Illegal C. Unregulated D. Ethical

A. Unethical

In 2012, China accounted for approximately _________ of the world's merchandise exports. A. 25% B. 10% C. 55% D. 40%

B. 10%

Which of the following dates provided the data Leontief used to determine U.S. imports were 6 percent more capital-intensive than U.S. exports? A. 1972 B. 1951 C. 1949 D. 1953 E. 1947

B. 1951

Which statement is asserted by the theory of absolute advantage? A. Most trade in manufactured goods should be between countries with similar per capita incomes? B. A country should export those goods for which it is more productive than other countries and trade for those goods for which other countries are more productive C. A country will have a comparative advantage if it makes products that rely on global supply networks D. A country should import goods from developing economies in order to maximize returns on profit and economies of scale

B. A country should export those goods for which it is more productive than other countries and trade for those goods for which other countries are more productive

Latisha works for a company that believes that it should meet its legal and ethical requirements, but will also go beyond these requirements in selected cases. Which of the following describes the social responsibility stance that Latisha's company is maintaining? A. Proactive stance B. Accommodative stance C. Defensive stance D. Obstructionist stance E. Reactive stance

B. Accommodative stance

You are about to send some employees over to Russia and have decided to ensure that they are well versed in business customs and practices by teaching them the Russian language. Which company do you work for? A. Boeing B. British Petroleum C. Toyota D. Daewoo E. Siemens

B. British Petroleum

In which of the following countries was Durawool, an American steel-wool manufacturer, shocked to learn that the foreign country in which it had operations offered it little protection when one of its local employees left the company's subsidiary and promptly started a rival firm using Durawool's technology? A. Hong Kong B. China C. South Korea D. Japan E. United States

B. China

Gift exchanges in a business situation in Japan are best described as _________. A. Rare B. Common C. Trendy D. Illegal

B. Common

Which of the following is particularly useful in explaining trade in differentiated goods such as automobiles, expensive electronics equipment, and personal care products, for which brand names and product reputations play an important role in consumer decision making? A. Theory of relative factor endowments B. Country similarity theory C. Opportunity cost D. Theory of comparative advantage E. Theory of absolute advantage

B. Country similarity theory

BP's program to prepare managers at HQ's for assignments in Russia is an example of ________. A. Selection procedures B. Ethics training C. Corporate socialization D. Employee orientation

B. Ethics training

Which of the following is a law that was passed by the United States Congress in 1977 to prohibit U.S. firms, their employees, and agents acting on their behalf from paying or offering to pay bribes to any foreign government official in order to influence the official actions or policies of that individual to gain or retain business? A. ILO B. FCPA C. ATCA D. CARE E. MNC

B. FCPA

Which of the following is FALSE regarding Research and Development (R&D)? A. U.S. agricultural chemical producers such as Monsanto and Eli Lilly have an advantage over Japanese rivals in developing soybean pesticides B. Firms with large domestic markets do not have an advantage over foreign rivals in high-technology markets C. National competitiveness and trade flows may be determined by which firms make the necessary R&D expenditures D. The European Union is a large exporter of commercial aircraft E. R&D is a major component of the total cost of high-technology products

B. Firms with large domestic markets do not have an advantage over foreign rivals in high-technology markets

Which country's government passed the Bribery Act? A. United States B. Great Britain C. Canada D. France E. Japan

B. Great Britain

You are thinking about outsourcing some of your work to Bangladesh and need to know more about working conditions there. Which of the following is one organization that could help you with this? A. FCPA B. ILO C. ATCA D. CARE E. MNC

B. ILO

Mick has been padding his expense account on business trips. However, it seems fair to him because the company refuses to provide him with comp time despite long hours he works on these business trips. Which ethical generalization does this most likely illustrate? A. Individuals have their own personal belief system B. Individuals can rationalize behavior in various circumstances C. Individuals from the same cultural contexts have similar beliefs D. Individuals are typically consistent with their beliefs

B. Individuals can rationalize behavior in various circumstances

You are looking at how business hours will be set up in some of your foreign offices. In which country's office would you see junior employees required to stay long than senior employees? A. Hong Kong B. Japan C. United States D. China E. South Korea

B. Japan

A firm that does as little as possible to address social or environmental problems is considered to have adopted which of the following approaches to social responsibility? A. Reactive stance B. Obstructionist stance C. Accommodative stance D. Defensive stance E. Proactive stance

