MGT302 Exam 1

True or False: Supporters of globalization argue that bodies such as the World Trade Organization and the United Nations exist to serve the collective interests of member states, not to subvert those interests.

True

Through the 1960s, which country dominated world foreign direct investment?

US

globalization of markets

bringing traditionally separate national markets into one cohesive marketplace

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

Apple's production presence in China

creates both low skilled and engineering level jobs

Opponents of globalization are concerned that manufacturing jobs will be moved to more _____ countries.

developing

The opponents of globalization argue that falling barriers to international trade

eliminate manufacturing jobs in wealthy economies.

Influential economists, politicians, and business leaders who favor globalization argue that

falling barriers to international trade drive the economy toward greater prosperity.

Apple sources parts for its iPhone from around the world before assembling the phones in China. This reflects the

globalization of production

Which one of the following statements is TRUE about microprocessors?

They can decode vast amounts of information.

Who is responsible for policing the rules of trade between nations and making sure countries adhere to the rules of trade treaties?

WTO

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

multinational enterprise

The main factor driving Apple's decision to locate its iPhone production in China was

speed

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

international

Those who support globalization argue that increasing globalization will

lead to reduced prices for goods and services.

The decline of the United States' standing as a dominant industrial power is considered a(n) _____ decline because it reflects the faster economic growth of other economies.

relative

Company XYZ, based in Idaho, sources goods from Southeast Asia to take advantage of labor cost savings. This is an example of _____.

the globalization of production

There have been two notable trends in the demographics of multinational enterprises since the 1960s. These include _____.

the growth of mini-multinationals the rise of non-U.S. multinationals

Globalization

the shift toward economic international integration

Which of the following is a concern voiced by critics of globalization?

An interdependent global economy shifts economic power away from national governments and toward organizations such as the United Nations.

Which of the following statements regarding conducting international business in China is TRUE?

China represents a large -- basically untapped -- market.

Which of the following statements accurately describe the global economy in the twenty-first century?

More nations are becoming part of the developed world.

The text lists several reasons that stand out as the cause for economic stagnation in the world's poorest countries, including which three of the following?

Poor property rights protection Totalitarian governments Prolonged civil war

Why do companies engage in the globalization of production?

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

What are the four facts that describe the demographics of the global economy up until the 1960/s

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

Those who promote the idea of free trade say that one way for the world's poorest countries to improve their situation is to _____.

adopt economic policies based on free market economies

What are the two macro factors that underlie the trend toward greater globalization?

decline in trade barriers technological change

Critics of globalization protest in order to

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

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

globalization

The stock of foreign direct investment has _____ in the United States, China, Japan, and the United Kingdom since 1995.

increased

A(n) ______ business is any firm that engages in cross-border trade or investment.

international

The primary reason Apple established production facilities in China for its iPhone was to capitalize on

the ability of subcontractors to rapidly respond to changes in demand

Historically, national markets were distinct and separate entities. Today, these separate national markets have merged. This process is known as _____.

the globalization of markets

The stock of foreign direct investment refers to the ______ of foreign investments as a percentage of the country's GDP.

total cumulative value

Apple's investment in production facilities in China to produce its iPhone can best be described as

FDI

Marilyn's U.S.-based shoe company has decided to invest in a British company that specializes in clasps and buckles. This would be an example of

FDI

Which of the following issues are raised by antiglobalization demonstrations?

Falling barriers to international trade results in job losses in those industries targeted by foreign competitors.

True or False: While there are a large number of nations that are members of the WTO, these nations account for only a small portion of world trade.

False

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.

In terms of international business, which of the following statements accurately describes Latin America?

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

The development of the microprocessor has lead to _____.

a reduction in the cost of global communications

Critics of globalization point out that free trade

allows firms to abuse the weak labor and environmental laws in developing countries

When a company invests in a company or entity outside its home country, it is participating in

Foreign Direct Investment