BUSMHR 2000 Exam 1

The mother tongue of the largest number of people is Multiple Choice Mandarin. French. English. Spanish. Hindi.

Mandarin.

Economist Robert Reich advocates that the outsourcing of productive activities to different suppliers results in the creation of unlimited costs. global products. national tensions. a single currency. a global legal system.

global products.

________ justifies some limited government intervention to support the development of certain export-oriented industries. Heckscher-Ohlin theory Mercantilism Theory of comparative advantage New trade theory Theory of absolute advantage

New Trade Theory

People in the West tend to associate a representative democracy with Multiple Choice weak property rights protection. a command economic system. a theocratic regime. low level of life expectancy at birth. a market economic system.

a market economic system.

A situation in which an economic gain by one country results in an economic loss by another is called a positive-sum game. diminishing return. first-mover advantage. zero-sum game. dynamic effect.

zero-sum game.

While it might differ in other countries, in the United States the customary distance apart that should be used in a business discussion is Multiple Choice 3-5 feet. 5-8 feet. 18-24 inches. at least 10 feet. 36 inches or under.

5-8 feet.

Which institution was established as a result of the Uruguay Round of GATT? United Nations World Bank International Monetary Fund World Trade Organization Group of Twenty

World Trade Organization

Grossman and Krueger's study revealed the relationship between pollution levels and income. Which pollutant was the exception to their study? nitrous oxide sulfur dioxide lead carbon dioxide hydrogen

carbon dioxide

The social rules and guidelines that prescribe appropriate behavior in particular situations are called Multiple Choice values. traditions. taboos. norms. customs.

norms.

Which scenario best represents a mores violation? Multiple Choice Showing up late to a meeting in a country where time is equivalent to money. Failing to bow in a country where bowing is a sign of respect. Wearing casual clothes to a meeting in a country where the dress code is very formal. Addressing a business partner by their first name in a country where appropriate titles and last names are used. Bribing a government official in a country where bribery is illegal.

Bribing a government official in a country where bribery is illegal.

If Kendra was working in the home office in Ohio she never would have agreed to pay the government official to speed up the delivery of the cargo; but since she is working in the company's foreign office, she agrees to the practice since it is considered normal in this country. Which philosophical approach to ethics is Kendra using to make her decision? Kantian approach Cultural relativism Naive immoralism Righteous moralism Friedman doctrine

Cultural relativism

American company Software Unlimited is planning to expand its operations to the Bangor Republic where the group is the primary unit of social organization. According to this information, what is a likely outcome for Software Unlimited from operating in the Bangor Republic? Multiple Choice Employees will strive to achieve a personal brand. Employees will lack company loyalty. Employees will constantly innovate with their creative ideas for products. Employees will fail to obtain company-specific experience and knowledge. Employees will achieve close cooperation with others.

Employees will achieve close cooperation with others.

Which of these companies exemplifies the globalization of markets? The clothes of Sea Shell Fashions, a U.S.-based company, are hand-sewn by workers in India. The accounts of a U.K.-based finance company are maintained and managed by an accounting firm in the Czech Republic. Fluffy Pillows, a U.S.-based pillow company, sells the same pillows worldwide. Iconic Industries Inc., a U.S. energy company, has generated capital from investors all over the world. Wine producer Violet Wines procures high-quality grapes from neighboring countries.

Fluffy Pillows, a U.S.-based pillow company, sells the same pillows worldwide

According to globalization supporters, what is an advantage of globalization? Globalization provides more economic power to national governments. As a result of globalization, pollution levels fall significantly in the world's poorer nations. As a result of globalization, countries relax their labor standards. Globalization leads to tougher environmental regulations which significantly decrease the costs of manufacturing enterprises. Globalization helps create jobs in all countries that participate in the global trading system.

Globalization helps create jobs in all countries that participate in the global trading system.

________ gives employees the integrity to go public to the media and blow the whistle on persistent unethical behavior in a company. Moral courage Cultural relativism Righteous moralism Moral imagination Naive immoralism

Moral courage

What occurs according to Moore's law? The power of microprocessor technology doubles and its cost of production falls in half every 18 months. The demand for microprocessor technology falls in half every 18 months. The demand for microprocessors continues to rise, while their supply falls. The price of microprocessors continues to fall, while their cost of production increases. The cost of microprocessors increases as their power increases.

