Chapter Six

Which of the following is NOT true about family planning in China?

Beginning in 1850, the communist government of China formally adopted a "one child" family planning policy.

A country's potential nationalization of companies in the oil industry would represent a macropolitical risk.

false

China, with its strong individualistic, entrepreneurial, free-market spirit, historically has been viewed as the leading economically capitalistic economy in the world.

false

The words "aspirin," "escalator," and "zipper" are examples of _____.

generalized trademarks

A political risk that only affects a certain industry or set of firms in a given country is called a _____ risk

micropolitical

The risks that government insability or problems in a given country will have a meaningful negative impact upon the conduct of business in that country make up the______ risks

political

A political risk that essentially affects all businesses in a given country is referred to as a ________ risk

macropolitical

The potential overthrow of a democratically elected presidential regime by a military junta is likely a _____ risk.

macropolitical

A legal system based on a religious document and religious teachings is referred to as a _______ legal system.

theocratic law

is a distinctive phrase, name, word, picture, symbol or design, or combination of these, that identifies a given business' service or product, and is owned by said business.

trademark

Currency devaluation and conversion restrictions are two of the many economic risks companies take when engaging in international business.

true

Patent rights generally remain enforcable for 5-20 years, depending on the invention and the country.

true

Rankings of countries throughout the world by potential political risks typically place Scandinavian and European countries such as Norway, Sweden, Switzerland, Luxembourg and Denmark near the top of the list, meaning that companies engaging in business in these countries face the least number of potential political risks.

true

_____ corruption is business corruption involving other private businesses, individuals, or groups.

Private

A 2010 survey asked individuals whether they or someone in their household had paid a bribe in the past 12 months. The survey found a _____ percent bribery rate in the United States.

5

laws are enacted to promote "fair competition" among businesses.

Antitrust

_____ refers to an economic system where businesses are privately owned with a strong individualistic profit orientation

Capitalism

or "buyer beware"; involves placing the burden of determining product safety on consumers.

Caveat emptor

or "Seller beware"; involves placing on manufacturers or sellers of products the burden of making sure products are safe or at least clearly and explicitly warning consumers about the potential safety risks of said product.

Caveat venditor

legal system is based on a comprehensive listing of legal rules in sets of written codes of law.

Civil law

legal system is where legislative bodies generally enact less specific legal rules giving judges or courts considerable authority in interpreting these rules based on precedent and other factors

Common law

law is the body of law governing legally enforceable agreements between parties to engage in economic exchange.

Contract

is defined as a situation where businesses are able to illegally alter relevant private and/or public decision making by way of bribes, kickbacks, blackmail, extortion and related activities.

Corruption

_____ establishes which violations of a nation's laws are crimes punishable by possible incarceration.

Criminal

_____ is Greek for "rule by the people"; it is a form of government in which all citizens have the right to vote.

Democracy

Singapore historically has had a highly anti-business political system in a parliamentary model context, with one ruling party, in power since 1959.

False

Of the following statements, which is NOT true about totalitarian governments?

Finland, South Korea, and Norway are run by a military dictatorship.

is a United States law that prohibits U.S. companies from bribing or otherwise corrupting foreign government officials in order to win foreign government contracts or obtain other foreign government assistance for their businesses

Foreign Corrupt Practices Act (FCPA)

is property that is the creative product of an individual's intellectual, rather than physical, activity.

Intellectual property

is a U.S. government agency that sells political risk insurance to U.S. businesses operating in countries with which the U.S. has a bilateral investment treaty.

Overseas Private Investment Corporation (OPIC)

_____ risks are the risks that political forces or problems in a given country will have a meaningful negative impact upon the conduct of business in that country.

Political

_____ involves an economic ideology in which the government or state plays a strong role in the economy and may own stakes in certain businesses.

Socialism

_____ involves unlawful arts or violence threatening the physical safety of others.

Terrorism

is defined as unlawful acts or violence threatening the physical safety of others.

Terrorism

Which of the following laws provides for (after a certain deductible) U.S. government insurance coverage for the risk of a U.S. business or property being attacked by a "foreign person or foreign interest?"

Terrorism Risk Insurance Act

is a United States law that after a certain deductible provides U.S. businesses government insurance coverage for the risk of terrorism.

Terrorism Risk Insurance Act of 2002

Of the following statements about common law legal systems, which is NOT true?

They originated in Asia in 1250.

_____ government is a system of government in which individuals govern without the support or consent of the citizenry.

Totalitarianism

Laws to promote "fair competition" among businesses are known as _____ laws.

antitrust

An alternative dispute resolution process whereby the parties designate a neutral private person or group of persons to hear and decide the case is referred to as

arbitration

An economic ideology where businesses are privately owned, strong individual incentives exist, and the government plays very little role in the economy is known as

capitalism

A legal system based on a comprehensive listing of legal rules in sets of written codes of law is known as a _____ law legal system.

civil

The practice of companies acting in a manner which secretly thwarts competition amongst themselves is known as

collusion

A legal system where legislative bodies generally enact specific legal rules giving judges or courts considerable authority in interpreting these rules based on precedent and other factors is called a _____ law legal system.

common

A country that has particularly militant labor unions known for frequent unplanned or wildcat strikes, or perhaps a country known for holding corporate executives hostage until their demands are met, are examples of _____ risk.

economic

A supplier paying a bribe to an officer of a company that purchases its products to help "facilitate" the purchase of said products is an example of _____ corruption.

private

The practice of making illegal payments to government officials or engaging in blackmail, extortion or other related activities in order to obtain government contracts or governmental approval for business activities is known as

public corruption

Most, if not all, democracies today are what are known as _____ democracies.

representative

The openness of democratic countries like Finland, and the protections such countries tend to generally provide for property rights and freedom of expression, usually make those countries more hospitable places to conduct global business than countries with totalitarian or semi-totalitarian political regimes.

true

Very little role for government exists in a purely capitalistic or "free market" economic system.

true