International Business Final Exam

Grease payments are considered an acceptable form of a

bribe

Current trends indicate that, due to the emerging economies, the world is moving ______ an economic system that is more favorable for international business.

closer to

A government plans the quantity of goods and services produced as well as the prices at which they are sold in a pure _________ economy.

command

A country that bases its laws on the traditions within the country's legal history operates under a ______ law legal system.

common

Based on the political party beliefs of the governments of China and North Korea, these countries practice ______ totalitarianism.

communist

As figures for 2019 reflect, the globalization of the world economy has resulted in a relative _____ in the dominance of U.S. firms in the global marketplace.

decline

Distribution of production to separate locations has become more economical for companies because transportation costs have ______.

declined

When product safety laws are more stringent in a firm's home country than in a foreign country the firm is entering, the most ethical thing to do is to follow ______ standards.

home-country

A(n) ______ is any business that has productive activities in two or more countries.

multinational enterprise

Plato would have agreed that society should be stratified into classes and ______ were best suited to rule society.

philosophers and soldiers

The term ______ is used to stress that the political, economic, and legal systems of a country are connected.

political economy

Which continent has experienced tribal totalitarianism rule?

Africa

During the 1920s and 1930s, when high tariffs were placed on imported manufactured goods,

An increase in trade barriers resulted

What is the best description of the globalization of markets?

Bringing traditionally separate national markets into one cohesive marketplace

Which environmental concern has been found to rise steadily with higher-income levels?

Carbon dioxide emissions

Based on current trends, the economy of ______ could ultimately be larger than that of the United States.

China

Jarek has been asked to give a characteristic of a command economy to the class. What should he say?

Command economies do not make innovation a priority and, therefore, tend to stagnate.

The globalization of markets is facilitated by

Improvement in transportation technology

A debt relief movement was in full force in the late 1990s; however, in order for these programs to have a long-term impact it is necessary for those nations receiving debt assistance to

Invest in public projects that boost economic growth.

In the early 1960s, the U.S. was the world's dominant industrial power. How does the U.S. position compare today?

It has diminished in power.

What statement BEST defines right-wing totalitarianism?

It restricts political freedom, frequently on the grounds that it would lead to the rise of communism, but does allow some economic freedom.

Which one is considered more controversial: The International Monetary Fund or the World Bank?

The International Monetary Fund

Which global institution is the successor to GATT?

The World Trade Organization

What is the best way to characterize the impact of existing impediments to globalization?

The impediments make it difficult for companies to maximize production activities.

______ often back(s) right-wing totalitarianism governments.

The military

When examining the data from 1960 to 2020, how does the value of the world economy compare to the value of international trade?

The value of international trade has a greater increase.

Which statement best exemplifies a political system?

Typically, the political system of a country can be assessed by the degree to which it is democratic or totalitarian.

What is an accurate depiction of Latin America when considering international business?

While favorable economic trends have recently occurred, there is no guarantee that they will continue.

How did the COVID-19 pandemic affect world trade in 2020?

World trade fell by around 8%.

Boeing's rationale for outsourcing so much production to foreign suppliers is based on which two factors, according to the text?

- Increasing the chance to win significant orders from airlines in those countries - Using suppliers that are the best in the world at a particular activity

What are the four purposes of the United Nations according to its charter?

- be a center for harmonizing the actions of nations - cooperate in solving international problems - develop friendly relations among nations - maintain international peace and security

he communist version of socialism reached its peak in the ______ and by the ______ it was in a state of collapse.

1970s; 1990s

In the early 1990s there were fewer than 50 bilateral and regional trade agreements between two or more nations. This has changed today as there are about

300

Boeing outsources a large portion of its production. For example, for its most recent jet airliner (the 787), nearly ______ of the total value of the aircraft is outsourced to foreign companies.

65%

What percentage of world trade do the nations that are members of the WTO account for?

98%

If you were asked to provide a fact about a common law system, what should you say?

A common law system has a degree of flexibility that other legal systems lack.

Supporters of globalization say that critics do not understand that the benefits of free trade outweigh the

Costs.

One outcome of the globalization of markets is a decrease in the intensity of competition among companies.

False

True or False: Unlike the economic system of a country, the legal system is NOT influenced by the prevailing political system.

False

True or false: Small and medium-sized companies do not typically benefit from the globalization of markets.

False

The G20 was originally established to

Formulate a coordinated policy response to financial crisis in developing countries

In the 1960s, when a customer in the United States purchased a television, that television had been manufactured in the United States. Today, thanks to the fall of international trade barriers, televisions purchased in the United States might be manufactured in China or South Korea. This change has occurred as the result of ______.

Globalization

Until the COVID-19 pandemic affected the economy, the value of FDI over the last 30 years

Had grown significantly

According to many business executives, what makes American businesses less competitive in the global marketplace?

High costs of liability insurance in the United States

The risks of doing business in countries that are facing revolutions is

Higher than in countries not facing revolutions.

What is an accurate depiction of containerization

It reduces the costs of shipping goods over long distances.

Which statement accurately describes the globalization of markets?

National differences in tastes and preferences for consumer products is an important factor that acts as a brake on globalization.

Which Greek philosopher is credited with advocating the origins of collectivism?

Plato

What is a difference between the contracts drafted in a common law framework and those in a civil law system?

Resolving contract disputes in a common law system tends to be more adversarial than in civil law systems.

The text notes that there are two macro factors fueling the trend toward greater globalization. These two factors focus on a decline in trade barriers and

Technological change

Which organization would help out a cash-strapped government with a low-interest loan to help that country build new roads?

