Management: Chapter 5

countertrade agreement.

China's arrangement with the Congo to barter infrastructure in exchange for metals is an example of a protective tariff. balance of trade. quota. countertrade agreement.

d. International Monetary Fund

If Peru wants to purchase machine parts from a German company but lacks German marks, it will probably go to which of the following institutions to borrow the marks? a. The International Bank b. Citigroup Bank c. The World Bank d. International Monetary Fund

b. a direct investment.

The fact that the American company 3M owns a film-manufacturing facility in Italy is an example of a. a contract manufacturer. b. a direct investment. c. a trading company. d. licensing.

The suspension of trade in a particular product by the government

What is an embargo? The market value of a nation's total output of goods and services for a given period The suspension of trade in a particular product by the government The buying, selling, and trading of goods and services across national boundaries The maximum number of units of a particular product that may be imported into a country

Franchising

What name is given to a form of licensing in which a company agrees to provide a name, logo, methods of operation, advertising, products, and other elements associated with the company's business, in return for a financial commitment and the agreement to conduct business in accordance with the company's standard of operations? Franchising Outsourcing Licensing Exporting

Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries

Which of the following characteristics relates to the World Bank? A global association of member countries that promotes free trade Basic mission is to oversee the international monetary system and help ensure stable currencies and exchange rates throughout the world Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries A partnership formed to create competitive advantage on a worldwide basis

a. Import tariff

Which of the following refers to a tax levied by a nation on goods bought outside its borders and imported into the country? a. Import tariff b. Exchange rate c. Licensing d. Quota

The purchase of goods and services from a foreign source

What is meant by importing? Involves transferring manufacturing or other functions (such as data processing) to countries where labor and supplies are less expensive The purchase of goods and services from a foreign source The sale of goods and services to foreign markets Occurs when a company hires a foreign company to produce a specified volume of the firm's product to specification

a. The purchase of goods and services from a foreign source

What is meant by importing? a. The purchase of goods and services from a foreign source b. The sale of goods and services to foreign markets c. Involves transferring manufacturing or other functions (such as data processing) to countries where labor and supplies are less expensive d. Occurs when a company hires a foreign company to produce a specified volume of the firm's product to specification

Exchange rate

What name is given to the ratio at which one nation's currency can be exchanged for another nation's currency or for gold? Direct investment Exchange rate Quota Exchange controls

d. a countertrade agreement.

When a nation pays for imports with its own goods, it is using a. an embargo. b. a quota. c. an ad valorem tariff . d. a countertrade agreement.

A strategy in which organizations treat the entire world or major regions of it as the domain for conducting business

Which of the following characteristics relates to global business (globalization)? The buying, selling, and trading of goods and services across national boundaries A strategy in which organizations treat the entire world or major regions of it as the domain for conducting business Allows selected American firms desiring international trade to form monopolies in order to compete with foreign cartels Acquires goods in one country and sells them to buyers in another country

International business

Which of the following refers to the buying, selling, and trading of goods and services across national boundaries? International business Importing North American Free Trade Agreement (NAFTA) Global business (globalization)

b. minimized

If companies do research to learn about cultural differences before engaging in trade in a particular country, then problems arising from these cultural differences can be a. unaffected b. minimized c. completely avoided. d. exploited.

d. an embargo.

The United States' prohibition of the importing of Cuban cigars is an example of a. a countertrade. b. a quota. c. a tariff. d. an embargo.

strategic alliance.

The agreement between Japan's Sony Corporation and the Swedish telecommunication company Ericsson to make mobile phones is an example of a direct investment. cartel. joint venture. strategic alliance.

d. strategic alliance.

The agreement between Japan's Sony Corporation and the Swedish telecommunication company Ericsson to make mobile phones is an example of a a. direct investment. b. cartel. c. joint venture. d. strategic alliance.

