Global Business Ch 7 Quiz

foreign trade zone

​A(n)________ is a designated location within a country that receives imported goods for assembly and then​ re-exports finished products.

Protectionism

​________ pertains to national economic policies that restrict free trade and protect domestic industries from foreign competition.

customs union

The second level of regional integration is​ a(n) ________.

The Gulf Cooperation Council​ (GCC)

Which of the following coordinates​ economic, social, and cultural affairs among​ Bahrain, Kuwait,​ Oman, Qatar, Saudi​ Arabia, and the United Arab​ Emirates?

Loss of direct investment

Which of the following is a disadvantage of regional​ integration?

NAFTA allowed​ member-country firms to submit bids for government contracts in the three countries.

Which of the following statements about NAFTA is​ true?

Trade among the EU members takes place unobstructed.

Which of the following statements best describes the European Union​ (EU)?

Your sales would likely decrease because your goods are now more expensive than those of your local counterparts

You own a firm that engages in overseas business.​ Recently, the exchange rate became much higher for your​ country's currency. How would the new exchange rate most likely affect your​ sales?

nontariff trade barrier

A government policy or procedure that restricts trade through means other than tariffs is known as​ a(n) ________.

Many governments enforce strict tariffs and restrictions on imports.

Economists Debbie and Don are discussing the effect of government intervention on business. Debbie believes that businesses that operate internationally have a more difficult time succeeding than those that operate solely domestically because of government intervention abroad. Don disagrees and asserts that international businesses experience ease of trade more readily than exclusively domestic businesses. Which of the following is the strongest argument for​ Debbie's point of​ view?

The​ export-led development model enables countries to make goods and then sell them to the world.

How can​ export-led development models help countries improve their​ economies?

The government will support foreign business by enacting laws that decrease import quotas.

If you are a business looking for a foreign market in which to sell​ goods, what does economic freedom in a country mean to your​ business?

internationalization

Regional integration leads to increased​ ________ by firms inside their economic bloc.

all

TDC​ Industries, a U.S.​ firm, has established operations in​ Germany, so TDC Industries has free trade access to​ ________of the EU market.

National security

The United States blocks exports of nuclear and military technology to nations considered state sponsors of​ terrorism, such as Iran and Syria. This is an example of which defensive motive by the U.S.​ government?

Subsidies

The World Bank has published an index entitled Ease of Doing Business. Which of the following is most likely to make a country​ "easy" to do business​ in?

Import licenses allow companies to do business legally overseas by allowing them to import products

What effect do import licenses have on businesses​ overseas?

Tariffs can hurt poor countries like​ Bangladesh, where clothing exporters are concentrated.

What ethical concerns do government intervention and trade barriers raise for developing​ economies?

Governments institute trade barriers on foreign imports to let​ young, domestic firms gain market share.

Which of the following is an example of protectionism used to support local​ businesses?

According to the​ GATT, a trade concession to one country did not become a concession to all countries.

Which of the following statements about the General Agreement on Tariffs and Trade​ (GATT) is​ FALSE?

Creation dispute settlement methods in areas such as​ investment, unfair​ pricing, labor​ issues, and the environment

Which of the following was NOT a step taken by the European Union​ (EU) in becoming an economic​ union?

Firms can use FTZs to assemble foreign materials and components into finished​ products, which are​ re-exported.

Which statement about free trade zones​ (FTZs) is​ true?

Investment incentives

Which type of government intervention encourages foreign companies to enter a​ host-country market?

It is easier to reach an agreement on free trade with a few nations than with numerous countries.

Why would a nation choose to be a member of an economic​ bloc?

You can manufacture your goods in the destination country and take advantage of​ low-cost labor.

You own a company in Texas and have an offer to open up a manufacturing plant as a maquiladora within the territory of one of your largest​ customers, Mexico. Why is this scenario beneficial to your​ business's profit?