Intro to business chapter 3 review

Most experts believe that trade controls, such as tariffs, quotas, and subsidies, are beneficial to the world economy.

False

U. S. exports are greater than U.S. imports.

False

If a country buys more goods and services than it sells over a specified period of time, it has a _____. a. trade surplus b. trade deficit

b. trade deficit

A reliable banking system, a strong stock market, and a government that discourages corruption while encouraging investment and competition are all conducive to economic growth.

True

As a U.S. farmer who receives a subsidy, you're guaranteed a certain price for your output regardless of the market price.

True

Companies doing international business often face a smorgasbord of inconsistent laws and regulations

True

In economic terms, "balance of payments" refers to the difference between a country's total outflows and inflows of money over a period of time.

True

Many multinational corporations (MNCs) have adopted the motto "Think globally and act locally."

True

The _____ prohibit(s) the distribution of bribes and other favors among American business people conducting business with foreign officials and business people. a. Foreign Corrupt Practices Act b. Anti-Bribery Act c. Ten Commandments d. Sarbanes Oxley principles

a. Foreign Corrupt Practices Act

. If the U.S. dollar goes down relative to a foreign currency, buyers using that currency pay ____ for American goods and services. a. less b. more c. in American currency d. exorbitant prices

a. less

A country's level of economic development is related to its _____. a. standard of living b. trade surplus c. currency exchange rate d. immorality rate

a. standard of living

What's the international language of business? a. Spanish b. English c. Japanese d. Chinese

b. English

Basically, nations trade: a. because most nations tend to have yearly surpluses of goods. b. because no nation's economy can produce all of the goods and services that it needs. c. in order to maintain peaceful relationships with neighboring countries. d. in order to stockpile goods in case of national disaster or emergency.

b. because no nation's economy can produce all of the goods and services that it needs.

High domestic ____ costs have made international contract manufacturing, or outsourcing, attractive to many U.S. companies. a. building b. material c. labor d. marketing

c. labor

When it sets controls to protect domestic industries by reducing foreign competition, the federal government is _____. a. fighting corruption b. restricting immigration c. practicing protectionism

c. practicing protectionism

_____ is a necessary step in gearing your undergraduate education toward a career in international business. a. Developing real expertise in one of the basic areas of business b. Developing your knowledge of international politics and economics c. Developing foreign language skills d. All of these

d. All of these

Generally speaking, nations tend to _____. a. exploit their production and trade advantages b. benefit from specialization c. trade their output based on what they do best d. does all of these things

d. does all of these things

According to the principle of _____, a country that decides to specialize in the production of a particular product must sacrifice the production of another product. a. comparative advantage b. absolute advantage c. cross production d. opportunity cost

d. opportunity cost