Chapter 3 business principles

The difference in value between a country imports and exports is called in which they are headquartered.

True or False

If a country specializes in goods that it can produce most readily and cheaply and trades those goods for the goods that another country can produce most readily and cheaply, then both countries are exercising the principle of:

A) Absolute advantage B) Economics of scale C) Distinctive advantage D) Parallel competencies E) Comparative advantage

The difference between a country's total payments to other countries and its total receipts from other countries its called its:

A) Balance of trade B) Financial surplus C)Financial deficit D) Balance of exchange E) Balance of payments

_____ move resources, goods, services, and skills across national boundaries without regard to the country in which they are headquartered.

A) Multinational corporations B) Borderless corporations C) International monpolies D) Cartels E) Oilgopolies

In a complicated negotiated, Minmetals in China agreed to purchase at least 24,000 tons of copper cathode for $35 million from Pasar in the Philippines. According to the terms of the sale, Pasar will provide at least $12 million worth of coal to a Chinese power company that will provide the electricity needed to operate Minmetals. This is an example of a(n):

A) Joint venture B) Countertrade C) Contra-deal D) Countertrade C) International partnership

_____ are laws that require a company earning foreign currency from its exports to sell the foreign currency to a control agency, usually a central bank.

A) Currency poilcies B) Rates of exchange C) Laws of balanced exchange D) Favorable exchange regulations E) Exchange controls

When South Korea reduces the tariff that Japan ( but only Japan ) has to pay when it imports cameras into South Korea, it is called a:

A) Differential duty B) Biased tariff C) Nontariff D) Preferential tariff E) Customary duty

____ is the reduction of a currency's value relative to another currency

A) Evaluation B) Devaluation C) Currency leveling D) Deregulation E) Exchange depreciation

Canada is currently the second largest producer of nickel in the world. The reopening of the world famous Voisey's Bay mine, which has total resources estimated at 124 million tons of nickel-bearing ore, should give Canada a clear:

A) Total advantage B) Advantageous competency C) absolute advantage D) Core strength E) Comparative advantage

Why do many people fear trade and globalization?

A) Trade and globalization will increase per capita income B) An open economy spurs innovations with fresh ideas from abroad C) Many fear trade and globalization lead to increased productivity D) Free trade and globalization will lead to massive job losses. E) Export jobs often pay less than other jobs

The difference between a countrys total payments to other countries and its total receipts from other countries it called its:

A) balance of trade B) Financial surplus C) Financial deficit D) Balance of exchange E) Balance of payments