Chapter 3

(T/F) In international licensing, the licensor is the domestic firm that allows the license to use its trademark or brand.

True.

(T/F) International trade-dependent jobs have grown at a rate three times the growth of U.S. dependent jobs.

True.

(T/F) When Coca-Cola sends cases of Coke to France and receives sparkling water as payment, a countertrade has taken place.

True.

A country that imports more goods that it exports is said to have a(n)...

Unfavorable balance of trade.

(T/F) Expropriation is a political risk in which a country seizes the assets of a foreign firm and does not compensate the firm.

False.

(T/F) Having a global vision simply means having a willingness to sell outside one's national borders if, and when, the opportunity arises.

False.

(T/F) The exchange rate is the interest rate that foreign banks receive when borrowing money from the United States.

False.

A country that exports more goods than it imports is said to have a(n)...

Favorable balance of trade.

Currency markets operate under a system called ___. This means that prices of currencies vary based upon demand and supply of that currency.

Floating exchange rate.

Canadian logging companies sell timber in the United States. To the U.S., the timber is a(n) ___, and for Canadians, the timber is a(n) ___.

Import; export.

(T/F) A countertrade in international terms pertains to the sale of retail goods that are usually sold "over the counter".

False.

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

Balance of payments.

The ___ is defined as the difference in value of a country's exports and imports over a period of time.

Balance of trade.

The ___ is the value of one currency in terms of another.

Exchange rate.

Botswana produces diamonds, copper, nickel, soda ash, meat, and textiles, which it sells to the members of the European Union. To Botswana, the diamonds, copper, nickel, soda ash, meat, and textiles it produces are examples of...

Export.

___ are goods and services that are made in one country and sold to other countries.

Exports.

A company that has a global vision...

Recognizes and reacts to international business opportunities.

How has terrorism affected global trade?

Terrorism has curtailed the liberal inflows of skilled and blue-collar workers.

(T/F) The International Monetary Fund (IMF) was created to promote trade through financial cooperation by working to eliminate trade barriers.

True.

(T/F) The difference in value between a country's imports and exports is called its balance of trade.

True.

(T/F) The need for businesses to expand their markets is one of the most fundamental reasons for the growth in world trade.

True.

(T/F) The opposite of free trade is protectionism.

True.

(T/F) The tax that the United States imposes on imported carbon steel products is called a tariff.

True.