Chapter 1: Globalization T/F

"Beggar thy neighbor" retaliatory trade policies involved countries progressively lowering trade barriers against each other, which contributed to the Great Depression of the 1930s.

FALSE

A current trend in international business is the decline of medium-sized and small multinationals, known as mini-multinationals.

FALSE

According to supporters of free trade, as countries get richer they commit greater violation of environmental and labor regulations.

FALSE

Managing an international business is much easier than managing a domestic business.

FALSE

Outsourcing is a process that is limited to manufacturing enterprises.

FALSE

The Uruguay Round, finalized in December 1993, reduced protection for patents, trademarks, and copyrights.

FALSE

The World Bank has focused on policing the world trading system and making sure nation-states adhere to the rules laid down in trade treaties.

FALSE

The World Bank is known as the lender of the last resort.

FALSE

The globalization of the world economy has resulted in a relative increase in the dominance of U.S. firms in the global marketplace.

FALSE

The most global markets currently are markets for consumer products.

FALSE

World Bank gives an aid of 100 million dollars to Kenya for creating rural health care facilities. This is an example of foreign direct investment.

FALSE

A company does not need a large size to facilitate, and benefit from, the globalization of markets.

TRUE

A firm does not have to become a multinational enterprise to engage in international business.

TRUE

According to WTO data, the volume of world merchandise trade has grown faster than the world economy since 1950.

TRUE

According to critics of globalization, today's interdependent global economy limits a nation's national sovereignty.

TRUE

Companies hope to lower their overall cost structure or improve the quality or functionality of their product offering through globalization of production.

TRUE

Doing business in Russia involves risks because the country has shown signs of shifting back toward greater sate involvement in economic activity and authoritarian government.

TRUE

Evidence suggests that technological change has had a bigger impact then globalization on the declining share of national income enjoyed by labor.

TRUE

Globalization critics argue that the decline in unskilled wage rates is due to the migration of low-wage manufacturing jobs offshore and a corresponding reduction in demand for unskilled workers.

TRUE

Non-U.S. firms increasingly began to invest across national borders because they wanted to disperse production activities to optimal locations and to build a direct presence in major foreign markets.

TRUE

One of the UN's central mandates is the promotion of higher standards of living, full employment, and conditions of economic and social progress and development.

TRUE

Rivers Inc., a U.S. based sports apparel manufacturer, sets up a production unit in China to take advantage of the lower labor costs there. This is an example of foreign direct investment.

TRUE

Supporters of debt relief argue that new democratic governments in poor nations should not be forced to honor debts incurred by corrupt and dictatorial predecessors.

TRUE

The costs of microprocessors continues to fall, while their power increases. This statement supports the predictions made by Moore's Law.

TRUE

The lowering of barriers to international trade enables firms to view the world, rather than a single country, as their market.

TRUE