International Management Exam 1

A subset of European countries has adopted a unified currency called the euro. What are the effects of this action? -The European Union and Russia signed the Transatlantic Trade and Investment Partnership (T-TIP) -Customers are allowed to compare prices between most countries. -Business companies can reduce their costs by conducting business in one uniform legal tender. -Large multinational corporations (MNCs) can achieve the operational scale necessary to eliminate social services

-Customers are allowed to compare prices between most countries -Business companies can reduce their costs by conducting business in one uniform legal tender

Identify a statement that illustrates the treatment and rights of aliens. -A country must respect the laws, institutions, and governments of other countries in the matter of jurisdiction over their own citizens. -A country has jurisdiction over behavior that adversely affects its national security, even if that conduct occurred outside the country. -A country has the right to limit the travel of foreign artists coming into the country to attend an art exhibition and can insist they remain within ten miles of their hotel. -A foreign company that sells a defective product in the United States can be sued under U.S. law even though the firm is headquatered outside the United States.

A country has the right to limit the travel of foreign artists coming into the country to attend an art exhibition and can insist they remain with in ten miles of their hotel.

MATCHING Terms -A general balance between supply and demand -An imbalance between supply and demand Options -It results in a fluctuation in the process of goods or services -It sustains prices of goods and services

A general balance between supply and demand -It sustains prices of goods and services An imbalance between supply and demand -It results in a fluctuation in the process of goods or services

Identify the trends that pertain to global demographics. -According to the Wall Street Journal, the working-age population will contract by nearly 5 percent worldwide by 2050. -According to the Wall Street Journal, China will see a 20 percent increase in its working-class population by 2050. -The amount of spending on health care-related services will keep on increasing rapidly -Elderly population will spend income on housing and other capitally financed purchases.

According to the Wall Street Journal, the working-age population will contract by nearly 5 percent worldwide by 2050. The amount of spending on health care-related services will keep on increasing rapidly

In the context of e-business, _______ has exhibited the highest Internet penetration growth rate from 2000 to 2018, at more than 10,000 percent. -Asia -Australia -Europe -Africa

Africa

Comprehensive & Progressive Agreement for Trans-Pacific Partnership (CPTPP)

Agreement between Russia and Asia Result of the United States TPP which failed in terms of it being ratified in this country

Identify a statement that refers to the act of state doctrine. -There must be mutual respect for the laws, institutions, and governments of other countries in the matter of jurisdiction over their own citizens. -Every country has jurisdiction over its citizens no matter where they are located. -Every country has jurisdiction over behavior that adversely affects its national security. -All operations of other governments are considered to be valid by U.S. courts, even if such operations are inappropriate in the United States.

All operations of other governments are considered to be valid by U.S. courts, even if such operations are inappropriate in the United States.

Identify the reasons why Mexican firms are now able to produce products at highly competitive prices. -Because the Mexican market is close to the American market -Because of the decline of the maquiladora system -Because of the availability of low-cost labor -Because Mexico is a member of the Group of Seven (G7) economies

Because the Mexican market is close to the American market Because of the availability of low-cost labor

The economy of ______ outweighs that of any other South American country and has become a world wide presence with an economic output comparable to that of France. -Venezuela -Argentina -Chile -Brazil

Brazil

Identify the BRIC nations. -China -Russia -Canada -Brazil -Ireland -India

Brazil, Russia, India, China

MATCH THE ECONOMIES Countries Chile & Argentina Economies -It attracts a lot of foreign direct investment, mainly associated with gas, water, electricity, and mining, and it continues to participate in globalization by engaging in trade agreements. -It has one of the strongest economies overall, but it has suffered the recurring economic problems of inflation, external debt, capital flight, and budget deficits.

Chile - It attracts a lot of foreign direct investment, mainly associated with gas, water, electricity, and mining, and it continues to participate in globalization by engaging in trade agreements. Argentina - It has one of the strongest economies overall, but it has suffered the recurring economic problems of inflation, external debt, capital flight, and budget deficits.

