Combo with mgmt - Ch 1,2,3,4,5
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32) ________ occurs between different states, regions, or cities within a country. A) Domestic trade B) Foreign direct investment C) International trade D) Mercantilism
a
35) Levis Jeans made in the United States and sold in Russia are an example of which of the following? A) U.S. export B) Outsourced product C) Globally licensed product D) U.S. import
a
35) The U.S. Department of Commerce estimates that for every $1 billion increase in exports, ________ jobs are created in the United States. A) 22,800 B) 35,000 C) 42,500 D) 63,000
a
36) The total value of goods and services exported by all nations each year is ________. A) nearly $15 trillion B) around $16 billion C) approximately $9 trillion D) more than $36 trillion
a
37) When a country has a weak currency relative to other nations, imports are ________ relative to domestic products. A) more expensive B) equal in price C) more attractive D) less expensive
a
37) Which of the following is defined as the use of computer networks to purchase, sell, or exchange products; service customers; and collaborate with partners? A) E-commerce B) Intranet C) International business D) Extranet
a
40) Merchandise trade between low- and middle-income nations accounts for about ________ percent of total world trade. A) 6 B) 23 C) 42 D) 61
a
42) Which of the following countries is the most important trading partner of the Central and Eastern European nations that recently joined the European Union? A) Germany B) Hungary C) Japan D) United States
a
48) The practice of mercantilism rested upon each of the following EXCEPT ________. A) enhanced trade deficits B) government intervention C) colonialism D) trade surpluses
a
50) The condition that results when the value of a country's imports is greater than the value of its exports is called ________. A) a trade deficit B) mercantilism C) a trade surplus D) absolute advantage
a
51) According to mercantilism, accumulation of national wealth depended on ________. A) increasing a nation's trade surplus B) expanding a nation's total value of trade C) expanding a nation's total volume of trade D) increasing a nation's trade deficit
a
52) Which of the following most likely represents the greatest accomplishment of the 1994 revision of the GATT? A) Creation of the World Trade Organization B) Creation of regional trade agreements C) Creation of the World Bank D) Creation of the International Monetary Fund
a
54) All of the following represent examples of regional trade agreements EXCEPT ________. A) WTO B) EU C) APEC D) NAFTA
a
60) When there are gains to be had by both countries that are party to an exchange, international trade is considered a(n) ________. A) positive-sum game B) zero-sum game C) negative-sum game D) equal-sum game
a
62) Which of the following developed the theory of comparative advantage? A) David Ricardo B) Adam Smith C) Bertil Ohlin D) Raymond Vernon
a
63) To complete his business bookkeeping each month, a small business owner spends about 20 hours and gives up $2,000 in income. If he hired a bookkeeper to do the work, the job would be completed in 15 hours and would cost $600. Should the owner hire the bookkeeper or continue to do the work himself? A) He should hire the bookkeeper because the bookkeeper has an absolute advantage in completing the books. B) He should do the bookkeeping himself because he has an absolute advantage in completing the books. C) He should hire the bookkeeper only if the bookkeeper agrees to give him a discount on the service price. D) He should hire the bookkeeper only if the bookkeeper is willing to complete the books more quickly.
a
67) Comparative advantage theory focuses on which of the following? A) Maximization of production and consumption B) Logistics planning C) Resource assessment D) Creation of trade surpluses
a
68) Which of the following was created to regulate fixed exchange rates and enforce the rules of the international monetary system? A) International Monetary Fund B) World Trade Organization C) European Union D) World Bank
a
70) The focus of factor proportions theory is on the ________. A) productivity of the production process B) cost-effectiveness of the production process C) use of abundant production factors D) use of expensive production factors
a
73) Factor proportions theory argues that a country should produce and export goods ________. A) that require factors of production that are most abundant B) where it is most productive to do so C) where it is most efficient to do so D) that require factors of production that are most advanced
a
75) The Leontief paradox describes evidence ________. A) that U.S. exports require more labor-intensive production than its imports B) in support of factor proportions theory C) that U.S. exports require more capital-intensive production than its imports D) that the assumptions of new trade theory are invalid
a
77) Which of the following makes the world market more accessible for companies that sell traditional products by lessening the cost and difficulties associated with global communication? A) Technology B) Franchising opportunities C) Licensing D) Financial capital
a
A) mercantilism B) absolute advantage theory C) factor proportions theory D) new trade theory
a
33) ________ are all goods and services sold abroad and sent out of a country. A) Global products B) Exports C) Global licenses D) Imports
b
34) Which of the following statements is NOT true about the services trade today? A) Trade in services makes up about 20 percent of total world trade. B) Trade in services tends to be more important for emerging markets. C) The United States is a top exporter of services in the world. D) Trade in services is growing for many nations.
