Chapter 8
_____ is a set of guidelines for making ethical decisions.
A code of conduct
The benefits of Association of Southeast Asian Nations (ASEAN) free trade area (AFTA) are limited because:
ASEAN's main trading partners are outside the region
Which of the following customs unions in South America is more pro-free trade?
Andean Community
Which of the following is a feature of low-context cultures?
Communication does not rely much on unspoken conditions or assumptions.
Which of the following is a disadvantage of global economic integration?
Critics may not be happy with the environmental impact.
Which of the following languages is lingua franca?
English
Which of the following options is a factor for the dominance of English as a global business language?
English-speaking countries contribute the largest share of global output.
In the global fight against corruption, the _____ was enacted by the US Congress in 1977. It bans bribery of overseas officials.
Foreign Corrupt Practices Act
Which of the following is the second set of clusters?
GLOBE clusters
Which of the following set of clusters divide the world into eight civilizations?
Huntington civilizations
Which of the following options is an example of a high-context culture?
In Japan, negotiators preferring not to flatly say "no" to a business request
_____ is the idea that the identity of a person is fundamentally his or her own.
Individualism
Which of the following is an economic benefit of global economic integration?
It allows for disputes to be handled constructively.
Which of the following statements is true of corruption?
It causes misallocation of resources.
Which of the following statements is true of culture?
It has two components: language and religion.
Which of the following statements is true of ethics?
It is deeply reflected in formal laws and regulations.
Which of the following statements is true of context?
It is the background against which interaction takes place.
Which of the following will result from global economic integration?
Its fundamental goal is to promote peace among countries.
Which of the following statements is true of religion?
Its knowledge is crucial for non-religious managers.
Which of the following options is an example of a low-context culture?
Lawyers in the United States making a contract as straightforward as possible
The _____, signed in 2007 and enacted in 2009, amended the Maastricht Treaty that served as a constitutional basis for the European Union (EU).
Lisbon Treaty
The Forman Free Trade Agreement (FFTA) is an economic union established to promote regional economic integration among its five member countries. In this case, which of the following is likely to be true?
Members of the FFTA coordinate and harmonize monetary, fiscal, and taxation policies.
_____ is the extent to which less influential members within a country expect and accept that power is distributed unequally.
Power distance
Which of the following was a result of the Australia-New Zealand Closer Economic Relations Trade Agreement (ANZCERTA or CER)?
Tariffs and nontariff barriers between the countries were removed.
Which of the following is a difference between the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO)?
The GATT does not cover Intellectual Property (IP) protection, whereas the WTO includes IP protection.
Which of the following agreements was signed among Canada, Mexico, and the United States?
The North American Free Trade Agreement (NAFTA)
Which of the following was agreed upon and launched at the end of the Uruguay Round in 1994?
The World Trade Organization (WTO)
Which of the following was the General Agreement on Tariffs and Trade's (GATT's) successor?
The World Trade Organization (WTO)
_____ was established in 1995 as the global multilateral trading system and the organization that supports it.
The World Trade Organization (WTO)
In comparison with the General Agreement on Tariffs and Trade (GATT), which of the following statements is true of the World Trade Organization (WTO)?
The World Trade Organization (WTO) includes effective trade dispute settlement mechanism.
The South East Trading Zone (SETZ) is a monetary union comprising eleven member countries. In this case, which of the following statements is true?
The member countries will integrate political and economic affairs of a region.
Praziland is one of the five countries in a free trade area (FTA). In this case, which of the following is likely to be true of the FTA?
The members of the FTA will remove trade barriers among themselves.
Which of the following statements is true of informal institutions?
They come from socially transmitted information.
Which of the following improvements resulted after the establishment of the General Agreement on Tariffs and Trade (GATT)?
Trade growth consistently outpaced the gross domestic product (GDP) growth.
Which of the following is a disadvantage of the General Agreement on Tariffs and Trade's (GATT's) policies?
Trade in services and intellectual property (IP) protection was not covered.
_____ has been developing because Asia-Pacific Economic Cooperation (APEC) is too big and too difficult to get anything meaningful done.
Trans-Pacific Partnership (TPP)
In the context of the World Trade Organization's (WTO's) trade dispute settlement mechanisms, the losing country:
can defy the WTO ruling by doing nothing and suffer trade retaliation by the winning country.
The North West Trading Zone (NWTZ) is a free trade area comprising eleven countries in the Moresian continent. The member countries of this free trade area use different currencies. In addition to imposing common external policies, the NWTZ permits the free movement of goods and people. In this case, the NWTZ is a _____.
common market
The North Symorian Trade Confederate (NSTC) was established to promote regional economic integration within six countries belonging to the same subcontinent. This free trade area has imposed common external policies on nonparticipants. In this case, NSTC is a _____.
customs union
Ethics helps to combat corruption, while corruption:
discourages foreign direct investment.
An American firm operating in the Middle East has a tough time enforcing rules against sexual discrimination of Muslim women working in the company. This is an example of _____.
ethical imperialism
The region consisting of eighteen European countries using a common currency is called the _____.
euro zone
A defensive strategy is passive. Firms do not feel compelled to act when problems arise, and denial is usually the first line of defense.
false
An accommodative strategy is a strategy that anticipates ethical challenges and addresses them before they happen.
false
Andean Community is relatively more protectionist and suspicious of the United States, whereas Mercosur is more pro free trade.
false
Given the slowdown of multilateralism and the acceleration of regionalism, managers should focus their attention more at global levels than regional levels.
false
Managers in low uncertainty avoidance countries tend to rely on rules.
false
The European Union (EU) is now a political union.
false
Lumberne is a continent comprising 18 countries. Currently, Lumberne is a free trade area and an economic union including all 18 countries as members of free trade. Although each country is politically independent, governments of at least 12 countries are negotiating to form a common government. If Lumberne comes to be led by a single government, it would be a _____.
political union
A(n) _____ maintains that some firms may be self-motivated to do it right regardless of social pressure.
positive view
Esca Motors is aware that the brake wires used in its cars are of poor quality. Yet, it refuses to take any action and proceeds to produce and sell the cars. The family of a victim who lost his life due to a brake failure in the middle of a highway sues the company. Esca Motors is pressurized by Congress to recall its cars and compensate the victims with money. Esca Motors gives in to the pressure and does what is necessary. This is an example of _____.
reactive strategy
The dimension approach is more influential than the context approach because the context approach _____.
represents only one dimension
A defensive strategy focuses on regulatory compliance.
true
Global economic integration refers to efforts to reduce trade and investment barriers around the globe.
true
In 2008, Andean Community and Mercusur countries agreed to form the Union of South American Nations (USAN).
true
Martha is an expatriate manager at Dabinelle Corp. in New Zealand. For the success of her firm, she should develop her cultural intelligence.
true