Chapter 5&6 BAPA 5131

Which of the following is an element of the comparative advantage principle?

relative efficiency of production

The US Securities and Exchange Act encourages confidence in business transactions by ___

requiring public companies to frequently disclose their financial indicators to investors

A(n) _____ is a type of trade penalty imposed on one or more countries by one or more other countries

sanction

Which of the following is an example of location-specific advantage?

skilled labor

The Organization of Economic Co-operation and Development OECD is classified as a(n) ____

special interest group

In his International Life Cycle IPLC Theory, Raymond Vernon observed that each product and its manufacturing technologies go through three stages of evolution: introduction, maturity and _____-

standardization

In the ____ phase of international product life cycle theory, knowledge about how to produce the product is widespread and manufacturing becomes straightforward.

standardization

Which of the following is characteristic of an effective legal system?

systematically enforced laws and regulations

Which of the following was the analysis revealed by the "Leontief paradox"?

that the US often exported labor-intensive goods and imported more capital-intensive goods

Which of the following is an example of an industrial cluster

the consumer electronics industry in Japan

Which of the following statements supports Country B over Country A

the flexibility of common law allows for judicial interpretation in unique cases

Which of the following is an example of an ownership-specific advantage?

the physical assets owned by a farm

Which of the following is true about the first stage of evolution in the international product life cycle theory?

the product enjoys a temporary monopoly at this stage

Religion-based totalitarian states are called ______

theocratic

The three major types of current political systems are _____

totalitarianism, socialism, and democracy

Both common law and civil law systems originated in ____

western Europe

Born global firms are ____

young companies that internationalize early in their evolution

Which of the following would be the best way for a manager to learn about country risks in a host country?

employees working in the host country

Which of the following is a comparative advantage?

entrepreneurial orientation

Which of the following refers to a collaborative venture which results in a new legal entity?

equity-based joint ventures

According to the internationalization process model, a firm advances to the ____ stage by initiating limited international activity, typically in the form of basic exporting

experimental involvement

Nations running a trade surplus ___

export more goods than they import

Which of the following terms refer to the application of home-country laws to persons or conduct outside national borders?

extraterritoriality

The _______ rests on the premise that countries differ in the type and quantity of production factors they possess.

factor proportions theory

Which of the following explains the expansion of born global firms despite the scarcity of financial, human, and tangible resources?

globalization has made doing international business easier than ever before

Which of the following is an element of socialism often found in democratic societies?

government intervention in the affairs of individuals and firms

Which of the following comparative advantages is acquired over time?

innovative capacity

____ is an explanation of the process by which firms acquire and retain one or more value-chain activities inside the firm, minimizing the disadvantages of dealing with external partners and allowing for greater control over foreign operations.

internalization theory

The World Bank is classified as a(n) _____

international organization

Income repatriation laws affect MNEs that earn profit in foreign countries by _____

limiting the amount of net income or dividends that can be transferred to the home-country headquarters

Which of the following would most likely oppose the opening of a Super Sports store in Norway?

local sports retailers

The eclectic paradigm specifies three conditions that determine whether a company will internationalize via FDI. Which of the following refer(s) to one of those conditions?

location-specific advantages

Boycotts and protests have the potential to harm businesses by _____

lost sales and increased costs for public relations activities

Which of the following law is responsible for the ban on cigarette advertisements in France?

marketing and distribution laws

A _____ is one or more resources or capabilities a company posses that few other firms have

monopolistic advantage

Which of the following explains how firms can use FDI to gain and sustain competitive advantage?

monopolistic advantage theory

According to Michael Porter, a nation's factor endowments help determine its ______

national competitive advantage

The _____ is one of the three key modern perspectives that helps explain the development of national competitive advantage.

national industrial policy

Maxdime Inc. is an international automobile manufacturer that has decided to work on low-cost fuel efficient motorbikes. Foray Inc., a domestic automobile company based in China, is willing to partner temporarily with the R&D team of Maxdime to design and launch motorbikes specially for the Chinese market. This is an example of ____ .

non=equity based strategic alliance

Which of the following best explains why India was once characterized by high country risk?

political leaders enacted laws that targeted foreign firms for harassment

Azure Inc. has established a domestic market in clothing and apparel in Thailand and has received orders from abroad. Currently, the firm is investigating the feasibility undertaking international business. Azure is in the _____ state of the internationalization process.

pre-export

Earth-Rite executives are considering internalizing operations in Brazil. Which of the following, if true, best supports this plan?

By internalizing operations, Earth-Rite will retain control of product quality

Islamic law is based on the ____

Qur'an

Which has been the impact of social democracy on international business relations in some European countries?

Regulations have forced foreign firms to invest elsewhere

Which of the following legal systems is largely practice in the Middle East?

Religious

Which of the following statements would be supported by Michael Porter?

Rivalry among industry competitors spurs innovation

Representative B is most likely from ____

Russia

Representative B is most likely from ______ (socialist nation)

Russia

Which of the following statements is true about managing country risks?

Scanning allows a firm to assess the potential country risk

____ fundamental tenet is that capital and wealth should be vested in the state and used primarily as a means of production rather than for profit.

Socialism's

An individual from a country with a low degree of political risk would most likely be from ________.

