ch 16 global dim of bus

What is true of exporting? Multiple ChoiceA common pitfall of exporting is trying too hard to customize a product offering rather than "sticking with what you know."Most exporters have a very good understanding of the competitive conditions in the foreign market.A common pitfall of exporting is a poor understanding of competitive conditions in the foreign market.Securing financing is rarely a problem for exporters.

A common pitfall of exporting is a poor understanding of competitive conditions in the foreign market.

What is a disadvantage of countertrade? Countertrade requires employing lawyers who specialize in these unique types of contracts. Countertrade requires the firm to use an out-of-house trading company to which much of the profit will go. Countertrade contracts often involve high-quality, expensive goods that the firm cannot move enough of to be profitable. Countertrade contracts may involve the exchange of unusable or poor-quality goods.

Countertrade contracts may involve the exchange of unusable or poor-quality goods.

What is a major drawback of engaging in countertrade?

Countertrade may involve the exchange of unusable goods.

I n the ________blank program organized by the U.S. Department of Commerce, department representatives accompany groups of U.S. businesspeople abroad to meet with qualified agents, distributors, and customers. best prospects SCORE matchmaker

Matchmaker

Through its ________blank program, the SBA oversees about 11,500 volunteers with international trade experience to provide one-on-one counseling to active and new-to-export businesses. ELAN SCORE matchmaker trade fair

SCORE

Which statement is true of export credit insurance?

The Foreign Credit Insurance Association provides coverage against commercial risks and political risks.

What is characteristic of reactive firms? Reactive firms consider a variety of markets for selling their products and services. They consider exporting only after their domestic market is saturated. They create excess productive capacity and actively hunt for opportunities in foreign markets. They systematically scan foreign markets for profitable export opportunities.

They consider exporting only after their domestic market is saturated.

____ is primarily used for one-time-only deals in transactions with trading partners who are not creditworthy or trustworthy.

barter

As a document of title, a ________blank can be used to obtain payment or a written promise of payment before the merchandise is released to the importer. draft letter of credit bill of lading bill of exchange

bill of lading

The exporter endorses the ________blank so title to the goods is transferred to the bank.

bill of lading

________ occurs when a firm agrees to purchase a certain amount of materials back from a country to which a sale is made.

counterpurchase

________blank is a reciprocal buying agreement and occurs when a firm agrees to buy a certain amount of materials back from a country to which a sale is made.

counterpurchase

Naomi, the product line manager for a small family business believes that it is time for the company to begin exporting its product to foreign markets. Her father, the owner, is skeptical. To convince her father, Naomi points out that exporting is easier because international markets are less complex than domestic markets.firms that do not export are at a greater risk for economies of scale.exporting will allow the company to avoid taxation requirements in the domestic market.firms that do not

firms that do not export often lose out on significant opportunities for cost reduction.

Which service provider's primary task is to combine smaller shipments into a single large shipment to minimize shipping costs? Sogo shosha freight forwarder in-house shipping department export management company

freight forwarder

A banker's acceptance is a time draft that has been drawn on and accepted by a bank. is a sight draft that can be used as a negotiable instrument in banks. allows a buyer possession of the merchandise without signing any formal documents. is payable to the drawee immediately on presentation in a bank.

is a time draft that has been drawn on and accepted by the bank

A U.S. company would invest in export credit insurance when it

is exposed to the risk that an importer may default on payment.

Smith Brothers is exporting for the first time to France and has contracted with Miller Products in Brazil for an initial order valued at $55,000. Smith Brothers wants Miller Products to secure a document from a Brazilian bank that indicates the bank will pay Smith Brothers $50,000 upon presentation of specified documents by the exporter. What document is Smith Brothers asking for? bill of ladingbill of exchangetime draftletter of credit

letter of credit

The function of sogo shosha in japan in is to act as a customer service center for firms who have problems exporting goods into Japan. combine smaller shipments into a single large shipment to minimize shipping costs for their affiliate companies. handle all the voluminous paperwork associated with exporting goods into and out of Japan. proactively and continuously seek export opportunities for their affiliated companies.

proactively and continuously seek export opportunities for their affiliated companies.

A ________blank allows for a delay in payment—normally 30, 60, 90, or 120 days.

time draft

When First-Rate Fasteners, Incorporated exported fasteners and other small parts to a company in Poland, it allowed the company 60 days to pay for the parts. This is an example of a

time draft