INT BUS Exam #1

collectivism

An individual's right to do something may be restricted on the grounds that it runs counter to "the good of society" when the political system emphasizes collectivism. democracy. individualism. capitalism. privatization.

benefits

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? costs risks norms behaviors benefits

folkway

Madeline is always late to meetings. She knows she needs to improve her time management because it is a typical expectation in the United States. This attitude toward time is an example of a moral. belief. value. folkway. mores.

a market economic system

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

public action

The state senator was found guilty of __________ when she tried to overcharge for licenses and permits from an international business that wanted to open a manufacturing plant in her state. public transparency private violation public action foreign corrupt practices private theft

World trade organization

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

new trade theory

__________ 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

command

A __________ economy follows the principles of collectivism as resources are allocated based on "the common good." mixed private supply market command

grease payment

A payment made to expedite or to secure the performance of a routine governmental action is called a grease payment government fee. tariff. lump payment. protection payout.

demand conditions

Aesha works for a moderately priced running shoe manufacturer and while their products are lower in cost, there is a high degree of consumer pressure to create the best quality running shoes possible and to constantly innovate with new 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

mercantilism

Brianna lives in a nation that encourages the production of goods for exporting and to satisfy the needs of the nation's citizens. This results in the nation relying less on importing goods. Which trade theory does this reflect? new trade theory mercantilism theory of comparative advantage theory of absolute advantage Heckscher-Ohlin theory

international trade

Canadian company Nature's Yogurt exports a number of products to consumers in Brazil, Chile, and Argentina. According to this information, Nature's Yogurt is most likely involved in international trade. outsourcing. foreign direct investment. globalization of production. offshoring.

ethnocentrism

Charlize 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. Charlize's attitude is an example of ethnocentrism. Confucian dynamism. cultural convergence. collectivism. class consciousness.

dealing with business attacks from competitors

Deirdre works as the executive manager of an international business, while Tomas is the executive manager of a purely domestic business. Which of these responsibilities apply to both Deirdre and Tomas? 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

unethical

Farm-Supply Inc., which is headquartered in the United States, has its production plant located in a developing country where working conditions are poor. For example, employees work 12-hour shifts, are exposed to toxic chemicals, and are paid extremely low wages. The practices Farm-Supply Inc. is demonstrating could be labeled as unethical. just. uneconomical. fair. courageous.

every detailed with all contingencies spelled out.

Fenton Incorporated plans to do business with a company located in the Leone Republic, a common law country. The companies have agreed to draft the business contract in the Leone Republic. Since the contract will be drafted under a common law framework, it will be every detailed with all contingencies spelled out. short. less expensive than a contract drafted under a civil law system. somewhat general since many issues are already covered in the law. easy to draft.

high uncertainty avoidance

In the Republic of Nabu, natives are resistant to change and do not like to take risks. They value job security and retirement benefits. In addition, they have a strong need for rules and regulations. Based on this information, the Republic of Nabu demonstrates which cultural dimension identified by Hofstede? individualism femininity high uncertainty avoidance low power distance masculinity

individualism

In the United States, citizens have the freedom to pursue the economic and political activities that interest them. This is an example of the philosophy of totalitarianism. monarchism. individualism. anarchism. collectivism.

representative democracy

In the United States, citizens have the right to elect officials who make decisions on behalf of the public. This practice is the reason the United States is a tribal totalitarian regime. socialist state. theocratic state. representative democracy. pseudo-democracy.

the extent of entrepreneurial activity in a nation.