MATCHING Term Chile & Argentina Choices -Its market-based economic growth has varied between 2 and 6 percent since the early 2000s and is one of the best and most stable performances in Latin America -In 2018, it experienced a financial crisis when its currency crashed, and its foreign debt became more expensive to repay.

Chile-Its market-based economic growth has varied between 2 and 6 percent since the early 2000s and is one of the best and most stable performances in Latin America Argentina-In 2018, it experienced a financial crisis when its currency crashed, and its foreign debt became more expensive to repay.

An extreme form of socialism that was realized through violent revolution is _____. -Corporatism -Nationalism -Individualism -Communism

Communism

Which of the following helped Russia to increase the gross domestic product (GDP) and decrease inflation, offsetting the hyperinflation created from the initial attempt at transitioning to a market-based economy in the early 1990s? Institution of the Maquiladora system -Direct investment in Russia -Russia's membership in the MIST group of economies -Russia's membership in the International Monetary Fund (IMF)

Direct investment in Russia Russia's membership in the International Monetary Fund (IMF)

What are the most commonly considered reasons for the political unrest associated with the 2011 Arab Spring in the authoritarian and/or totalitarian countries across northern African and the Middle East? -Economic Decline -Low unemployment -Increased rates of globalization -Oppressive government rule -Human right violations

Economic Decline Oppressive government rule Human right violations

Identify the countries that are part of the N-11 group of economies. -Egypt -Philippines -Pakistan -South Korea -Saudi Arabia -India

Egypt, Pakistan, Philippines, South Korea Indonesia, Iran, Mexico, Nigeria, Turkey, and Vietnam

Which of the following is an essential requirement of the political system of democracy? -The response to the opposition to government should be imprisonment. -There should be only one representative party the exhibits control over every facet of political and human life. -Every citizen should be allowed to participate in decision-making processes. -Power of political party should be maintained by suppression of opposition, which is allowed to be violent.

Every citizen should be allowed to participate in decision-making processes.

True or false: In recent years, Canadian companies have restricted their business to Canada.

False

Which of the following are true about businesses in a command economy? -Firms have the least restriction as the allocation of resources is roughly determined by the law of demand. -Firms are owned by the government to ensure that business practices are done in the beast interest of the nation. -Firms are provided with government subsidies so they cannot go out of business -firms give high importance to demographic information to create business opportunities

Firms are owned by the government to ensure that business practices are done in the beast interest of the nation. Firms are provided with government subsidies so they cannot go out of business

Which of the following are examples that show the multinational corporations (MNCs) have been making direct investments in the Hungarian market? -Chaebols that invest in internationally known firms as Samsung and Daewoo -Microsoft's acquisition of aQuantive Inc. -General Electric's purchase of Tungsram -Britain's Telfos Holdings that paid $19 million for the 51% of Ganz

General Electric's purchase of Tungsram Britain's Telfos Holdings that paid $19 million for 51% of Ganz

The process of social, political, economic, cultural, and technological integration among countries around the world is known as _________.

Globalization

Identify a statement that refers to the ideology of individualism. -The needs and goals of society are considered more important than individual desires. -Government interest should not solely influence one's behavior. -Individual rights need to be sacrificed, and property should be commonly owned. -Governments should own businesses because in a capitalist society only few would benefit.

Government interest should not solely influence one's behavior.

Identify the pro-business initiatives taken by Enrique Pena Nieto as the president of Mexico. -The Mexican oil industry was nationalized -Greater competition was forced in telecommunications -The Mexican auto industry was expanded -Mexico became part of the Group of Seven (G7) economies

Greater competition was forced in telecommunications The Mexican auto industry was expanded

Identify the pro-business initiatives taken by Enrique Pena Nieto as the president of Mexico. -Greater competition was forced in telecommunications. -Mexico became part of the Group of Seven (G7) economies. -The Mexican auto industry was expanded. -The Mexican oil industry was nationalized.

