Chapter 5 Bus 280

True or false: A compound duty is a combination of specific and nontariff barriers.

False

True or false: A compound duty is stated as a percentage of the invoice value of the product.

False

True or false: Import duties mean lower prices for the consumer.

False

True or false: In most parts of the world, you will not find government-owned businesses.

False

True or false: Sanctions are effective at achieving their goal of forcing change in the targeted country.

False

What area, particularly related to the Internet, is of increasing concern to governments as they try to protect the business activities of their citizens?

cybercrime

Economists argue that the best way to protect national security and provide for national defense is through _________

direct government subsidies

Economists argue that the best way to protect national security and provide for national defense is through __________

direct government subsidies

Which of the following cybercrimes are most often targeted at businesses?

domain-related offenses hacking data espionage

Julie's company imports all of its athletic shoe products from outside of the United States because it can obtain them for a lower cost based on the lack of environmental standards found in some countries. Those countries are engaged in ____________ dumping

environmental

Voluntary export restraints are export quotas imposed by the

exporting nation

in __________ kidnapping, the victim is kidnapped, often near an airport or international hotel, and forced to withdraw money from cashpoints or an ATM before being released.

express

In 2012, the Argentine energy company YPF was taken over by the Argentine government because the government said YPF was not investing sufficiently in the country. The government takeover of YPF is an example of nationalization or ________

expropriation

Quotas are usually global in nature, with the total amount ____________ regardless of the source.

fixed

As a result of WTO agreements, nontariff barriers have

gained greater importance.

After expropriation occurs, a business is owned by the _________________

government

International firms can be protected from terrorism and cybercrime through __________ (business/government) actions.

government

Tariffs are also called _________ duties.

import

Customs is a general term for duties paid on

imports

When governments impose trade restrictions, the cost of the traded goods will ____________

increase

During Margaret Thatcher's tenure as prime minister of Britain, she decreased the number of state-owned companies and sold more than 30 companies, thereby raising $65 billion for the country. This is an example of _____________

privatization

The selling of government-owned businesses to the private sector is known as ____________

privatization

What are some of the reasons a government would restrict trade?

promote national defense preserve domestic jobs protect domestic infant industries

Which quantitative nontariff barrier sets numerical limits for specific kinds of goods that a country will permit to be imported during a specified period?

quota

Which one of the following would be recognized in a country risk assessment?

revolution against the government

A country ____________ assessment reviews a country's economic situation and politics to determine how much risk to employees, property, and investment exists for firms doing business there.

risk

Dumping is defined in several ways. Which of the following are definitions of dumping? (Check all that apply.)

selling a product abroad for less than the cost of production selling a product abroad for less than the price in the home market selling a product abroad for less than the price to third-party countries

Unlawful acts of violence committed to achieve a variety of objectives are collectively known as

terrorism

Which country was the first to prohibit the dumping of foreign goods into its own market in 1916?

the United States

Which of the following are characteristic of a stable government?

maintains itself in power predictable fiscal policies predictable monetary policies

When governments ________ private firms, they take them from private to public ownership.

nationalize

In 2020, U.S. trade policy included active sanctions against which three countries?

North Korea Sudan Libya

Which is an example of a government-owned business in the United States?

Export-Import Bank

Supporters of fair competition suggest that an import__________ will bring the cost of imported goods up to the cost of domestically produced goods.

Duty

What are the potential drawbacks to placing a ban on the export of advanced technologies? (Check all that apply.)

It impedes the funding of continued innovation. It reduces export revenues for the country's manufactures. It impedes efforts to sustain international market share.

What was the result of the Smoot-Hawley Tariff Act?

It increased tariffs on many items in many industries.

Because ______ has a national trade policy, its government intervention in trade reflects a government trade strategy.

Japan

A variable ______________ guarantees that the market price of the import will be the same as that of domestically produced goods.

Levy

_______________ is when a government takes a private firm to public ownership.

Nationalize

absolute

Once the specified amount has been imported, further importation for the rest of the period is prohibited.