It has been noted that there is a connection between individualism that is fostered by Protestantism and the willingness of a country to import foreign goods. the extent of entrepreneurial activity in a nation. the growth of the caste system. government intervention in business activities. feminine-based societies.

power distance

Jamal operates a company that manufactures dog food. He pays his factory workers minimum wage, while he pays his managers twice as much with profit sharing. This represents which of Hofstede's cultural dimensions? individualism masculinity uncertainty avoidance class consciousness power distance

internal stakeholder

Marek owns 100 shares of stock in Sun Telecom. He would be considered a(n) internal stakeholder. mini-multinational. external stakeholder. customer.supplier.

political

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? ethical legal economic technological political

Multinational

Sun and Fun is a U.S.-based company that specializes in protective clothing to be worn at the beach or pool. The company recently opened a production facility in Brazil and another in Europe. What type of enterprise is Sun and Fun? local multinational private public semipublic

theory of comparative advantage

The basic message of the __________ 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

first-mover advantages

The economic and strategic advantages that accrue to early entrants into an industry are called mercantilist advantages. first-mover advantages. absolute advantages. comparative advantages. sustainable advantages.

don't consider differences in the cost of living.

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

a surplus in the balance of trade.

The mercantilist doctrine promoted government intervention in order to achieve global product consistency. higher prices on exported goods. more stable commodities. a surplus in the balance of trade. a decrease in factor endowments.

the promotion of greater competition.

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

culture

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.

totalitarianism

What political system has a government in which one political party exercises absolute control over all spheres of human life and doesn't allow opposing political parties to exist? right-wing totalitarianism democracy federalism socialism totalitarianism

The share of national income by skilled labor has increased.

Which statement accurately portrays the effect of the share of national income on skilled and unskilled labor? The share of national income by skilled labor has increased. The share of national income by skilled labor has decreased. The share of national income by unskilled labor has increased. The share of national income by unskilled labor has not changed. The share of national income by skilled and unskilled labor has not been affected.

moral courage

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

cultural relativism

f Shondra was working in the home office in Florida, she never would have agreed to pay the government official to speed up the delivery of the cargo; however, 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 Shondra using to make her decision? Kantian approach cultural relativism naive immoralism righteous moralism Friedman doctrine

do everything possible to abolish apartheid laws.

he 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.

Employees will achieve close cooperation with others.

A U.S. company is planning to expand its operations to Japan, where the group is the primary unit of social organization, and hiring locals as the primary employee base. According to this information, what is a likely outcome for this company when operating in Japan? 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.

deregulation

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

a closed totalitarian dictatorship

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

the presence of a strong legal system

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

firms will be reluctant to enter into such a country.

A country that has lax intellectual property laws will find that many companies in the country will focus on innovative products. firms will be reluctant to enter into such a country. imitating a patented product or process will become difficult. inventors and authors will have better opportunities to grow and to be rewarded. most of the companies in the country will commit themselves to extensive basic research.

a well-developed education system.

A country's national competitive advantage and its attractiveness as a location for international business are most influenced by the prevalence of communist ideals .a well-developed education system. the existence of a common religion. the presence of more than one language or culture. an emphasis on caste stratification.

zero-sum game

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.

Country B, where education is well-developed and social stratification is lacking.

A tool manufacturer is planning to set up a production plant abroad. It has selected five potential countries based on their population size, stage of economic development, labor costs, and access to world markets. Considering the connection between culture and competitive advantage, which country would be the best investment site for this company? Country A, where there is one prevalent religion and the society is characterized by a marked stratification between the upper and lower classes. Country B, where education is well-developed and social stratification is lacking. Country C, where education is well-developed and the society is characterized by a marked stratification between the upper and lower classes. Country D, where education is inconsistent and there are two prevalent religions. Country E, where education is undeveloped and there are seven major linguistic groups.

communication infrastructure

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

Globalization results in companies "exporting jobs" to low-wage nations.

According to globalization opponents, what is a disadvantage of globalization? Free trade limits countries from specializing in production of goods and services they can produce most efficiently. As a result of globalization, living standards of unskilled workers in developed nations have declined. Globalization results in companies "exporting jobs" to low-wage nations. Globalization makes it difficult for poor countries to export more of their agricultural production. As a result of free trade, the wage gap between developing and developed nations is broadening.