Greater competition was forced in telecommunications. The Mexican auto industry expanded.

Identify the beliefs held by Karl Marx that pertain to the ideology of socialism. -He sought to forge a type of national unity based on ethnic, religious, cultural, or racial attributes. -He stated that governments should own businesses because in a capitalistic society only a few would benefits. -He recommended a classless society where everything was essentially communal. -He believed that classes should still exist and that the best suited should rule over the people.

He stated that governments should own businesses because in capitalistic society only a few would benefits. He recommended a classless society where everything was essentially communal.

Global Value chain

Human resources and intellectual properties that add value to the product or service being put out

In contrast to its fellow BRIC partners, _____ continues to post strong figures and has surpassed China in annual gross domestic product (GDP) growth rate in recent years. -Ireland -Russia -India -Romania

India

In March 2006, PricewaterhouseCoopers (PwC) used the term E7 to refer to seven major emerging economies. Which of the following are part of the E7? -Turkey -Indonesia -Jordan -India -Mexico -Norway

India, Mexico, Turkey, Indonesia Brazil, China, Russia

Which of the following were the beliefs of the Greek philosopher Plato that pertain to the ideology of collectivism? -Individual rights need to be sacrificed -A classless society should be instituted. -Property should be commonly owned. -Individual needs are more important than societal goals.

Individual right need to be sacrificed Property should be commonly owned

The process of applying management concepts and techniques in a multinational environment and adapting management practices to different economic, political, and cultural contexts is termed _______ ________.

International Management

MATCHING Terms Internationalization & Globalization Choices -The process that primarily deals with the vision of building one world unit, a single market entity -The process that primarily includes a business crossing national and cultural borders

Internationalization - The process that primarily includes a business crossing national and cultural borders Globalization - The process that primarily deal with the vision of building one world unit, a single market entity

MATCHING QUESTION Terms Islamic law Socialist law Common Law Civil or code law Descriptions -Law that comes from interpretation of the Qur'an and the teachings of the Prophet Muhammad -Law that comes from English Law -Law that is ferived from Roman Law -Law that comes from the Marxist socialist system and continues to influence regulations in countries formerly associated with the Soviet Union as well as China

Islamic Law - Law that comes from interpretation of the Qur'an and the teachings of the Prophet Muhammad Socialist Law - Law that comes from the Marxist socialist system and continues to influence regulations in countries formerly associated with the Soviet Union as well as China Common Law - Law that comes from English law Civil or code law - Law that is derived from Roman law

Identify an effect of the free-market-based economy of North America. -It allows for greater flexibility when compared with other forms of economic systems. -It institutes trade barriers for other countries to establish business. -It Lets the government explicitly control decision-making processes of private firms. -It restricts Asian countries from investing in the U.S. market.

It allows for greater flexibility when compared with other forms of economic systems.

Identify a true statement about "right-wing" totalitarianism. -It allows for political freedom, not economic freedom. -It mandates the provision that every citizen should be involved in the decision-making processes of a country. -It is directly against socialist and communist ideas. -It refers to the system in which the government is controlled by the citizens either directly or through elections.

It is directly against socialist and communist ideas.

Identify the true statements about global trends in technology, communication, and innovation. -There is a drastic reduction in the world's reliance on digital communication and imaging. -Many organizations are aggressively working to put low-costing computers into the hands of the hundreds of millions of children in the developing world. -The open-source model can be used by underdeveloped countries to gain a competitive advantage while minimizing costs. -Developed countries are adopting the open-source model to restrict free and legal sharing of software and code.

Many organizations are aggressively working to put low-costing computers into the hands of the hundreds of millions of children in the developing world. The open-source model can be used by underdeveloped countries to gain a competitive advantage while minimizing costs.

The __________ system refers to a factory, the majority of which are located in Mexican border towns, that imports materials and equipment on a duty- and tariff-free basis for assembly or manufacturing and re-export.