b
38) The majority of total world merchandise trade occurs among ________. A) high-income countries and low- and middle-income nations B) high-income economies C) low- and middle-income nations D) emerging markets
b
39) Which of the following refers to convergence in buyer preferences in markets around the world? A) Homogenization of markets B) Globalization of markets C) Internationalization of markets D) Denationalization of markets
b
40) Which of the following is most likely not an effect of globalization? A) Increases in the variety of capital flows across national borders B) Increases in the economic isolation of developing countries C) Increases in the rate at which products are diffused worldwide D) Increases in the volume of cross-border transactions
b
41) Denationalization refers to ________. A) a loss of sovereignty among nations B) national boundaries becoming less relevant C) cooperation between nations to reduce trade barriers D) attempts by international organizations to resolve trade conflicts
b
43) ________ 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. A) Importing B) Globalization of production C) Global strategy development D) Globalization of markets
b
44) Companies are leaving Mexico for Asia and Europe because of differences in all of the following EXCEPT ________. A) education B) climate C) red tape D) taxes
b
47) The trade theory that nations should accumulate financial wealth, usually in the form of gold, by encouraging exports and discouraging imports is called ________. A) absolute advantage B) mercantilism C) comparative advantage D) factor proportions theory
b
53) The three main goals of the ________ are to help the free flow of trade, help negotiate the further opening of markets, and settle trade disputes between its members. A) General Agreement on Tariffs and Trade (GATT) B) World Trade Organization (WTO) C) World Bank D) International Monetary Fund (IMF)
b
55) Who proposed the theory of absolute advantage? A) David Ricardo B) Adam Smith C) Bertil Ohlin D) Raymond Vernon
b
58) The theory of absolute advantage destroys the mercantilist idea that international trade is a ________. A) positive-sum game B) zero-sum game C) negative-sum game D) no-win game
b
58) Which of the following countries has an average annual GDP growth rate of over 5%? A) United States B) India C) Canada D) France
b
60) According to the Globalization Index, which of the following nations ranks first as the most globalized nation overall? A) Japan B) Singapore C) China D) Jordan
b
63) The first age of globalization extended from ________. A) the mid-1700s to the 1850s B) the mid-1800s to the 1920s C) 1920 to 1950 D) 1960 to 2000
b
68) Both absolute and comparative advantage theories assume that ________ is the only resource used in the production process. A) land B) labor C) capital D) information
b
70) According to the opponents of globalization, which of the following occurs as a result of worker dislocation brought about by globalization? A) Increased labor costs for companies B) Gradual lowering of workers' wages C) Sudden widespread wage decreases D) Increased investment in individual education
b
71) Which of the following terms is used to refer to widespread job turnover throughout an economy? A) Redeployment B) Churning C) Wage differentials D) Attrition spectrum
b
74) Country X is a small country with a large population. Most of its land is devoted to housing and commercial developments; agricultural land is in short supply. According to the factor proportions theory, which of the following would Country X most likely import? A) Software B) Crops such as wheat and corn C) Fiber optic cables D) Consulting services
b
75) The three main branches of the debate over income inequality include each of the following EXCEPT ________. A) inequality within nations B) inequality in nongovernmental organizations C) inequality between nations D) global inequality
b
76) A business that has direct investments (in the form of marketing or manufacturing subsidiaries) abroad in multiple countries is called a ________. A) born global firm B) multinational corporation C) multiregional company D) direct exporter
b
78) During which stage of the international product life cycle theory does high purchasing power and buyer demand in an industrialized nation encourage a company to design and introduce a product concept? A) Idiosyncratic stage B) New product stage C) Maturing product stage D) Standardized product stage
b
79) The "global business environment" consists of four distinct elements: globalization, national business environments, the international business environment, and ________. A) falling trade and investment barriers B) international firm management C) technological innovation D) multinational corporations
b
31) Which of the following refers to the purchase, sale, or exchange of goods and services across national borders? A) Domestic trade B) Foreign direct investment C) International trade D) Mercantilism
c
32) Any commercial transaction that crosses the borders of two or more nations is known as ________. A) an export B) e-business C) international business D) an import
c
