INTB Module 5 True/False

Businesses favor unstable governments because they present more profit opportunities. True False

False

Kidnap, ransom, and extortion are techniques often used by terrorists against which no insurance is available. True False

False

One example of nationalization of private companies is with the nationalization of French-owned firms in Europe after WWII. True False

False

Only in communist countries do governments own the factors of production. True False

False

Paying ransom makes sense because a life is saved and the payments can be traced. True False

False

Terrorists avoid kidnapping because the repercussions can be harmful to their movement. True False

False

The British prime minister David Cameron led the privatization movement. True False

False

The length of the investment in a foreign country has no impact on the risk assessment for that investment. What matters are the economic and political situations in the country. True False

False

The only reason firms are nationalized is to spread a socialist-communist ideology. True False

False

The practice of country risk assessment is an exercise in xenophobic and ethnocentric thinking. True False

False

Unlike the topography, the political climate of a country has relatively little influence on its exports. True False

False

Unpredictable government actions create many business opportunities. True False

False

When government-owned companies compete with private companies, the private companies have the advantage. True False

False

When people are kidnapped for ransom, the right response is to pay the ransom, get the hostages released, and then retaliate. True False

False

Country risks are often political in nature. True False

True

One historic function of government has been the protection of the economic activities within its borders. True False

True

Policy continuity and government stability are more important to a business than the type of political system. True False

True

To hedge the terrorism risk, there are insurance, antiterrorist schools, and even companies to handle negotiations. True False

True

When the U.S. military contracts out security details in war zones, it is engaged in privatization. True False

True