A corporation, such as IBM, ExxonMobil, and Nestlé, that operates on a worldwide scale, without significant ties to any one nation or region

What is a multinational corporation (MNC)? A corporation, such as IBM, ExxonMobil, and Nestlé, that operates on a worldwide scale, without significant ties to any one nation or region A company that acquires goods in one country and sells them to buyers in another country A partnership formed to create competitive advantage on a worldwide basis A company that wants to do business in another country and finds a local partner (occasionally, the host nation itself) to share the costs and operation of the business

b. Franchising

What name is given to a form of licensing in which a company agrees to provide a name, logo, methods of operation, advertising, products, and other elements associated with the company's business, in return for a financial commitment and the agreement to conduct business in accordance with the company's standard of operations? a. Licensing b. Franchising c. Outsourcing d. Exporting

Cartel

What term describes a group of firms or nations that agree to act as a monopoly and not compete with each other? Global business (globalization) Embargo Cartel World Trade Organization (WTO)

a. Cartel

What term describes a group of firms or nations that agree to act as a monopoly and not compete with each other? a. Cartel b. Embargo c. Global business (globalization) d. World Trade Organization (WTO)

Licensing

What term describes a trade arrangement in which one company--the licensor--allows another company--the licensee--to use its company name, products, patents, brands, trademarks, raw materials, and/or production processes in exchange for a fee, or royalty? International business Franchising Quota Licensing

Organization of Economic Cooperation and Development (OECD)

What term describes an international economic organization comprised of 30 countries that accept the basic principles of free-market economies and representative democracy, and that recommend and promote policies to improve the well-being of consumers and societies across the world? World Bank European Union (EU) Organization of Economic Cooperation and Development (OECD) International Monetary Fund (IMF)

b. Exchange controls.

What term describes restrictions on the amount of a particular currency that may be bought or sold? a. Cartel b. Exchange controls. c. Embargo. d. Exchange rate.

Infrastructure

What term describes the physical facilities that support a country's economic activities, such as railroads, highways, ports, airfields, utilities and power plants, schools, hospitals, communication systems, and commercial distribution systems? Infrastructure Joint venture Outsourcing Strategic alliance

b. Direct investment

What term describes the purchase of overseas production and marketing facilities, in which a company may control the facilities outright, or it may be the majority stockholder in the company that controls the facilities? a. International business b. Direct investment c. Joint venture d. Strategic alliance

contract manufacturing.

When Reebok has some of its athletic shoes produced by a Korean company, but the Reebok name still appears on the shoes, this illustrates contract manufacturing. licensing. direct investment. exporting.

is exporting the lenses.

When Weseeyu, Inc., of Rochester, New York, sells contact lenses to people in Moscow, Russia, the company is exporting the lenses. is importing the lenses. has an absolute advantage. is increasing the trade deficit.

Effectively merged Canada, the United States, and Mexico into one market of about 400 million consumers by eliminating most tariffs and trade restrictions on agricultural and manufactured products among the three countries

Which of the following characteristics relates to the North American Free Trade Agreement (NAFTA)? Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries Effectively merged Canada, the United States, and Mexico into one market of about 400 million consumers by eliminating most tariffs and trade restrictions on agricultural and manufactured products among the three countries A global association of member countries that promotes free trade Allows selected American firms desiring international trade to form monopolies in order to compete with foreign cartels

Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries

Which of the following characteristics relates to the World Bank? Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries A partnership formed to create competitive advantage on a worldwide basis A global association of member countries that promotes free trade Basic mission is to oversee the international monetary system and help ensure stable currencies and exchange rates throughout the world

c. outsourcing

You are the executive vice president of Banana Computer, Inc. You have a competitive machine, but your major competitor has the benefit of large-scale production, making its products less expensive to manufacture. In order to remain price-competitive, you send your parts and subassemblies to Mexico for the final stage of assembly, thereby taking advantage of a. contract manufacturing. b. a strategic alliance. c. outsourcing. d. direct investment.

Social and cultural differences

You are the international marketing manager for Brides & Grooms, Inc., a designer and manufacturer of wedding apparel. This year's fashions are featuring white for the entire wedding party. You scheduled this year's Asian kick-off for next Monday in Tokyo, when you discover that white is the Japanese color of mourning. What did you overlook? Competitors' designs Asian fashion taste Social and cultural differences Asian marketing trends

b. a direct investment.

You are the president of Henry Motor Corp., and you see the great potential markets in Eastern Europe for personal transportation. Your plan is to purchase an old Soviet tank plant and convert it into an auto factory. The Russian government welcomes your plan, which is an example of a joint venture. a direct investment. a strategic alliance. contract manufacturing