IBA 350 Study Guide Exam 1

​________ refers to the steady integration and increasing interdependence of economies.

Globalization of markets

Which one of the following is an example of globalizing​ manufacturing?

An Indian apparel company sets up a factory in Madagascar.

​________ are corporations or individuals with expertise in​ finance, legal​ advice, customs​ clearance, or support services that help firms perform international business transactions.

Facilitator

Assets such as​ technology, capital, and managerial talent are known as​ ________.

Factors of production

Which one of the following best explains the globalization of​ production?

Firms reduce manufacturing costs and retail prices by moving manufacturing activities to nations with lower costs of labor.

Which term refers to the continuing economic assimilation and interdependency of countries across the​ globe?

Globalization of markets

Which one of the following motivations for international expansion involves expanding overseas in order to grow the customer base and increase the number of products being​ manufactured?

Developing economies of scale

A​ ________ is a professional company that offers logistics and marketing services for focal firms as part of worldwide supply chains.

Distribution channel intermediary is a specialist

For some​ jobs, traveling the world and meeting people from various cultures and backgrounds facilitates career growth. In such​ cases, studying international business is most likely​ ________.

creating a competitive advantage for an individual

​________ initiate international business activities by​ envisioning, crafting, and creating goods and services for global buyers.

Focal firms

Which one of these factors is driving global economic​ transformation?

Industrialization in fast-growth developing economies

​________ involves the allocation of assets to another country or the attainment of assets in that particular country.

International investment

Which of the following represents the trend of economic disaster spreading from one country to​ another?

Contagion

For the U.S.​ economy, international trade is a critical element that generates one of every seven dollars of U.S. sales. This fact supports the idea that studying international business​ ________.

Contributes to the health of the U.S economy

​Consumers' daily​ lives, partialities toward​ products, and spending habits all over the world are becoming increasingly similar. Popular brands now have global​ followings, and materials are becoming more standardized. This represents which dimension of​ globalization?

Convergence of customer preferences and standards

A company with​ ________ or fewer employees is defined as an SME.

500

Which of the following is a motivation for international​ expansion?

Being closer to supply sources

A newly established corporation that begins international business activity very early in its​ development, allowing it to move promptly into overseas​ markets, is called a​ ________.

Born global firm

​________ risk represents possible losses or failures as a result of poorly developed or implemented business​ strategies, tactics, or procedures.

Commercial

​________ represents possible losses or failures as a result of poorly implemented business​ strategies, maneuvers, or processes.

Commercial risk

​________ involves possible adverse effects on operations and profitability due to developments in the​ political, legal, and economic environments of a foreign country.

Country Risk

​Lifestyles, customs, and religion have a potential for causing which type of international business​ risk?

Cross-cultural

Which term refers to the risk of adverse fluctuations in exchange​ rates?

Currency risk

Which one of these describes a strategy that involves a​ firm's establishing a presence overseas by acquiring productive assets such as​ land, plants,​ equipment, capital, and​ technology?

Foreign direct investment

​________ involves a company paying external suppliers and​ contractors, who are located in foreign​ nations, to perform​ value-adding activities.

Global outsourcing

​________ inspires corporations to establish their​ sourcing, producing, and promoting activities on a worldwide scale in order to attain lower costs with higher efficiency.

Globalization

Which dimension of market globalization is a result of the North American Free Trade​ Agreement, as well as other​ countries' agreements that have facilitated reduced trade barriers among their​ members?

Growth of regional economic integration blocs

Based on her studies of international​ business, Yolanda Sanchez decides to buy paper for her office supply store from wood grown in sustainable forests in​ Canada, even though the sustainable paper costs more than other paper. Considering the reasons to study international​ business, which of the following best explains Yolanda​ decision?

Implementing corporate citizenship efforts.

Your roommate is uncertain about a college major. Knowing that she is passionate about social and environmental​ causes, you suggest that she major in international business. When she graduates and works for a large​ company, you assert that she will be able to influence the​ company's actions as they affect society and the environment. Which one of the following reasons for studying international business are you​ advocating?

International business supports sustainability and corporate citizenship.

​________ is inspiring quicker dispersion of consumer products and brands across the globe.

International trade

Which term refers to the trend of corporations to methodically expand their worldwide business activities?

Internationalization

​A(n) ________ is a large corporation with significant resources that executes countless business activities through a system of subsidiaries and affiliates located in various countries.

Multinational enterprise

A U.S. manufacturer of automatic car wash equipment has seen its U.S. sales decline. The manufacturer decides to expand into Mexico and Canada. This is an example of which one of the following motivations for international​ expansion?

Pursuing prospects for growth through market diversification

What should governments do to reduce the harm of globalization while also acquiring the benefits associated with​ globalization?

Regulate financial institutions appropriately

Which one of the following is an upstream​ value-chain activity?

Research and development

Which one of the following statements is most likely​ true?

Risks cannot be avoided, but they can be managed and anticipated.

Which phase of globalization is composed of the growth and supremacy of multinational enterprises in the industrial and agricultural​ industries?

Second phase

​Leon's Luxury​ Clothing, located in​ Manhattan, designs a line of high end summer apparel for professional men and women. The company is considering opening a location in Brazil. The most likely reason for this international expansion is to​ __________.

Seek opportunities for growth through market diversification

When a domestic firm seeks opportunities in foreign​ markets, the​ firm's motive is best described as​ ________.

Strategic

Which one of the following factors best explains why trade growth has outperformed GDP growth over the​ years?

The liberalization of markets

Which of the following is a motive for international​ expansion?

To stay close to supply sources

Which of the following is NOT a motive for firms to​ internationalize?

To supplement unemployment in the domestic market by fostering foreign talent.