The power of microprocessor technology doubles and its cost of production falls in half every 18 months

A country that has ________ is an unattractive choice for international business. Multiple Choice strong protection of property rights market-based economic policies a closed totalitarian dictatorship the presence of business contract law a large market size in terms of population

a closed totalitarian dictatorship

John, an American executive, learns that a foreign subsidiary hired a 12-year-old orphan girl to work on the factory floor. He knows that using child labor is in direct violation of the company's own ethical code. At the same time, he does not think that denying the child her only source of income is right. John is facing the stakeholder doctrine. the tragedy of the commons. positivity effect. an ethical dilemma. the sustainability effect.

an ethical dilemma.

Corinne 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 Corinne basing her decision on? Multiple Choice costs risks norms behaviors benefitsF

benefits

Jerome knew it was wrong for his company to continue ignoring environmental standards set down by the state. Jerome is able to determine this based on business strategies. business objectives. business ethics. business development. business goals.

business ethics.

In many of the world's nation-states, there has been a move away from ________ since the late 1980s. Multiple Choice economic gains democratization free markets centrally planned command economies legal systems to safeguard property rights

centrally planned command economies

According to Porter, which factor endowment would be classified as an advanced factor? location natural resources climate demographics communication infrastructure

communication infrastructure

Which term indicates that the units of resources required to produce a good are assumed to remain fixed no matter where one is on a country's production possibility frontier? experience curve economies of scope diseconomies of scale constant returns to specialization economies of scale

constant returns to specialization

The system of values and norms that are shared among a group of people and together create a design for living is known as a society. culture. tradition. nationality. ritual.

culture

Shannon works as the executive manager of an international business, while Bob is the executive manager of a purely domestic business. Which of these responsibilities apply to both Shannon and Bob? dealing with government restrictions on international trade and investment adopting the appropriate policies for coping with country differences dealing with business attacks from competitors choosing the appropriate mode for entering a particular country for business coordinating and controlling globally dispersed production activities

dealing with business attacks from competitors Correct

Kyra works for a costume jewelry manufacturer and while their products are lower in cost, there is a high degree of consumer pressure to create the best quality jewelry possible and to constantly innovate with new jewelry designs. Which aspect of Porter's Diamond does this demonstrate? factor endowments firm structure and rivalry demand conditions related and supporting industries first-mover advantages

demand conditions

If a 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, it is against the practice of Multiple Choice protectionism. deregulation. a command economy. collectivism. industrialization.

deregulation

A country that abolishes laws that regulate private enterprises and removes price controls is in the process of Multiple Choice deregulation. industrialization. divestiture. diversification. isolationism.

deregulation.

What was the motivation for non-U.S. firms to begin investing across national borders in the 1970s? desire to disperse production activities to optimal locations host of investment opportunities in foreign nations shift toward a more integrated and interdependent global economy rise in barriers to trade and foreign direct investments limits imposed by government intervention in international trade

desire to disperse production activities to optimal locations

The two caveats of the Sullivan principles are first, a company should not obey the apartheid laws in its own South African operations and second, a company should do everything possible to abolish apartheid laws. provide facilitating payments to foster the apartheid movement. limit toxic emissions and control environmental pollutants. not add to the tragedy of the commons. return production facilities to the home country.

do everything possible to abolish apartheid laws.

The main reason that gross national income figures can be misleading is because they Multiple Choice don't consider differences in the cost of living. are determined by individual governments instead of a national institution. are an adjustment of the purchasing power parity (PPP). measure the total dollar amount of imports coming into a nation. allow for a direct comparison of living standards in different countries.

don't consider differences in the cost of living.

Which of the following BEST increases a country's competitive advantage and its attractiveness as a location for international business? Multiple Choice prevalence of communist ideals education system that is well developed belief in monotheism presence of more than one language or culture presence of class or caste differences

education system that is well developed

When Mark Zuckerberg co-founded Facebook, he was acting as a(n) ________ since he was the first to commercialize this innovative new product. Multiple Choice late-mover political action committee multinational regulator entrepreneur

entrepreneur

Shayla is from South Africa and believes that the customs and beliefs of her culture are superior to those she has encountered during her trip to America. Shayla's attitude is an example of Multiple Choice ethnocentrism. Confucian dynamism. cultural convergence. collectivism. class consciousness.

ethnocentrism.

MaryAnne is always late to meetings and she knows she needs to be better about being on time because it is expected by almost everyone living in the United States. This attitude toward time is an example of a Multiple Choice moral. belief. value. folkway. mores.

folkway.