The World Bank

A "Black Swan" event, such as the COVID-19 pandemic, can create large negative consequences in the economy even though

There is a low probability for this type of event.

In terms of economic growth, current indicators suggest that

There will be stagnation among the world's poorest nations.

What is an accurate description of Ralph Nader's view of supranational organizations such as the World Trade Organization

These organizations run counter to the basis of democracy.

What statement characterizes social democrats of the early 20th century?

They believed in achieving socialism through non-violent means.

What is an accurate description of microprocessors?

They provide a low-cost way to process large amounts of information.

Why do companies engage in the globalization of production?

To lower their overall cost structure or improve the quality of their product offering

Which U.S. president decided to pull the United States out of the Paris Accord, thereby eliminating the need for the united States to participate in limiting future CO2 emissions?

Trump

Which of the following statements about political systems is TRUE?

Typically, political systems that place a high emphasis on individualism tend to be democratic.

What is an example of a regional trade agreement that has reduced trade barriers between nations?

USMCA (United States - Mexico - Canada Agreement)

What global institution was established October 24, 1945 and one of its key purposes is to maintain international peace and security?

United Nations

Half a century ago, which country dominated world foreign direct investment?

United States

The International Monetary Fund (IMF) has been criticized for

compromising the jurisdiction and decision-making powers of the receiving country.

A(n) ______ is a document that specifies the conditions under which an exchange is to occur, detailing the rights and obligations of the involved parties.

contract

Critics of globalization protest in order to ______.

diminish the impact of the culture of multinational enterprises on the world

The national differences in the quality of factors of production help companies

improve the quality or functionality of their product offering.

The outward stock of foreign direct investment has ______ for the world as a whole since 1995.

increased

A company is involved in foreign direct investment when it

invests in business activities outside of its home country.

Those who support globalization argue that increasing globalization will

lead to reduced prices for goods and services.

Based on the fact that the volume of world trade has been growing faster than world GDP implies that the economies of the world's nation-states are becoming

more intertwined.

By the year 2020, ______ of the world's population were Internet users.

more than 60%

Shondra's company developed a new method for sealing medication bottles and has decided to license their patented method to the leading drug manufacturers in the United States. Shondra's company has the legal right to do this based on the ______ rights they have for this method.

property

Under a(n) ______, authoritarian elements are used to attempt to deny basic political and civil liberties to individuals.

pseudo-democracy

The number of mini-multinationals involved in international trade and investment is ______.

rising

From the 1990s until today, foreign direct investment inflows can best be described as

surging and slumping

Some U.S. hospitals outsource radiology work to India. This is possible because of advancements in Blank______.

technology

Compared to contracts drafted in a common law system, contracts in a civil law system

tend to be much shorter and less specific.

The presence of McDonald's in Tokyo, the opportunity to easily buy iPads in Rio and Berlin, and the ready availability of Gap jeans in Paris as well as San Francisco are examples of

the emergence of global markets for consumer products.

Hanson Housewares Inc., based in Tennessee, sources goods from Southeast Asia to take advantage of labor cost savings. This is an example of Blank______.

the globalization of production

The three main types of legal systems found around the world include common law, civil law, and ______ law.

theocratic

Supporters of globalization suggest that a solution to the problem of slow real income growth among unskilled workers is ______ society's investment in education.

to increase

While studies show that the share of labor in national income has declined over the past two decades, experts caution that in reality the decline has only affected

unskilled labor.

Select the correct statement about democracy and totalitarianism.

It is possible to have a democratic state in which some degree of collectivism exists.

The purpose of the Uruguay Round negotiations was to

Lower the trade barriers between various national markets

What two countries are responsible for the largest emissions of carbon dioxide?

United States China

Select the four facts that describe the demographics of the global economy a half a century ago.

- U.S. dominance in the world economy and world trade - U.S. dominance in world foreign direct investment - Dominance of large, multinational U.S. firms in the international business scene - Roughly half of the globe was off-limits to Western international business

Beginning in the 1970s, European and Japanese firms began to shift labor-intensive manufacturing operations to developing nations with ______.

lower labor costs

Moore's Law predicts that

microprocessor technology power will double approximately every 18 months.

In a common law system, ______ refers to cases that have come before the courts in the past.

precedent

According to the critics of globalization, increased free trade and investment over the past few decades have

widened the gap between the rich and poor nations.

What is a challenge faced by companies entering the global market?

Differences in consumer tastes and preferences

What is an example of an obstacle to globalization?

Differences in legal regulations among national markets

Which organization is responsible for policing the rules of trade between nations and making sure countries adhere to the rules of trade treaties signed by member states?

World Trade Organization

The G20 is comprised of ______ from the 19 largest economies in the world.

finance ministers

The ______ system of a country refers to the rules, or laws, that regulate behavior along with the system that enforces them.

legal

In a pure ______ economy, all productive activities are owned privately -- they are not owned by the state.

market

Which country imposed immediate lockdown measures to contain the coronavirus in 2019 and now appears to be coming out of the pandemic better than most nations and may emerge stronger?

China

Michael works at a lawnmower manufacturing company in St. Louis, Missouri, and his company imports component parts from Thailand and also ships the final product to various countries. Michael's company is an example of a(n) __________ business.

International

What is an accurate depiction of the World Bank?

It focuses on helping developing countries to fight poverty through investments in the underlying structure of the country.

Which statement accurately describes a civil law system?

Unlike a common law system, a civil law system relies on detailed codes, and therefore, can be less adversarial.