CBA 396 Chapter 6
A comparison based on hourly wages is a reasonable guide to a need to protect domestic jobs.
False
A historical function of capitalist-- but not communist-- governments has been the protection of the economic activities within their geographic area of control
False
Businesses favor unstable governments b/c the present more profit oppurtunities
False
Country risk assessment is an evaluation that assesses a country's political situation and policies to determine how much risk exists of a change in that country's government.
False
County risk assessment is a measure of the threat of nationalization
False
Fair competition is a strong rationale for trade barriers
False
Former British prime minister Tony Blair led the privatization movement
False
Kidnap, ransom, and extortion are techniques often used by terrorists against which no insurance is available,
False
One example of nationalization of private companies is the nationalization of French-owned firms in Europe after World War II.
False
One way that the WTO defines dumping is the selling of a product abroad for less than the average cost of production in the importing nation.
False
Only in communist countries do governments own the factors of production.
False
Paying ransom makes sense because a life is saved and the payments can be traced
False
Protection of infant industries through trade restrictions is used only in developing nations.
False
Retaliatory trade restrictions are not made for dumping because price competition is protected by the WTO.
False
Sanctions are a trade restriction that is effective in forcing change
False
Terrorists avoid kidnapping because the repercussions can be harmful to their movement.
False
The government officials who make decisions about import restrictions are particularly sensitive to their country's broad population of consumers, who will be hurt by international competition.
False
The length of the investment in a foreign country has no impact on the risk assessment for that investment. What matters is the economic and political situations in the country.
False
The national defense argument for trade restrictions is based on the development level of the country
False
The only reason firms are nationalized is to spread a socialist-communist ideology
False
The practice of country risk assessment is an exercise in xenophobic and ethnocentric thinking
False
The types of information a firm will need to judge country risks vary according to the nature of its business and the amount of money invested.
False
The utility of risk analyses of social, political, and economic factors increases rapidly over longer time spans.
False
Unlike the topography, the political climate of a country has relatively little influence on its exports
False
When government-owned companies compete with private companies, the private companies have the advantage.
False
When people are kidnapped for ransom, the right response is to pay the ransom, get the hostages released, then relatialte
False
Country risks are increasingly political in nature
True
Policy continuity and government stability are more important to a business that the type of political system.
True
To hedge the terrorism risk, there are insurance, anti-terroist schools, and even companies to handle negotiations
True
To protect an infant industry, trade restrictions might be effective
True
Trade restrictions violate the spirit of the WTO
True
U.S. ocean shipping companies are benefiting from U.S. government subsides
True
When the U.S. military contracts out security details in war zones, it is engaged in privatization
True
Zimbabwe's government offers an example of government instability
True