California-based Urban Health Source has invested resources in business activities in Italy. What type of business activity does this represent? multinational exchange foreign direct investment exporting globalization of markets international trade

foreign direct investment

One cost-cutting measure used by Garr Tool Corp. is sourcing the parts it uses from companies in Germany, Ireland, and Canada that are more economical than home-country sources. The choice to use these sources is an example of the emergence of global institutions. regulation of the environment. globalization of production. globalization of markets. company's social responsibility.

globalization of production. Correct

The merging of national markets that have historically been distinct and separate is the process of globalization. containerization. industrialization. foreign direct investment. international busines

globalization.

Payments used to ensure receiving the standard treatment that a business ought to receive from a foreign government, but might not due to the obstruction of a foreign official, are called forward exchange payments. purchasing parity. deferred payments. kickbacks. grease payments

grease payments

Within the context of the individual as the basic unit of a social organization, what is an implication of the emphasis on individualism in many Western societies? high degree of social stratification low degree of competition between individuals high degree of managerial mobility between companies low degree of entrepreneurial activity high degree of cooperation between individuals

high degree of managerial mobility between companies

Technology is indicated as having a major impact on the declining share of national income enjoyed by labor. If this is the case, what is a logical solution to this problem? increasing society's investment in education restricting exports of jobs restricting access to technology decreasing the wage rates of skilled workers increasing the supply of unskilled workers

increasing society's investment in education

What do new trade theorists point to as the reason for gaining a first-mover advantage? supply conditions government policy factor endowments innovation and luck tariff and nontariff barriers

innovation and luck

Daria owns 100 shares of stock in Dow Corning. She would be considered a(n) internal stakeholder. mini-multinational. external stakeholder. customer. supplier.

internal stakeholder

Canadian company Yummy Snacks exports a number of products to consumers in Peru, Chile, and Argentina. According to this information, Yummy Snacks is most likely involved in international trade. outsourcing. foreign direct investment. globalization of production. trade protectionism.

international trade.

What is one of the three measures used to determine the Human Development Index (HDI) of a country? Multiple Choice life expectancy at birth gender ratio carbon footprint of the country wholesale price index factors endowments

life expectancy at birth

According to Geert Hofstede, what dimension captures attitudes toward time, persistence, ordering by status, protection of face, respect for tradition, and reciprocation of gifts and favors? Multiple Choice social mobility class consciousness uncertainty avoidance power distance long-term versus short-term orientation

long-term versus short-term orientation

Kevin lives in a nation that encourages the production of goods for exporting and to satisfy the needs of the nation's citizens so fewer imports are needed. Which trade theory does this reflect? new trade theory mercantilism theory of comparative advantage theory of absolute advantage Heckscher-Ohlin theory

mercantilism

The government of the Republic of Senna enforces tariffs and quotas to limit imported goods, while exports are subsidized. By using these instruments, the government seeks to achieve a surplus in the balance of trade. Based on this information, which approach most influences the Republic of Senna's approach to international trade? product life-cycle theory new trade theory Heckscher-Ohlin theory theory of absolute advantage mercantilism

mercantilism

Connor asked the management team to consider how they would feel if they were asked to travel more than 50 miles to get to work—which is what they were asking the management team at the foreign office to do. Connor is relying on ________ to approach this ethical situation. the naïve immoralist approach the difference principle the Sullivan principle moral imagination ethnocentrism

moral imagination

Gigantic Games., a U.S.-based company that specializes in strategy-based board games, has production facilities in Poland and Spain. Based on this information, Gigantic Games can be classified as what type of enterprise? local multinational private public semipublic

multinational

Which approach suggests that nations may benefit from trade even when they do not differ in resource endowments or technology? new trade theory mercantilism theory of comparative advantage theory of absolute advantage Heckscher-Ohlin theory

new trade theory

ABC Company 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 ABC Company trying to avoid? Multiple Choice ethical legal economic technological political

political

Jason runs a manufacturing company. He hires five people based on their physical abilities because they are able to lift heavy boxes in the stockroom and two people based who are able to strategically plan the company's next steps. Jason realizes that people are not equal in physical and intellectual capabilities, an aspect of which cultural dimension identified by Hofstede? Multiple Choice individualism masculinity uncertainty avoidance class consciousness power distance

power distance

One root cause of unethical behavior in business is a strong sense of personal ethics. pressure to meet unrealistic performance goals. a societal culture with low power distance. management's ability to see beyond economic benefits. organization culture that emphasizes business ethics.

pressure to meet unrealistic performance goals.