B. Obstructionist stance

You are businessperson making decisions. What is likely your ultimate goal in this decision-making process? A. Maintaining values B. Profit-making C. Social responsibility D. Foreign relations E. Ethical conduct

B. Profit-making

Which of the following normally influences formal laws in a society? A. Profit-making B. Social norms C. Personal beliefs D. Government interest E. Social responsibility

B. Social norms

Which theory states that success in international trade comes from the interaction of four country- and firm-specific elements? A. Theory of absolute advantage B. Theory of national competitive advantage C. Theory of comparative advantage D. Theory of relative factor endowments E. Country similarity theory

B. Theory of national competitive advantage

Which of the following identifies a key reason for why the United States has seen great international film success? A. Investors all come from the United States B. There is intense competition within the United States C. There is more money to spend D. All of the best actors are in the United States E. Other markets do not have the skills

B. There is intense competition within the United States

What was the amount of total international merchandise trade in 2011? A. $4.5 trillion B. $9 trillion C. $18.3 trillion D. $13.5 trillion E. $25 trillion

C. $18.3 trillion

The theory of absolute advantage suggests which of the following? A. A country should import those goods and services for which it is more productive than other countries are, and import those goods and services for which other countries are more productive than it is B. A country should produce and export those goods and services for which it is relatively more productive than other countries are, and import those goods and services for which other countries are relatively more productive than it is C. A country should export those goods and services for which it is more productive than other countries are, and import those goods and services for which other countries are more productive than it is D. A country should produce and import those goods and services for which it is relatively more productive than other countries are, and export those goods and services for which other countries are relatively more productive than it is E. A country should import those goods and services for which it is more productive than other countries are, and export those goods and services for which other countries are more productive than it is

C. A country should export those goods and services for which it is more productive than other countries are, and import those goods and services for which other countries are more productive than it is

Which theory suggests that a country should export those goods and services for which it is more productive than other countries and import those goods and services for which other countries are more productive? A. Comparative advantage B. Specialization of countries C. Absolute advantage D. Mercantilism

C. Absolute advantage

In which country do local journalists expect their cab fare to be paid if they are to cover a business-sponsored news conference? A. Russia B. Cambodia C. China D. Japan E. Romania

C. China

Which country conducts much business through guanxi? A. South Korea B. Japan C. China D. United States E. Hong Kong

C. China

Which theory suggests that a country should produce and export those goods and services for which it is relatively more productive than other countries and import those goods and services for which other countries are relatively more productive? A. Absolute advantage B. Specialization of countries C. Comparative advantage D. Relative advantage

C. Comparative advantage

Jack always likes to place orders with Sam's Supply Company because the company sends him a gift certificate for $100 each holiday season. Which ethical issue is this an example of? A. Honesty B. Secrecy C. Conflict of interest D. Confidentiality

C. Conflict of interest

Which terms refers to a decision that benefits an individual to the possible detriment of the organization? A. Ethical behavior B. Confidentiality C. Conflict of interest D. Breach of privacy

C. Conflict of interest

Which of the following terms describes when a firm's average cost decreases as the number of different products it sells increases? A. Intraindustry trade B. Economies of scale C. Economies of scope D. Country similarity theory E. Experience curve

C. Economies of scope

Adam Smith was best known as an advocate of _________. A. Mercantilism B. Labor unions C. Free-market economics D. Low-cost manufacturing

C. Free-market economics

Three employees of Martin Enterprises have flown to China to meet a potential business partner. The three employees cannot agree about giving a gift to the potential partner. James, an American manager, believes that gift-giving is an ethical violation. Eun Hee, a South Korean manager, and Evan Lee, a Japanese manager, assert that gift-giving would be appropriate. This situation most likely illustrates which of the following statements? A. Belonging to a group is important to the Asian culture B. Individuals may not always be consistent with their beliefs C. Gift exchanges are a more important way of doing business in high-context cultures D. Personal and business ethics are often rationalized

C. Gift exchanges are a more important way of doing business in high-context cultures

Which U.S. president famously requested that someone should find him a one-armed economist? A. Franklin Delano Roosevelt B. John F. Kennedy C. Harry S. Truman D. Bill Clinton E. Richard Nixon

C. Harry S. Truman

Ellis, a manager at an MNE, is studying international trade theories. In his current position, Ellis would most likely use this knowledge to ___________. A. Lobby for trade policy changes B. Predict factors that motivate trade C. Identify promising export and investment opportunities D. Analyze foreign exchange markets