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

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.

civil law system

As a judge in Germany, William is not allowed to interpret the law but relies on a strict set of codes to determine the outcome of a case. Which type of law is in place in Germany? common law system civil law system mixed law system tribal law system theocratic law system

market

Daveed is the warehouse supply manager for a privately owned auto parts distributor. It is his job to take inventory of the products the company has available and place orders for parts when supplies run low. This supply and demand form of production is an example of a __________ economy. market command private public socialist

the fundamental rights of any stakeholders.

During the second stage of the ethical decision-making process, managers must determine whether a proposed decision would violate home country values. utilitarian beliefs. the global commons. the fundamental rights of any stakeholders. a righteous distribution.

product safety law

Josef told the management team that the company would have to find a new way to produce the Walk-A-Lot Doll because the government had recently banned "exposed component parts in toys" and the doll's walking mechanism was visible on her back. The standard set by the government is a type of tariff barrier. trademark. intellectual property law. private action. product safety law.

the shadow economy

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? tariff barriers deregulation privatization the shadow economy purchasing power parity

command and mixed economies failed to deliver sustained economic performance.

More nations have gravitated toward the market-based model because it gave full control of the economy over to the state.it did not allow for privatization. political freedom was guaranteed. command and mixed economies failed to deliver sustained economic performance. it is not associated with a set legal system.

lucky to be the first to produce the good.

New trade theorists would agree that a country might become dominant in the export of a good simply because it was eliminating supply conditions. provided with favorable government policies. achieving factor endowments. lucky to be the first to produce the good. following the lead of others.

World Bank

Of the two organizations created at Bretton Woods in 1944, which is considered the less controversial? World Trade Organization (WTO) International Monetary Fund United Nations (UN) Group of Twenty (G20) World Bank

pressure to meet unrealistic performance goals.

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.

grease payments

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.

product life-cycle

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

free trade

Simone lives in a country in which the government does not impose quotas on what can be imported or on what businesses can produce and sell to another country. What type of situation does this describe? a positive-sum game dumping free trade protectionism a zero-sum game

Country D, which has democratic institutions and a market-based economic system

Solar Solutions, a U.S.-based company, is planning to expand operations to a foreign country. Considering the factors that make a country attractive as a place in which to do business, which country should Solar Solutions consider for entry? Country A, which lacks democratic institutions and has a market-based economic system Country B, which has democratic institutions and where economic activity is heavily regulated by the state Country C, which has democratic institutions and where corruption is rampant Country D, which has democratic institutions and a market-based economic system Country E, which lacks democratic institutions and where property rights are always respected

sustainable strategies.

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. righteous strategies.

utilitarian

Sun-Jun 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

factor endowments

Tavis lives in southern Florida where there is sufficient land and labor to successfully grow gourds and melons. Heckscher-Ohlin would consider the land and labor to be location economics. resource allocations. factor endowments. innovative technologies. economies of scale.

foreign direct investment

Texas-based Cowboy Food Groups has invested resources in business activities in Mexico. What type of business activity does this represent? multinational exchange foreign direct investment exporting globalization of markets international trade

resolve disputes that arise in international trade regarding which country's laws to apply.

The United Nations Convention on Contracts for the International Sale of Goods (CISG) was introduced to specify the legal rights over the use to which a resource is put and over the use made of any income that may be derived from that resource .resolve disputes that arise in international trade regarding which country's laws to apply. make it illegal to bribe a foreign government official to obtain or maintain business over which that foreign official has authority. allow establishing ownership over intellectual property such as a computer software or a new drug. set up a legal mechanism that will help protect a firm when its product causes injury, death, or damage.

the only social responsibility of business is to increase profits, so long as the company stays within the rules of law.

The basic position of the Friedman doctrine says that businesses should undertake social expenditures beyond those that are mandated by the law. the only social responsibility of business is to increase profits, so long as the company stays within the rules of law. the best business decisions are those that produce the greatest good for the greatest number of people.a multinational's home-country standards of ethics are appropriate to follow in foreign countries. people should be treated as ends and never purely as means to the ends of others.

innovation

The development of new products, processes, organizations, management practices, and strategies is called deregulation. privatization. innovation. private action. protectionism.

