INTB Nov 4

Fair competition is a strong rationale for trade barriers. With fair competition, there will be increased efficiency for everyone.

F

Firms are nationalized when the goal of the government is to spread a socialist-communist ideology.

F

The national defense argument for trade restrictions is based on the country's level of development and foreign direct investment.

F

Unpredictable government actions create many business opportunities.

F

When people are kidnapped for ransom, all governments agree that the right response is to pay the ransom, get the hostages released, and then retaliate.

F

When the U.S. military contracts out security details in war zones, it is engaged in nationalization.

F

True or false: A compound duty is stated as a percentage of the invoice value of the product.

False

True or false: Import duties mean lower prices for the consumer.

False

True or false: In most parts of the world, you will not find government-owned businesses.

False

True or false: Sanctions are effective at achieving their goal of forcing change in the targeted country.

False

Which duty is stated as a percentage of the invoice value of the product?

ad valorem

Which industry do nearly all governments subsidize?

agriculture

The Smoot-Hawley Tariff Act demonstrates how tariffs can cause world trade to (increase/decrease).

decrease

Economists argue that the best way to protect national security and provide for national defense is through _________.

direct government subsidies

Supporters of fair competition suggest that an import ________ will bring the cost of imported goods up to the cost of domestically produced goods.

duty

Select all that apply What are three typical objectives of terrorism? (Check all that apply.)

exact revenge for real or imagined wrongs overthrow a government gain release of imprisoned colleagues

Voluntary export restraints are export quotas imposed by the _________ nation.

exporting

In _____ kidnapping, the victim is kidnapped, often near an airport or international hotel, and forced to withdraw money from cashpoints or an ATM before being released.

express

True or false: A compound duty is a combination of specific and nontariff barriers.

false

Quotas are usually (local/global) in nature, with the total amount fixed regardless of the source.

global

International firms can be protected from terrorism and cybercrime through (business/government) actions.

government

Official prices are determined by (government/businesses) to correct for deficiencies in ad valorem duties.

government

With the advent of WTO agreements, nontariff barriers have gained (greater/lesser) importance.

greater

Select all that apply Which of the following cybercrimes are most often targeted at businesses? (Check all that apply.)

hacking data espionage domain-related offenses

When comparing production levels at automotive plants in Mexico and the United States, productivity per worker is ________ in the United States than in Mexico.

higher

Tariffs are also called (import/export) duties.

import

Customs is a general term for duties paid on

imports

When governments impose trade restrictions, the cost of the traded goods will _________.

increase

A tariff-rate _________ permits a stipulated amount to enter duty-free or at a low rate, but a much higher duty is charged for additional quantities.

quota

Which quantitative nontariff barrier sets numerical limits for specific kinds of goods that a country will permit to be imported during a specified period?

quota

Which one of the following would be recognized in a country risk assessment?

revolution against the government

Unlawful acts of violence committed to achieve a variety of objectives are collectively known as

terrorism

Select all that apply What are the areas of increasing concern to governments as they try to protect business activities? (Check all that apply.)

terrorism piracy kidnapping cybercrime

A request for ransom is associated with the extreme act of

kidnapping

Under an orderly marketing arrangement, there is an agreement that each nation will preserve some of the national market for (local/global) producers.

local

Select all that apply Productivity per worker is greater in more developed countries because of _______. (Check all that apply.)

more capital per worker superior management advanced technologies

Select all that apply Which methods can a government use to minimize unfair international competition? (Check all that apply.)

national laws institutions such as the WTO negotiations between governments

When governments ______ private firms, they move them from private ownership to public ownership.

nationalize

During Margaret Thatcher's tenure as prime minister of Britain, she decreased the number of state-owned companies and sold more than 30 companies, thereby raising $65 billion for the country. Thatcher was implementing (nationalization/privatization).

privatization

Select all that apply Subsidies can take the form of _______. (Check all that apply.)

preferential tax treatment government participation in ownership cash payments to the firm

Select all that apply What are some of the reasons a government would restrict trade? (Check all that apply.)

preserve domestic jobs protect domestic infant industries promote national defense

Country risks are hardly ever political in nature.

F

The practice of country risk assessment is an exercise in understanding the local environment.

T

U.S. ocean shipping companies are benefiting from U.S. government subsidies.

T

It is estimated that worldwide there are more than _________ ransom and kidnapping situations every year.

16,000

Which of the following is an example of a government-owned business in the United States?

Export-Import Bank

Which U.S. legislation prohibits public-sector organizations from purchasing from foreign suppliers?