___________ is hijacking that includes kidnapping on the seas.

Piracy

______ dumping occurs when producers have lower wage rates, lower social costs, poor worker benefits, and poor working conditions.

Social

Which of the following statements are accurate regarding the cost-of-labor argument? (Check all that apply.)

The cost-of-labor argument does not take into account relative productivity rates of workers in different countries. Comparing low foreign hourly wages to domestic hourly wages is misleading. Wages do not account for all the labor costs.

allocated

The government of the importing nation assigns quantities to specific countries.

global

The total amount is fixed without regard to source.

Why do so many kidnappers target businesspeople?

They assume businesses have a lot of money and want to protect their workers.

Which of the following are characteristics of nontariff barriers? (Check all that apply.)

They can be quantitative and nonquantitative. They are forms of discrimination against imports. They impose additional costs on producers. They impose additional costs on customers.

True or false: A national system of law can minimize unfair international competition.

True

The area of dumping, its regulation, prosecution, and prevention is under which organization?

WTO

Which of the following challenges can unstable governments present to businesses?

a pattern of unpredictable change inability to ensure peace

A pharmaceutical firm pays import duties that are stated as a percentage of the invoice value of the product. This is an example of what type of tariff?

ad valorem

Economists agree that political barriers to trade ________

are detrimental to trade reduce economic efficiencies

Subsidies can take the form of

cash payments to the firm government participation in ownership preferential tax treatment

Those who believe it is important to protect infant industries claim that, in the long run, these industries will have a(n) ______ advantage, but in the meantime these firms need protection from imports.

comparative

A(n) __________ duty is a combination of specific and ad valorem duties.

compound

What are the three types of tariffs?

compound ad valorem specific

What is the general term for duties paid on imports?

customs

Any illegal Internet-mediated activity that takes place in electronic networks is called__________

cybercrime

Which methods can a government use to minimize unfair international competition?

negotiations between governments national laws institutions such as the WTO

Direct government participation in trade, customs and other administrative procedures, and standards are all

nonquantitative nontariff barriers

Tariffs assessed at very low rates are called

nuisance tariffs

A(n) ______ is a formal agreement between the governments of exporting and importing countries that stipulate the import or export quotas each nation will have for a good in order to restrict international competition and preserve some of the national market for local producers.

orderly marketing arrangement

U.S. cargo ships have been hijacked by groups from West Africa who demand money for the release of the ship. This form of hijacking is called ____________

piracy

What are the four areas of increasing concern to governments as they try to protect business activities?

piracy kidnapping terrorism cybercrime

When a manufacturer lowers its export price to force the importing nation's domestic producers out of business, expecting to raise the price once it has accomplished that objective, the manufacturer is engaged in

predatory dumping

A(n) _________ duty is a fixed sum of money charged for a specified physical unit of the product.

specific

Regardless of the value of the invoice, Kendall's company charges $0.14 per pound of butter exported. This tax is an example of a(n)__________duty

specific

A government that has achieved ________________ has the ability to maintain itself in power and hold to predictable fiscal and political policies.

stability

Businesses like peace and predictability because they provide ____________

stability

What are the three major groupings of nonquantitative nontariff barriers? (Check all that apply.)

standards direct government participation in trade customs and other administrative procedures

In the past, the U.S. government provided payments to farmers as a way to manage surplus food resulting from increased production needed to fuel WWII and to feed Europe. The government offset and controlled the overproduction of these crops so as to prevent them from flooding the market. These payments to farmers were an example of _______

subsidies

Productivity per worker is greater in more developed countries because of_____

superior management advanced technologies more capital per worker

Al Qaeda, the Irish Republican Army (IRA), Hamas, and Hezbollah are groups associated with

terrorism

Advocates for the protection of an infant industry claim that firms need protection from imports until they _________

train the labor force master production techniques obtain the required investment capital achieve economies of scale

A(n) ________ guarantees that the market price of the import will be the same as that of domestically produced goods.

variable levy

The rates for nuisance tariffs are

very low

An orderly marketing arrangement is a type of

voluntary export restraint

Which of the following is issued by the exporting country rather than imposed by the importing one?

voluntary export restraints