Business Chapter 4- International Business

Suppose Apple builds a plant in Taiwan and agrees to take 30% of the plant's output as partial payment for the contract. This is called:

Buyback

The reasoning behind the creation of the Euro can best be explains as a means to:

Integrate the European countries

Which of the following is NOT true about NAFTA?

NAFTA helps the US, but harms Mexico

According to Adam Smith, the party which can produce more of a good or service than competitors while using the same amount of resources, is said to have:

Absolute advantage

In order to be a successful joint venture, both parties must be equally invested in a project in terms of:

All of these answers (Effort, Time, Money)

Assuming the US is efficient in growing corn and therefore sells it to other countries. We call this:

Exporting

The term balance of trade incorporates the measure of which of the following?

Imports and Exports

Assume you own an American office supplies company. Which part of your business process would most likely be relocated to another country?

Manufacturing

One of the downsides of outsourcing for a company is that it:

Reduces confidentiality

Complete the following sentence. Tariffs, as they relate to global trade, are:

Taxes on imports

The most significant update to the GATT in 1993 was:

The establishment of the WTO

The one reason MNC can be harmful for the host country is:

They obtain strong negotiating power with local government

Suppose you, as an american company, started a phone business in India. Which of the following cultural barriers might you face?

All of these answers (Market entry, ignorance of emerging markets, transaction complexity)

The World bank incorporates which of these studies in fighting poverty of developing countries?

All of these answers (economic situation, local groups' actions, financial situation)

The Bogor Goals adopted in 1994 called for:

All of these answers (open investment in Asia-Pacific, Free and open trade in Asia-Pacific for developing economies, free and open trade in Asia-Pacific for industrialized economies)

A company might put money in FDI because:

All of these answers (tax advantage, high return, cheap labor)

Tariffs are often viewed by economists to be bad for overall welfare because:

All of these answers (they are anti-poor, they limit choices for products, they hurt the developing world)

Which of the following is NOT a benefit of contract manufacturing?

Complete control of production