C. Identify promising export and investment opportunities

Which of the following best explains why looting was uncommon in Japan after the country's 2011 earthquake and tsunami? A. Pressures from law enforcement B. Individual desires for survival C. Importance of group membership D. Personal religious beliefs

C. Importance of group membership

Ethical beliefs are primarily _______ in nature. A. Cultural B. Familial C. Individual D. Societal

C. Individual

The first theories of international trade used _________ as a unit of analysis. A. Regions B. Country clusters C. Individual countries D. Continents

C. Individual countries

You are going to do business in foreign markets and need to determine which markets will require bribes to get through public officials so you can avoid them. Which of the following countries would you want to avoid? A. Austria B. Australia C. Kenya D. Switerzland E. Canada

C. Kenya

Gift exchanges are likely to be considered a conflict of interest in a(n) ______________ culture. A. High-context B. Collectivist C. Low-context D. Power-respecting

C. Low-context

The theory of _______ maintains a country's wealth is measured by its holdings of gold and silver. A. Comparative advantage B. Neomercantilism C. Mercantilism D. Competitive advantage

C. Mercantilism

What did Adam Smith believe about the ultimate effects of mercantilist policies on the health of a country's economic situation? A. Mercantilist policies strengthen an economy by protecting against competition B. Mercantilist policies result in strong rates of unemployment C. Mercantilist policies reduce the wealth of a country as a whole D. Mercantilist policies harm special interest groups

C. Mercantilist policies reduce the wealth of a country as a whole

HR at APEX designs, an international architectural firm noticed the following behaviors among employees lately. Which of the following would most likely be considered a problematic ethical situation at APEX? A. Working overtime B. Making business calls during work time C. Padding company expense accounts D. Bringing office supplies from home

C. Padding company expense accounts

In the U.S., sugar growers, steel companies, and the AFL-CIO are supporters of mercantilist policies. These groups are best characterized as _________. A. Communists B. Isolationists C. Protectionists D. Federalists

C. Protectionists

Which of the following would be a firm's social responsibility when operating in a global market? A. Strong economic gain B. Effective foreign relations C. Safe working environment D. Adherence to home laws E. Flexible ethical standards

C. Safe working environment

During which century were the first theories of international trade developed? A. Seventeenth B. Nineteenth C. Sixteenth D. Eighteenth

C. Sixteenth

The primary flaw in the theory of absolute advantage is that the theory __________. A. Confuses the acquisition of treasure with the acquisition of wealth B. Incorporates the concept of opportunity cost in determining which goods a country should produce C. Suggests that no trade will occur when one country has an absolute advantage in multiple products D. Looks only at relative productivity differences rather than competitive differences

C. Suggests that no trade will occur when one country has an absolute advantage in multiple products

How many barrels of oil were spilled on the Atlantic platform? A. 195 B. 189 C. 191 D. 193 E. 197

D. 193

Which of the following would be an example of the experience curve? A. An advantage that a company gets with years of research experience B. An advantage that a company gets with experience in trading and interacting in foreign markets C. An advantage that a company gets with years of experience in a given market D. An advantage that a company with factory workers who have experience with a certain product E. An advantage that a company gets with years of proven financial success

D. An advantage that a company with factory workers who have experience with a certain product

Which of the following was Apple's initial home base? A. Arizona B. Texas C. Colorado D. California E. New York

D. California

Braxton Clothing Company most likely forbids its buyers from accepting gifts from potential suppliers because the firm wants to avoid a(n) ____________. A. Trade violation B. Strategic breakdown C. Breach of contract D. Conflict of interest

D. Conflict of interest

Which term refers to an individual's personal beliefs about whether a decision, behavior, or action is right or wrong? A. Norms B. Culture C. Values D. Ethics

D. Ethics

Since World War II, world trade has _________. A. Grown slightly B. Shrunk slightly C. Shrunk significantly D. Grown dramatically

D. Grown dramatically

Which of the following is most influential on an individual's ethics? A. Social trends B. TV C. Occupation D. Peers

D. Peers

According to mercantilism, what should a country's primary goal be? A. Encouraging imports to prevent resource depletion B. Ensuring sufficient labor for low-wage jobs in the textile industry C. Protecting citizens from unfair labor practices D. Promoting exports to enlarge gold and silver holdings