Maquiladora

Which of the following countries are part of the North American Free Trade Agreement (NAFTA) that has removed all barriers to trade among these countries and created a huge North American Market? -Mexico -The United States -Panama -Canada -The Dominican Republic

Mexico The United States Canada

Which of the following are the MIST countries, which are grouped as a subset of the N-11 group of economies? -Indonesia -India -South Korea -Turkey -Mexico -Morocco

Mexico, Indonesia, South Korea, Turkey

A combination of a market and a command economy is called a(n) _________ __________

Mixed Economy

The success of Britain's Conservative Party and Germany's Christian Democratic Party in the 1970s and 1980s was in response to the _______. -violent movement toward privatization -reduction in taxes and prices by the social democratic system based on public interest -adoption of the ideology of anticommunism -monopolistic structure of nationalized businesses that was established by the social democratic system

Monopolistic structure of nationalized businesses that was established by the social democratic system

Which of the following refers to the economy of Mexico? -Mexico has free-trade agreements only with United States and Canada -More than 90 percent of Mexico's trade takes place under free-trade agreements -Mexico is the United States' largest trading partner -Mexico is one of the Group of Seven (G7) economies

More than 90 percent of Mexico's trade takes place under free-trade agreements

An ideal in and of itself whereby a person is completely loyal to his or her country is termed ______. -agnosticism -individualism -nationalism -conservatism

Nationalism

MATCH THE DEFINITIONS Terms: Offshoring & Outsourcing Definitions: -The subcontracting out of activities to endogenous organizations that had previously been performed by a firm. -The process by which companies undertake some activities at foreign locations instead of in their countries of origin.

Offshoring - The process by which companies undertake some activities at foreign locations instead of in their countries of origin. Outsourcing - The subcontracting out of activities to endogenous organizations that had previously been performed by a firm.

The economy of __________ was the only economy in the European Union (EU) that continued developing during the global recession of 2008-2009. -Bulgaria -Hungary -Poland -Norway

Poland

Which of the following is true about Poland as an example of the changing international regulatory environment? -Poland extensively privatized its state-owned enterprises in the early 2000s. -Poland nationalized industries such as insurance and coal mining in the early 2000s. -Poland is transitioning from a free-market economy to a state-planned economy. -Poland's autocratic government creates many problems for international firms.

Poland extensively privatized its state-owned enterprises in the early 2000s.

Which of the following statements refer to the political system of totalitarianism? -The representative government ensures individual freedom since anyone who is eligible may have a voice in the choices made. -Power is usually maintained by suppressing opposition, which can be violent. -The dominant ideals are media censorship, political repression, and denial of rights and civil liberties. -Every citizen is required to be involved in decision-making process.

Power is usually maintained by suppressing opposition, which can be violent. The dominant ideals are media censorship, political repression, and denial of rights and civil liberties.

Brazil has attracted considerable foreign investment over the past 30 years. Foreign organizations are drawn to opportunities created by Brazil's _______. -status as a a fully developed country -gross domestic product (GDP) that has successfully surpassed the GDP of China -privatization of telecommunications, power, and other infrastructure sectors -membership in the Group of Seven (G7) economies

Privatization of telecommunications, power, and other infrastructure sectors

Global Supply Chain

Raw Materials going into manufacturing operations (physical items)

A market economy has the least restriction because _______. -Business practices are done in the best interest of the nation -the government has explicit control over the price and supply of a good or service -the particular goods and services offered are in response to the theoretical advancement of society -resource allocation is roughly decided by the law of demand

Resource allocation is roughly decided by the law of demand

Which of the following is true about a mixed economy? -Some sectors are privately owned and have the freedom and flexibility of the law of demand, while other sectors are subject to government planning -Private enterprise reserves the right to own property and monitor the production and distribution of goods, while the state simply supports competition -I contains the least restriction as resource allocation is roughly determined by the law of demand -I creates an environment where little motivation exists to improve customer service

