Intro to Business- Chapter 3 Test

Access to factors of production

Grettzee, a musical instruments manufacturing company, imports high-quality maple wood from Resumbro, a South Asian country where maple is found in abundance. Which of the following is most likely to have influenced Grettzee's decision to import raw materials from Resumbro?

Countertrade

Companies typically engage in ____ to meet the needs of customers that don't have access to hard currency or credit

inflow of innovation

Prost was the first automobile company in the world to introduce child safety locks in its vehicles. This feature soon became a major selling point for consumers all over the world. As a result, other automobile companies began providing a similar feature in their vehicles. In this scenario, which of the following is most likely to have influenced other companies to install child safety locks?

tends money to member nations

To achieve its basic mission of promoting international economic cooperation and stable growth the International Monetary Fund ______

socioeconomic differences

In Fidaro, a North American country, punctuality is considered a sign of integrity. On the other hand, in Gawry, an African country, punctuality is considered a sign of anxiety and is given less importance. This exemplifies______

sociocultural differences

In the context of barriers to international trade, ______ include differences among countries in language, attitudes, and values.

It has the potential for high profits

In the context of foreign direct investment, which of the following is a benefit of offshoring?

exchange rate

In the context of global trade, the _____ is a measurement of the value of one nation's currency relative to the currency of other nations.

embargo

In the context of international trade restrictions, a(n) ______ is a total ban on the international trade of a certain item.

An Asian company that can only import a limited amount of crude oil from an Arab country because of its International Trade Restrictions

In the context of international trade, which of the following companies is facing the barrier of legal differences?

Airports

In the context of key economic considerations when entering a foreign market, which of the following is an example of the transportation infrastructure in a country?

reduced risk

Merticao, a French textile company, supplied most of its products to its primary market in Hestonia, a North American nation. However, when Hestonisa faced an economic downturn and its citizens began to reduce their expenditures, Merticao began to focus more on its domestic market. As a result, Merticao was able to survive the loss of its primary market because of ____ in global trade.

Exporting

Neminski, an Arab country, is renowned for its rich oil reserves. It earns approximately $1.3 billion annually by selling crude oil to other countries. Given this information, Neminski is most likely involved in____

foreign outsourcing

Rubicon Inc., an American guitar manufacturing company, signed a contract with a supplier in Umreia, an Asian country, to manufacture guitars. Rubicon then imported these products and sold them in its markets under its own brand name. Rubicon did this because of the availability of cheap labor in Umreia that substantially cut down Rubicon's cost of production. In this scenario, Rubicon is most likely involved in

Opportunity cost

When a country produces more of one good, it must produce less of another good (assuming that resources are finite). The value of the second-best choice—the value of the production that a country gives up in order to produce the first product—represents the ____ of producing the first product.

trade surplus

When the total value of a nation's exports is higher than the total value of its imports, that country has a(n)_____.

An Asian country that provides sugarcane to an African country in exchange for jute

Which of the following countries is involved in countertrade?

An Asian country that produces quality automobiles with little opportunity cost compared to other countries

Which of the following countries most likely has a comparative advantage?

Free trade

_____ refers to the unrestricted movement of goods and services across international borders

foreign licensing

______ is the authority granted by a domestic firm to an overseas firm for the rights to produce and market its product or to use its trademark/patent rights in a defined geographical area

common market

A group of countries that have eliminated tariffs and harmonized trading rules to facilitate the free flow of goods among the member nations___