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

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 economic model. New communication technologies have increased countries' ability to control access to uncensored information. Market-based economic systems have been replaced by command economies. There has been a significant reduction of the middle class. Democratic governments have been replaced by totalitarian governments.

The research team consisted of only Europeans and Americans.

What is one criticism regarding Geert Hofstede's research on cultural dimensions? It did not consider physical capabilities. The research team consisted of only Europeans and Americans It did not assume a one-to-one correspondence between culture and nation-state. It did not assess cultures affecting the workplace. It was too all-encompassing and did not allow for differences.

desire to disperse production activities to optimal locations

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

entrepreneurs

When Steve Jobs and Steve Wozniak cofounded Apple, they were acting as __________ since they were the first to commercialize this innovative new product. late-movers lobbyists engineers regulators entrepreneurs

microprocessor

When considering globalization, what is thought to be the single most important innovation since World War II? higher education containerization the telephone the microprocessor cross-country railway systems

new trade theory

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

justice theories

Which ethical approach typically focuses on the attainment of fair and equitable distribution of economic goods and services? utilitarian approaches justice theories rights theories straw men approaches Sullivan principles

Back Love Mattresses, a U.S.-based mattress company, sells the same mattresses worldwide.

Which of these companies exemplifies the globalization of markets? The running shoes of FootFast Inc., a U.S.-based company, are handmade 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. Back Love Mattresses, a U.S.-based mattress company, sells the same mattresses worldwide. Wolfson Industries Inc., a U.S. refrigerator equipment company, has generated capital from investors all over the world. Wine producer Tangy Tanins procures high-quality grapes from neighboring countries.

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

Which scenario best represents a mores violation? Showing up late to a meeting in a country where time is equivalent to money. Failing to shake hands in a country where shaking hands 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.

patent

Wise Eyes Corporation has developed a new oral supplement to prevent macular degeneration. Which type of legal protection grants Wise Eyes Corporation exclusive rights for a defined period to the manufacture, use, or sale of this new supplement? copyright treaty trademark warranty patent

convergence hypothesis.

With increased economic progress, cultures across the world seem to be moving toward some universally accepted values and norms. This is known as the ethnocentrism hypothesis. dynamism hypothesis. class consciousness hypothesis. convergence hypothesis. power distance hypothesis.

business ethics

Collin knows it is wrong for his company to continue pouring manufacturing waste products into the water system based on environmental standards set down by the state. Collin is demonstrating a lack of business strategies. business objectives. business ethics. business development. business goals.

globalization

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

purchasing power parity

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? factor endowments gross domestic product return on investment cash reserve ratio purchasing power parity

carbon dioxide

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

absolute advantage

If France is more efficient at producing fine wines than other nations, then France has a(n) mercantilist advantage. first-mover advantage. absolute advantage. comparative advantage. unsustainable advantage.

privatization

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 communism. protectionism. nationalization. privatization. socialism.

the market mechanism

In his theory of absolute advantage, Adam Smith advocated that __________ should determine what a country imports and what it exports. government policy the market mechanism social mores political parties foreign entities

an ethical dilemma

Manny, an American executive, learns that a foreign subsidiary hired a 10-year-old orphan boy 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 his only source of income is right. Manny is facing the stakeholder doctrine. the tragedy of the commons. positivity effect.an ethical dilemma. the sustainability effect.

norms

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

socioeconomic characteristics.

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

Labor

What is an example of a factor of production? environment competitors component parts government labor

Mandarin

Which language is spoken as the mother tongue by the largest number of people in the world? Mandarin French English Spanish Hindi

righteous moralism

Which philosophical approach claims that a multinational's home-country standards of ethics are the ones employees should follow even when working in foreign countries? Sullivan principles cultural relativism naive immoralism righteous moralism Freidman doctrine