Some sectors are privately owned and have the freedom and flexibility of the law of demand, while other sectors are subject to government planning

In 2010, the BRIC leaders of the founding members agreed to admit ________ to the group, making it the BRICS. -Singapore -South Africa -Sri Lanka -Saudi Arabia

South Africa

An international principle of law that holds that governments have the right to rule themselves as they see fit is called the principle of _______. -Nationality -Protection -Territoriality -Sovereignty

Sovereignty

What are the findings of Goldman Sachs' 2001 report on the economic growth project to occur in the BRIC nations? -The BRIC economies' share of world growth could increase from 20% in 2003 to more than 40% in 2025 -The BRIC economies will constitute only one of the top five most dominant economies by the year 2050. -Economies of the BRIC nations will exceed the collective economies of the Group of Seven (G7) nations by 2032 -BRIC's total weight in the world economy would diminish from approximately 20% in 2004 to less than 10% in 2025

The BRIC economies' share of world growth could increase from 20% in 2003 to more than 40% in 2025 Economies of the BRIC nations will exceed the collective economies of the Group of Seven (G7) nations by 2032

The Transatlantic Trade and Investment Partnership (T-TIP) is a suggested trade agreement between ________ and ________. -Norway and the Russian Federation -The Russian Federation and the European Union -Switzerland and the United States -The European Union and the United States

The European Union and the United States

Which of the following groups of economies suspended Russia in 2014 after a series of political differences between the economies and Russia? -The CEVITS -The MIST -The N-11 -The Group of Seven (G7) Economies

The Group of Seven (G7) Economies

MATCHING QUESTION Terms The Nationality Principle The Territoriality Principle The Protective Principle Descriptions -Every country has jurisdiction over behavior that adversely affects its national security, even if that conduct occurred outside the country. -Every country has the right of jurisdiction within its legal province. -Every country has jurisdiction over its citizens no matter where they are located

The Nationality Principle - Every country has jurisdiction over its citizens no matter where they are located. The Territoriality Principle - Every country has the right of jurisdiction within its legal province. The Protective Principle - Every country has jurisdiction over behavior that adversely affects its national security, even if that conduct occurred outside the country.

______ is the global association of countries that oversees rules and regulations for international trade and investment, including agriculture, intellectual property, services, competition, and subsidies. -The Would Trade Organization(WTO) -The International Workers' Association (IWA) -The Fair Trade Federation -The Commonwealth of Independent States

The World Trade Organization (WTO)

Which of the following directly refers to the term "biotechnology"? -The integration of informatics and cytotechnology -The technology that lets satellites play a role in learning -The integration of science and technology -The technology that replaces artificial intelligence

The integration of science and technology

Which of the following is most likely a reason why a technological "leapfrogging" is happening in many developing countries? -Reduced costs of the production of fossil fuels -Reduced spread of e-commerce in developing countries -The quick and comparatively inexpensive installation of cellular infrastructure -The shift from using smartphones to landline phones in areas like sub-Saharan Africa

The quick and comparatively inexpensive installation of cellular infrastructure

Which of the following helps promote trade between the United States and Canada? -The similarity between the legal and business environments in Canada and the United States -The trade barriers established by the United States in the market of BRIC nations -The explicit government control of decision-making processes of private firms in Canada and the United States -The command economy of both the United States and Canada

The similarity between the legal and business environments in Canada and the United States

Which of the following refers to the nationalization of businesses? -The transference of a firm's ownership from individuals or groups of individuals to the government -An individual or groups of individuals buying a firm -The acquisition of a nationalized firm by another nationalized firm to increase profit gains -A multinational corporation starting a new factory in a country

The transference of a firm's ownership from individuals or groups of individuals to the government

Identify a change in global demographics by 2050. -The working-class population in China will increase by 20% -The working-age population will increase by 5% worldwide -The working-class population in Japan will double compared to nonworkers. -The working-age population in Germany and Italy will shrink over 20%

The working-age population in Germany and Italy will shrink over 20%

Which of the following refers to the doctrine of comity? -Governments have the right to rule themselves as they see fit. -Every nation has jurisdiction over behavior that adversely affects its national security, even if that conduct occurred outside the country. -Every country has jurisdiction over its citizens no matter where they are located. -There must be mutual respect for the laws, institutions, and governments of other countries in the matter of jurisdiction over their citizens.