D. Promoting exports to enlarge gold and silver holdings

Which of the following is NOT a reason for development of modern firm-based trade theories? A. The failure of Leontief and other researchers to empirically validate the country-based Heckscher-Ohlin theory B. Firm-based theories incorporate factors such as quality, technology, brand names, and customer loyalty into explanations of trade flows C. The inability of the country based theories to explain and predict the existence and growth of intraindustry trade D. The recognition of countries, not firms, are the agents for international trade E. Recognition of the growing importance of MNCs in the postwar international economy

D. The recognition of countries, not firms, are the agents for international trade

The term _________ refers to the voluntary exchange of goods, services, assets, or money between one person or organization and another. A. Sales B. Transaction C. Strategic management D. Trade

D. Trade

_________ are the things a person feels to be important. A. Expectations B. Norms C. Ethics D. Values

D. Values

Which of the following is most susceptible to ethical variation in international business? A. Employee skills B. Advertising C. Insurance benefits D. Working conditions

D. Working conditions

How much foreign direct investment (FDI) was used by Dutch explorer Peter Minuet to gain Manhattan Island? A. $100 billion B. $278,000 C. $5 million D. $550 E. $24

E. $24

The theory of comparative advantage suggests which of the following? A. A country should import those goods and services for which it is more productive than other countries are, and export those goods and services for which other countries are more productive than it is B. A country should produce and import those goods and services for which it is relatively more productive than other countries are, and export those goods and services for which other countries are relatively more productive than it is C. A country should import those goods and services for which it is more productive than other countries are, and import those goods and services for which other countries are more productive than it is D. A country should export those goods and services for which it is more productive than other countries are, and import those goods and services for which other countries are more productive than it is E. A country should produce and export those goods and services for which it is relatively more productive than other countries are, and import those goods and services for which other countries are relatively more productive than it is

E. A country should produce and export those goods and services for which it is relatively more productive than other countries are, and import those goods and services for which other countries are relatively more productive than it is

Jadyn works for a company that believes that it should do everything that is required of it legally, but nothing more. Which of the following describes the social responsibility stance that Jadyn's company is maintaining? A. Obstructionist stance B. Reactive stance C. Accommodative stance D. Proactive stance E. Defensive stance

E. Defensive stance

Which of the following describes an individual's personal beliefs about whether a decision, behavior, or action is right or wrong? A. Norms B. Rules C. Values D. Responsibility E. Ethics

E. Ethics

Which of the following is considered to be the social responsibility stance that exhibits the highest degree of social responsibility? A. Reactive stance B. Defensive stance C. Obstructionist stance D. Accommodative stance E. Proactive stance

E. Proactive stance

Which of the following is one of the reasons diamonds from certain areas are termed "conflict diamonds"? A. Countries fight over the right to mine them B. Smugglers are ruining the honest trade of these diamonds C. Countries that own these diamonds do not sell them to public buyers D. Corporations from other countries send people in to steal diamonds for them E. Smugglers use the money from the sale of the diamonds to finance civil wars

E. Smugglers use the money from the sale of the diamonds to finance civil wars

What was the economic philosophy that maintained that a country's wealth was measured by its holdings of gold and silver? A. Theory of comparative advantage B. Theory of national competitive advantage C. Theory of absolute advantage D. Theory of relative factor endowments E. Theory of mercantilism

E. Theory of mercantilism

Ethics is an organizational concept, not an individual one. T or F?

F

Firms that view themselves as citizens in a society and are proactive about finding ways to contribute to it are taking an accommodative stance towards social responsibility. T or F?

F

Many US firms move production and low skill jobs to developing countries to reap the benefits of low labor costs, favorable public relations, and clear-cut business practices. T or F?

F

Philanthropic giving is an example of an informal tool to manage social responsibility. T or F?

F

Thanks to the emergence of China as a major exporting nation, Japan, Canada, the EU, and the U.S. accounted for just 30 percent of the world's merchandise exports in 2012. T or F?

F

World trade initially grew after World War II, but in the last decade has dropped off and been replaced with FDI. T or F?

F

An individual's personal beliefs regarding whether a decision, behavior, or action is right or wrong is known as ethics. T or F?

T

Circumstances have a significant influence on an individual's behavior. T or F?

T

Companies can manage social responsibility using formal and informal tools. T or F?

T

Ethical behavior typically conforms to accepted social norms. T or F?

T

Merck Pharmaceuticals have exhibited philanthropy by providing free medication to individuals in developing countries for the treatment of river blindness. T or F?

T

The fundamental reason for the existence of a business is to create value. T or F?

T

Values influence how individuals define ethical vs. unethical behavior. T or F?

T

What constitutes ethical behavior varies from person to person. T or F?

T