International Business Connect Chapter 1

Some U.S. hospitals outsource radiology work to India. This is a recent advancement that is possible because of advancements in _____.

technology

While it is known for its peacekeeping role, the United Nations devotes nearly 70% of its work toward promoting conditions of

A vibrant global economy

Which country has been the world's largest exporter since 2009?

China

What is a challenge faced by companies entering the global market?

Differences in consumer tastes and preferences

Which statement accurately describes the globalization of markets?

National differences in tastes and preferences for consumer products is an important factor that acts as a brake on globalization.

Boeing outsources a large portion of its production. For example, for its most recent jet airliner (the 787), nearly ______ of the total value of the aircraft is outsourced to foreign companies.

65%

The globalization of _____ refers to the fact that producers can source goods and services from anywhere in the world to take advantage of cost savings.

production

What global institution was established on October 24, 1945 and one of its key purposes is to maintain international peace and security?

United Nations

The trade agreement called the _____, finalized in December 1993, established the World Trade Organization to police the international trading system.

Uruguay Round

The G20 is comprised of ______ from the 19 largest economies in the world.

finance ministers

In return for offering loans, the International Monetary Fund (IMF)

enforces its economic policies on nations.

International trade occurs when a company

exports goods or services to consumers in another country.

When a company invests in a company or entity outside its home country, it is participating in

foreign direct investment

The G20 was originally established to

formulate a coordinated policy response to financial crises in developing countries

Company ABC, based in Tennessee, sources goods from Southeast Asia to take advantage of labor cost savings. This is an example of _____.

the globalization of production

True or False: The International Monetary Fund (IMF) is considered less controversial than the World Bank.

False Reason: Both the IMF and the World Bank were established at Bretton Woods. The World Bank is the less controversial of the two institutions.

True or False: While there are a large number of nations that are members of the WTO, these nations account for only a small portion of world trade.

False; Reason: As of 2019, there were 164 nations that were members of WTO and they accounted for 98% of world trade.

Mallory's US-based lifestyle company decides to invest in an Italian company that specializes in health and wellness. This would be an example of

Foreign direct investment

What statement accurately describes the current membership of the United Nations?

Today, nearly every nation in the world belongs to the United Nations.

One of the global institutions that emerged over the past 75 years is GATT which stands for the General Agreement on Tariffs and _____.

Trade

What are two impediments to globalization that a company might face?

political risk transportation costs

During the early years of globalization, outsourcing was primarily confined to _____ activities.

Manufacturing

The text notes that there are two macro factors fueling the trend toward greater globalization. These two factors focus on a decline in trade barriers and

Technological change

What is an accurate description of the International Monetary Fund (IMF)?

The IMF is often seen as the lender of last resort to nation-states whose economies are in turmoil.

What is the best way to characterize the impact of existing impediments to globalization?

The impediments make it difficult for companies to maximize production activities.

Due to globalization, firms follow each other around the world, thereby

creating some uniformity across markets.

______ refers to the shift toward economic international integration.

Globalization

In the years leading up to the Great Depression, what practice created a barrier to international trade?

High tariffs on imports of foreign goods

Boeing's rationale for outsourcing so much production to foreign suppliers is based on which two factors, according to the text?

Increasing the chance to win significant orders from airlines in those countries Using suppliers that are the best in the world at a particular activity

What are three examples of factors of production?

Labor, Land, and Capital

What is an accurate depiction of the World Bank?

It focuses on helping developing countries fight poverty through investments in the underlying structure of the country.

Which organization would help out a cash-strapped government with a low-interest loan to help that country build new roads?

World Bank

Which global institution is the successor to GATT?

World Trade Organization

Which organization is responsible for policing the rules of trade between nations and making sure countries adhere to the rules of trade treaties signed by member states?

World Trade Organization

The International Monetary Fund (IMF) has been criticized for

compromising the jurisdiction and decision-making powers of the receiving country.

What are the two macro factors that underlie the trend toward greater globalization?

decline in trade barriers technological change

What are the four purposes of the United Nations according to its charter?

develop friendly relations among nations maintain international peace and security be a center for harmonizing the actions of nations cooperate in solving international problems

What is an example of an obstacle to globalization?

differences in legal regulations among national markets

In the 1960s, when a customer in the United States purchased a television, that television had been manufactured in the United States. Today, thanks to the fall of international trade barriers, televisions purchased in the United States might be manufactured in China or South Korea. This change has occurred as the result of _____.

globalization

The national differences in the quality of factors of production help companies

improve the quality or functionality of their product offering.

A company is involved in foreign direct investment when it

invests in business activities outside of its home country.

When describing the value of FDI over the last 30 years, it can be said that

it has grown significantly.