There must be mutual respect for the laws, institutions, and governments of other countries in the matter of jurisdiction over their citizens.

What is the ultimate objective of the European Union (EU)? -To become the United States' largest trading partner -To facilitate the functioning of the maquiladora system -To become a member of the BRICS group economies -To remove all trade barriers among member countries

To remove all trade barriers among member countries

What are the integral components of fascism? -Individualism -Totalitarianism -Authoritarianism -Communism -Nationalism -Corporatism

Totalitarianism Authoritarianism Nationalism Corporatism Militarism, collectivism, anticommunism, and opposition to economic and political liberalism.

True or False: Managers from today's multinational corporations (MNCs) are required to learn to work effectively with those from many different countries.

True

True or false: The European community believes that forcing Greece to accept severe austerity measures is necessary to assure financial stability and repayment of bailout funds.

Ture

Identify true statements about the Hungarian economy. -Hungary is part of the Group of Seven (G7) economies -The Hungarian economy was the only economy in the European Union (EU) to continue to grow during the global re-cession of 2008-2009 -Western firms have been entering into joint ventures with local firms in Hungary -State-owned hotels in Hungary have been privatized

Western firms have been entering into joint ventures with local firms in Hungary State-owned hotels in Hungary have been privatized

Greece has been forced to accept certain measures as it has accepted multiples bailout packages from the International Monetary Fund (IMF), the European Commission, and the European Central Bank between 2010 and 2015. What are those measures?

cuts to public spending freezing of government pensions and wages

History proves the inefficiency and economic stagnation of the command economic system with the dramatic _______. -development of socialism in the 1970s -decline of capitalism in the 1980s -decline of communism in the 1980s -development of Marxism in the 1970s

decline of communism in the 1980s

According to PricewaterhouseCoopers (PwC), the gross domestic product (GDP) of the E7 would _______. -exceed that of the Group of Seven (G7) economies by around 2030 -be equal to that of the Group of Seven (G7) economies by 2060 -expand at an annual rate of 1.2 percent through 2050 -shrink at an annual rate of 3.8 percent through 2050

exceed that of the Group of Seven (G7) economies by around 2030

Reshoring

moves foreign production and jobs back to domestic locations

According to the international trade rules set by the World Trade Organization (WTO) and other trade and investment agreements, countries should _____. -refrain from discriminating against other countries in their trade relations -refrain from providing national treatment to other countries -mandate that multinational treatment to other countries -mandate that multinational corporations (MNCs) employ a certain percentage of local workers -mandate that multinational corporations (MNCs) take on local partners in order to do business

refrain from discriminating against other countries in their trade relations

A feature of a command economy is that _____. -the government has direct control over the price and supply of a good or service -the state simply supports competition and efficient practices of private firms -private enterprises reserve the right to monitor the production and supply of goods and services -this model contains the least restriction as the allocation of resources is roughly determined by the law of demand

the government has direct control over the price and supply of a good or service

Nearshoring

the transfer of an offshored activity from a distant to a nearby country

What were the objectives of the Foreign Corrupt Practices Act (FCPA) of 1977? -To upgrade the business environment for foreign competitor firms -to improve the image of both the United States and its businesses abroad -the prohibit U.S. multinational corporations (MNCs) from initiating or perpetuating corruption in governments of other countries -To grant the right for U.S. courts to dismiss any case brought before them by foreigners without examining issues

to improve the image of both the United States and its businesses abroad the prohibit U.S. multinational corporations (MNCs) from initiating or perpetuating corruption in governments of other countries