IB Chapter 1 Final

Which of the following was created to regulate fixed exchange rates and enforce the rules of the International monetary system?

A) International Monetary Fund

________ involves the idea that a nation-state is autonomous, cannot intervene in the affairs of other nations, and can enter into binding international agreements.

A) National sovereignty

Which of the following statements is true of developing countries that have embraced globalization?

A) The countries have experienced an increase in life expectancy.

The ________ replaced the institution of GATT while retaining all of the former GATT agreements.

A) World Trade Organization

As a result of globalization, Argonia finds that its national borders are becoming less relevant. This indicates that Argonia is undergoing ________.

A) denationalization

Which of the following refers to the use of computer networks to purchase, sell, or exchange products; service customers; and collaborate with partners?

A) e-commerce

Opponents argue that globalization ________.

A) eliminates manufacturing jobs in developed nations

Which of the following terms applies to the sale of a particular brand of jeans manufactured in the U.S. and sold in Canadian stores?

A) exporting

The term ________ refers to entities cooperating across national boundaries.

A) internationalization

Some nations encourage ________ because of recent resistance to worldwide trade agreements.

A) regional pacts

Most companies today operate in an environment of increased transparency and scrutiny regarding their business activities. This is due to ________.

A) the rise of the social media

________ is an effective alternative to traditional distribution channels for firms that sell digitized products.

B) Electronic distribution

________ markets are characterized by the rural population migrating to cities for better pay and thus, overloading cities' infrastructures.

B) Emerging

________ are all goods and services sold abroad and sent out of a country.

B) Exports

________ is defined as the dispersal of production activities to locations that help a company achieve its cost-minimization or quality-maximization objectives for a good or service.

B) Globalization of production

Globalization tends to foster two important values, tolerance and ________.

B) diversity

Gentian Violet is a dye manufacturing company that uses computer networks to sell its products, service customers, and collaborate with partners. Which of the following technologies is the company engaging in this scenario?

B) e-business

To minimize the economic inequality within developing nations, studies suggest that the nations can boost incomes of their poorest citizens by ________.

B) embracing globalization and integrating themselves into the global economy

Konesia is a country in which rising incomes are increasing the global demand for basic products and services. Which of the following is the type of market featured in this country?

B) emerging market

A special region in which companies can engage in tariff-free importing and exporting is called a(n) ________.

B) export-processing zone

The KOF Index measures the ________.

B) extent of globalization

Which of the following refers to convergence in buyer preferences in markets around the world?

B) globalization of markets

According to the opponents of globalization, which of the following occurs as a result of worker dislocation brought about by globalization?

B) lower workers' wages in developed nations

Globalization is characterized by ________.

B) national boundaries becoming less relevant

Each ________ is composed of unique cultural, political, legal, and economic characteristics that define business activity within that nation's borders.

B) national business environment

The three main goals of the World Trade Organization (WTO) are to help the free flow of trade, help negotiate the further opening of markets, and ________.

B) settle trade disputes between its members

Which of the following actions can be adopted by developed nations to lessen the negative effects of globalization?

B) slash agricultural subsidies that hurt the exports of developing nations

The population of a(n) ________ market is mostly rural and is characterized by poor infrastructure with little credit or collateral.

B) traditional

Kireki is a small country with a corrupt government. Its population is rural for most part and citizens have few or no legal rights. Which of the following is the type of market featured in Kireki?

B) traditional market

Which of the following is an example of globalization of production?

C) A U.S. company that builds a computer hardware manufacturing facility in India

________ is the trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies.

C) Globalization

________ place limits on the quantity of a product being imported.

C) Nontariff barriers

Olive oil prepared in a small Italian oil press factory and sold by large supermarkets in the United States is an example of a ________.

C) U.S. import

The rise of a new international entity called the ________ suggests that any company, regardless of age, experience, and resources, can engage in international business.

C) born global firm

As former competitors in many industries link up to challenge others on a worldwide basis, ________ occurs.

C) consolidation

Crystal inc. is a multifaceted company that deals with the mining, cutting, and selling of diamonds. It gives distributors and suppliers access to its database to place orders or restock inventories electronically and automatically. Which of the following is the network implemented in the company?

