management test 3

Which of the following characteristics relates to the North American Free Trade Agreement (NAFTA)? a. Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries b. Effectively merged Canada, the United States, and Mexico into one market of about 400 million consumers by eliminating most tariffs and trade restrictions on agricultural and manufactured products among the three countries c. A global association of member countries that promotes free trade d. Allows selected American firms desiring international trade to form monopolies in order to compete with foreign cartels

B

When Reebok has some of its athletic shoes produced by a Korean company, but the Reebok name still appears on the shoes, this illustrates a. contract manufacturing. b. licensing. c. direct investment. d. exporting

a

You are an apple farmer and spokesperson for the American Apple Association. You are faced with severe dumping from apple growers in Transoceania, where apples grow wild and the people pay to pick apples as a form of recreation. To counter this threat, you are going to lobby Congress and the president to a. impose a protective import tariff. b. boycott foreign fruit and produce. c. enact an embargo on exported fruit. d. take legal action on apple importers.

a

What is the World Trade Organization (WTO)? a. Comprised of ten Southeast Asian countries with the goal to promote economic growth and overall progress in the area via trade and security b. An economic and political union of 28 member nations that are located primarily in Europe c. A global association of member countries that promotes free trade d. An international economic organization comprised of 30 countries that accept the basic principles of free-market economies and representative democracy; recommends and promotes policies to improve the well-being of consumers and societies across the world

c

You are the executive vice president of Banana Computer, Inc. You have a competitive machine, but your major competitor has the benefit of large-scale production, making its products less expensive to manufacture. In order to remain price-competitive, you send your parts and subassemblies to Mexico for the final stage of assembly, thereby taking advantage of a. direct investment. b. contract manufacturing. c. outsourcing. d. a strategic alliance

c

The agreement between Japan's Sony Corporation and the Swedish telecommunication company Ericsson to make mobile phones is an example of a a. direct investment. b. cartel. c. joint venture. d. strategic alliance.

d

You are the president of Henry Motor Corp., and you see the great potential markets in Eastern Europe for personal transportation. Your plan is to purchase an old Soviet tank plant and convert it into an auto factory. The Russian government welcomes your plan, which is an example of a. contract manufacturing. b. a strategic alliance. c. a joint venture. d. a direct investment.

d