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 Multiple Choice communism. protectionism. nationalization. privatization. socialism.

privatization.

Raymond Vernon noticed that in the 1960s, the wealth and size of the U.S. market was a natural incentive to develop new consumer products. What theory did he propose based on this fact? new trade absolute advantage mercantilism product life-cycle comparative advantage

product life-cycle

Julie asked her assistant to determine the gross national income of three different countries by evaluating the GNI against the cost of living in the United States. What measure is Julie asking her assistant to use? Multiple Choice factor endowments gross domestic product return on investment cash reserve ratio purchasing power parity

purchasing power parity

Which philosophical approach is typically associated with managers from developed nations, and claims that a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries? sullivan principles cultural relativism naive immoralism righteous moralism friedman doctrine

righteous moralism

Connor was born into a poor family, but he worked hard during high school and went on to receive his master's degree in business. Today, he is considered "upper middle class" and enjoys a comfortable lifestyle. Connor's journey is an example of Multiple Choice social mobility. a caste system. reciprocal beliefs. class consciousness. a rigid class system.

social mobility.

The social strata evident in a society is primarily derived from Multiple Choice socioeconomic characteristics. evidence of competition. government policy. the collectivistic nature of the group. individual characteristics such as physical appearance.

socioeconomic characteristics.

A ________ is an individual or group that has an interest or claim in what a company does and how well it performs. supplier competitor trustee drawee stakeholder

stakeholder

Strategies that not only help the multinational firm make good profits, but that do so without harming the environment while simultaneously ensuring that the corporation acts in a socially responsible manner with regard to its stakeholders are called Kantian strategies. sustainable strategies. utilitarian strategies. moral strategies.

sustainable strategies.

The base for the adjustment of purchasing power parity is the cost of living in Multiple Choice the United Kingdom. the United States. China. Brazil. Russia.

the United States.

Krisp Systems decides to move production to a developing country where they are free to pump pollutants into the atmosphere without legal restriction. By doing this, the company is contributing to corporate social responsibility. corruption. cultural relativism. the global tragedy of the commons. sustainability

the global tragedy of the commons.

When considering globalization, what is considered the single most important innovation since World War II? higher education transcontinental air transport the telephone the microprocessor cross-country railway systems

the microprocessor

The Heckscher-Ohlin theory is based on the idea that it makes more simplifying assumptions than the theory of comparative advantage. it is in a country's best interests to maintain a trade surplus. economies of scale are a good predictor of real-world international trade patterns. the pattern of international trade is determined by differences in factor endowments. it is more profitable for a country to balance exports and imports.

the pattern of international trade is determined by differences in factor endowments.

A country that has ________ lowers the risk of doing business in that country. Multiple Choice a high rate of inflation a low standard of living the presence of more than one ethnic nationality the presence of a strong legal system a large number of nonperforming loans

the presence of a strong legal system

The spread of democracy among countries is most likely to lead to Multiple Choice the widespread use of centrally planned command economies. a strong shift toward a mixed economy. the promotion of greater competition. a decline in privatization. a decrease in innovation and entrepreneurship.

the promotion of greater competition.

A number of employees at Sports Plus Inc., which is headquartered in a country where masculinity and power distance are high, do not behave in an ethical manner. In this context, the roots of unethical behavior can be traced to the organizational culture. unrealistic performance goals. the legal environment. the company's leadership. the societal culture.

the societal culture.

The Republic of Monaslu has the world's most efficient car manufacturing industry, while the country of Ingora has the world's most efficient electronics industry. The Republic of Monaslu trades cars with Ingora in exchange for consumer electronics. This form of trade between the two countries illustrates the product life-cycle theory. a zero-sum game. the Heckscher-Ohlin theory. the mercantilist doctrine. the theory of absolute advantage.

the theory of absolute advantage.

The basic message of ________ is that potential world production is greater with unrestricted free trade than it is with restricted trade. zero-sum game theory theory of comparative advantage mercantilist theory absolute advantage theory Heckscher-Ohlin theory

theory of comparative advantage

Jacques relies on a cost-benefit analysis to decide if moving operations overseas is better than increasing the size of the current manufacturing facility in the United States. He is using the ________ approach to ethics to determine his answer. utilitarian Friedman doctrine naive moralist difference principle cultural relativist

utilitarian

The ________ approach to ethics holds that the moral worth of actions or practices is determined by their consequences and is committed to the maximization of good and the minimization of harm. cultural relativism Kantian utilitarian righteous moralism Friedman doctrine

utilitarian