Canada

Representative C is most likely from ____ (democratic society)

Canada

________ refers to the superior features of a country that provide unique benefits in global competition, typically derived from either natural endowments or deliberate national policies.

Comparative advantage

Competitive advantage refers to the _____

Distinctive assets or competencies of a firm that are difficult for competitors to imitate and are typically derived from specific knowledge, capabilities, skills, or superior strategies.

In which of the following stages of the internationalization process is a firm preoccupied with business in its home market?

Domestic focus

Which of the following benefits would Earth-Rite most likely accrue if it entered into a joint venture with the Brazilian grocery store chain?

Earth Rite would have access to the foreign partners' know-how

_____ is seizure of corporate assets with compensation

Expropriation

___ describes the total value of assets that MNEs own abroad via their investment activities

FDI stock

According to Porter, Kazmia can attain economic prosperity by systematically cultivating new and superior factor endowments through _____

proactive national industrial policy

An individual from a country with a high degree of political risk would most likely be from ________.

Iraq

Which of the following refers to an important monopolistic advantage for firms?

proprietary technology

Which of the following is a benefit of internalizing foreign-based value-chain activities?

The MNE oversees control of foreign operations and ensures product quality

Which of the following is true about the determinants of national competitive advantage?

The presence of demanding customers pressure firms to innovate faster and produce better products.

Which of the following is true about absolute advantage principle?

This approach allows the nation to consume more than it otherwise could, generally at lower cost

Which of the following would be the most important for Earth-Rite executives to determine when deciding whether to collaborate with the Brazillian grocery store?

Would a collaborative venture allow Earth-Rite to internationalize rapidly.

Which of the following countries would Representative A most likely be from? (totalitarian state)

Zimbabwe

Common law can best be described as a system ____

based on legal precedents set by the nation's courts

Current trends suggest that early internationalizing firms will _____

become even more common in international business

International entrepreneurship is a new field of scholarly inquiry that is a result of the ____ phenomenon

born global

Which of the following is the underlying principle of socialism?

collective welfare of people outweighs the welfare of the individual

In the _____ stage of the internationalization process, a firm targets numerous foreign markets via various entry modes, especially FDI

committed involvement

Which of the following legal systems is based on legal precedents and past practices set by the nation's courts through interpretation of statutes, legislation, and past rulings?

common

The Gulf nations benefit economically from rich petroleum reserves in the region. This is an example of ____

comparative advantage

The ____ states that it can be beneficial for two countries to trade without barriers as long as one is relatively more efficient at producing goods or services needed by the other.

comparative advantage principle

In recent years, business executives and scholars have used ___ to refer to the advantages possessed by nations and individual firms in international trade and investment

competitive advantage

Which of the following is true with regard to competitive advantage?

A competitive advantage is difficult for competitors to imitate

Which of the following is true with regard to new trade theory?

According to new trade theory, trade is beneficial even for countries that produce only a limited variety of products

A(n) ____ is an official ban on exports to or imports from a particular country, in order to isolate it and punish its government

embargo

Which of the following is the LEAST adversarial method of resolving a contractual dispute?

Concilation

____ is the seizure of corporate assets without compensation

Confiscation

____ are the people and organizations that support the political system and receive government resources.

Constituents

Which of the following pairs of nations are on opposite ends of the political freedom scale?

Cuba and Sweden

Which of the following questions would be more important for Zane legal experts to consider before recommending Country A or Country B?

How would a contractual dispute with a local vendor be resolved.?

Which of the following countries is considered primarily socialist?

India

Which of the following is true about national industrial policy?

It is designed to create monetary and fiscal policies, such as low-interest loans, that provide a stable supply of capital for company investment needs

Which of the following supports a decision in favor of Super Sports opening a store in Norway?

MNEs may transfer profits back to the home country without restriction

_____ is the belief that national prosperity is the result of a positive balance of trade, achieved by maximizing exports and minimizing imports

Mercantilism

________ theory suggests that firms using FDI as an internationalization strategy must own or control certain resources and capabilities not easily available to competitors.

Monopolistic advantage

A proactive economic development plan initiated by the government, often in collaboration with the private sector, that aims to develop or support particular industries within the country is referred to as ________.

National Industrial policy

Which of the following is true about networks?

Networks are neither formal organizations with clearly defined hierarchical structures nor impersonal decentralized markets

________ argues that increasing returns to scale, especially economies of scale, are important for superior international performance in industries that succeed best as their production volume increases.

New trade Theory

Which of the following countries is considered a mixed economy

Norway

Which of the following supports Country A over Country B?

contractual noncompliance provisions are broader in scope

Which of the following terms indicates potential loss or adverse effects on company operations and profitability caused by developments in a country's political and/or legal environments

country risk

According to Porter's competitive advantage of nations, ________ refer to the nature of home-market demand for specific products and services.

demand conditions

Which form of government is characterized by private property rights and limited government?

democratic

Which of the following statements is most likely applicable to Country B?

detailed contracts that clearly state all potential contingencies

In the context of national industrial policy which of the following actions by the government of Kazmia would be the most beneficial for the long term economic security of the country?

devoting resources to improve national infrastructure