Buy American Act

Select all that apply What are the potential drawbacks to placing a ban on the export of advanced technologies? (Check all that apply.)

It reduces export revenues for the country's manufactures. It impedes the funding of continued innovation. It impedes efforts to sustain international market share.

Governmental intervention in trade reflects a governmental trade strategy in (Japan/United States).

Japan

Select all that apply In 2018, U.S. trade policy included active sanctions against _______. (Check all that apply.)

Libya Sudan North Korea

Businesses favor stable governments because fiscal, monetary, and political policies are then predictable.

T

Governments own the factors of production not only in communist countries, but in many market-based countries.

T

Kidnap, ransom, and extortion are techniques often used by terrorists against which insurance is available.

T

One historic function of government has been to create stable and predictable environments, in order to protect economic activities within its borders.

T

Sanctions are a type of trade restriction generally ineffective in forcing change in other countries.

T

Select all that apply Which of the following are characteristics of nontariff barriers? (Check all that apply.)

They can be quantitative and nonquantitative. They impose additional costs on customers. They impose additional costs on producers. They are forms of discrimination against imports.

True or false: A national system of law can minimize unfair international competition.

True

True or false: Kidnappings now outnumber shootings of aid workers.

True

Select all that apply Which of the following challenges can unstable governments present to businesses? (Check all that apply.)

a pattern of unpredictable change inability to ensure peace

Select all that apply Economists agree that political barriers to trade _________. (Check all that apply.)

are detrimental to trade reduce economic efficiencies

Those who believe it is important to protect infant industries claim that, in the long run, these industries will have a(n) ________ advantage, but in the meantime these firms need protection from imports.

comparative

A(n) ______ duty is a combination of specific and ad valorem duties.

compound

A(n) _____ _____ assessment reviews a country's economic situation and politics to determine how much risk to employees, property, and investment exists for firms doing business there.

country risk

What is the general term for duties paid on imports?

customs

Any illegal Internet-mediated activity that takes place in electronic networks is called _________.

cybercrime

The requirement that foods sold to the U.S. Department of Agriculture for use in school lunches must be produced in the United States is an example of a (quantitative/nonquantitative) nontariff barrier.

nonquantitative

Select all that apply Advocates for the protection of an infant industry claim that firms need protection from imports until they _______. (Check all that apply.)

obtain the required investment capital master production techniques achieve economies of scale train the labor force

A(n) ______ guarantees that a certain minimum import duty will be paid regardless of the actual invoice price.

official price

U.S. cargo ships have been hijacked by groups from West Africa who demand money for the release of the ship. This form of hijacking is called _________.

piracy

_____ is hijacking that includes kidnapping on the seas

piracy

When a manufacturer lowers its export price to force the importing nation's domestic producers out of business, expecting to raise the price once it has accomplished that objective, the manufacturer is engaged in _________.

predatory dumping

Select all that apply Which of the following are characteristic of a stable government? (Check all that apply.)

predictable fiscal policies predictable monetary policies maintains itself in power

Select all that apply Dumping is defined in several ways. Which of the following are definitions of dumping? (Check all that apply.)

selling a product abroad for less than the cost of production selling a product abroad for less than the price to third-party countries selling a product abroad for less than the price in the home market

A(n) ______ duty is a fixed sum of money charged for a specified physical unit of the product.

specific

Regardless of the value of the invoice, Kendall's company charges $0.14 per pound of butter exported. This tax is an example of a(n) ________ duty.

specific

Businesses like peace and predictability because they provide _________.

stability

Select all that apply What are the three major groupings of nonquantitative nontariff barriers? (Check all that apply.)

standards customs and other administrative procedures direct government participation in trade

In the past, the U.S. government provided payments to farmers as a way to manage surplus food resulting from increased production needed to fuel WWII and to feed Europe. The government offset and controlled the overproduction of these crops so as to prevent them from flooding the market. These payments to farmers were an example of _________.

subsidies

Which of the following permits a stipulated amount of a good to enter duty-free or at a low rate, but when that amount is reached, a much higher duty is charged for additional quantities?

tariff-rate quota

Select all that apply Which of the following are reasons why governments nationalize private firms? (Check all that apply.)

to increase profitability to follow an economic or political ideology to extract more money from the firms to control an earlier investment in a firm

Select all that apply Which of the following are reasons for the government to privatize a business? (Check all that apply.)

to raise money to reduce the size of government to ensure that a business runs more efficiently

When a government makes radical policy changes, it is viewed as (stable/unstable).

unstable