C) extranet

The value of all goods and services produced by a country's domestic and international activities over a one-year period is the country's ________.

C) gross national product (GNP)

Supporters affirm that globalization ________.

C) increases wealth and efficiency in all countries

Any commercial transaction that crosses the borders of two or more nations is known as ________.

C) international business

The global business environment consists of four distinct elements: the forces of globalization, national business environments, the international business environment, and ________.

C) international firm management

Trade unions claim that by permitting international firms to continually move to nations with ________, globalization reduces labor's bargaining power and forces overall labor standards lower.

C) lower labor standards

A business that has direct investments (in the form of marketing or manufacturing subsidiaries) abroad in several countries is called a ________.

C) multinational corporation

Whereas relocating production to low-cost locales traditionally meant production of goods almost exclusively, it increasingly applies to the production of ________.

C) services

The ________ is an agency created to provide financing for national economic development efforts.

D) World Bank

Which of the following terms is used to refer to widespread job turnover throughout an economy?

D) churning

Critics of globalization say that global consumer-goods companies destroy ________.

D) cultural diversity

An established consumer market that primarily comprises the middle class and possesses efficient infrastructure is characteristic of ________ markets.

D) developed

A major flaw of the original General Agreement on Tariffs and Trade (GATT) was that it lacked the power to ________.

D) enforce world trade rules

Globalization is criticized because it ________.

D) exploits workers in low-wage nations

Goods and services purchased abroad and brought into a country are called ________.

D) imports

The purpose of the General Agreement on Tariffs and Trade (GATT) was to ________.

D) promote free trade

Development that meets the needs of the present without compromising the ability of future generations to meet their own needs indicates ________.

D) sustainability

Two major forces that underlie the expansion of globalization are falling barriers to trade and investment, and ________.

D) technological innovation

Small companies selling traditional products benefit from ________.

D) technology that lowers the costs and difficulties of global communication

A characteristic of the world's least-global nations is low levels of corruption.

False

Critics of globalization argue that it eliminates jobs in developing nations.

False

Critics of globalization believe the overall gains that accrue to national economies are worth the lost livelihoods of some workers.

False

Gross national product (GNP) is the value of all goods and services imported into a country over a one-year period.

False

NAFTA is the international organization that enforces the rules of international trade worldwide.

False

Products marketed in all countries essentially without any changes are known as continental products.

False

Research shows that pollution-intensive U.S. companies tend to invest in nations with lenient environmental standards.

False

Small businesses will be completely immune to events in the international business environment.

False

Supporters and critics of globalization appear to agree that globalization prevents dislocation in labor markets.

False

The power of the General Agreement on Tariffs and Trade (GATT) to settle trade disputes is what sets it apart from the World Trade Organization (WTO).

False

The rules of the international monetary system are enforced by the World Bank.

False

The term "globalization of production" refers to convergence in buyer preferences in markets around the world.

False

A born global firm is a company that engages in international business from or near its inception.

True

Export-processing zones are special areas in which companies engage in tariff-free importing and exporting.

True

Extranets give distributors and suppliers access to a company's database to place orders or restock inventories electronically.

True

Flexible labor markets allow workers to be redeployed rapidly to sectors of the economy where they are highly valued.

True

Imports are goods and services purchased abroad and brought into a country.

True

International business is any commercial transaction that crosses the borders of two or more nations.

True

International firms tend to support reasonable labor and environmental laws to expand future local markets for their businesses.

True

Multinational corporations (MNCs) have direct investments abroad in multiple countries.

True

Pro-globalization economists believe globalization increases wealth in both developed and developing nations.

True

Resistance to worldwide trade agreements has resulted in some nations placing greater emphasis on regional pacts.

True

The General Agreement on Tariffs and Trade (GATT) was designed to promote free trade by reducing both tariffs and nontariff barriers to international trade.

True

The World Trade Organization's dispute settlement system has the ability to penalize offending nations.

True

The role of the World Bank is to provide financing for national economic development efforts.

True