34) Olive oil made in Italy and sold in the United States is an example of which of the following? A) Global brand B) U.S. export C) U.S. import D) Standardized product
c
36) Most of the world merchandise trade is comprised of trade in ________. A) natural resources B) services C) manufactured goods D) knowledge-based goods
c
38) ________ is the trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies. A) International business B) Denationalization C) Globalization D) E-business
c
39) Trade among the world's high-income economies accounts for roughly ________ percent of total world merchandise trade. A) 20 B) 40 C) 60 D) 80
c
41) The smallest portion of total world trade takes place between ________. A) high-income countries and low- and middle-income nations B) high-income economies C) low- and middle-income nations D) emerging markets
c
42) Which of the following are products marketed in all countries essentially without any changes? A) National products B) Adapted products C) Global products D) Locally responsive products
c
44) Which of the following is an example of the globalization of production? A) Canadian consumers buy foods imported from Australia B) A Chinese company sells textiles to European car makers C) A U.S. company builds a manufacturing facility in India D) A Swiss watch manufacturer builds a manufacturing facility in Switzerland
c
45) Whereas relocating production to low-cost locales traditionally meant production of ________ almost exclusively, it increasingly applies to the production of ________. A) services; goods B) imports; exports C) goods; services D) domestic products; global brands
c
46) The most prominent mercantilist nations included all of the following EXCEPT ________. A) the Netherlands B) Spain C) the United States D) Portugal
c
49) Taxes levied on traded goods are known as which of the following? A) Quotas B) Nontariff barriers C) Tariffs D) Export zones
c
49) The condition that results when the value of a nation's exports is greater than the value of its imports is called ________. A) a trade deficit B) mercantilism C) a trade surplus D) absolute advantage
c
53) Nations following the theory of ________ believed that the world's wealth was limited and that a nation could increase its share of the pie only at the expense of its neighbors. A) absolute advantage B) comparative advantage C) mercantilism D) factor proportions
c
54) Which of the following refers to the ability of a nation to produce a good more efficiently than any other nation? A) Mercantilism B) Comparative advantage C) Absolute advantage D) Zero-sum game
c
55) 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 ________. A) gross domestic product (GDP) B) trade balance C) gross national product (GNP) D) production quotient
c
56) Adam Smith believed which of the following? A) International trade should be restricted by tariffs and quotas. B) Governments should intervene to maintain a balance of exports and imports. C) Market forces should determine trade flows. D) Countries should produce most goods themselves and trade as little as possible.
c
56) ________ give distributors and suppliers access to a company's database to place orders or restock inventories electronically and automatically. A) Intranets B) Videoconferencing C) Extranets D) Hackers
c
59) The theory of ________ measures a nation's wealth by the living standards of its people. A) mercantilism B) factor proportions C) absolute advantage D) advanced factors
c
62) The world's least global nations account for approximately what percentage of the world's total population? A) 12% B) 36% C) 50% D) 88%
c
64) Country A produces one ton of coffee using one unit of resources. Country B produces two tons of coffee using one unit of resources. Which of the following is true regarding Country A and Country B? A) Country A has an absolute advantage in producing coffee. B) Neither Country A nor Country B has an absolute advantage in producing coffee. C) Country B has an absolute advantage in producing coffee. D) Both Country A and Country B have an absolute advantage in producing coffee.
c
65) According to the theory of ________, trade is still beneficial even if one country is less efficient in the production of two goods, as long as it is less inefficient in the production of one of the goods. A) absolute advantage B) mercantilism C) comparative advantage D) factor proportions
c
66) Which of the following helped launch the second age of globalization? A) The end of the First World War B) The end of the Korean War C) The collapse of the wall separating East and West Berlin D) The end of the Second World War
c
69) The International Monetary Fund serves each of the following purposes EXCEPT ________. A) promoting international monetary cooperation B) facilitating balanced growth of international trade C) encouraging competitive exchange devaluation D) making financial resources temporarily available to members
c
71) Factor proportions theory was developed by ________. A) Smith and Ricardo B) Ricardo and Ohlin C) Hecksher and Ohlin D) Hecksher and Smith
c
72) Trade unions claim that by permitting international firms to continually move to nations with relatively lower labor standards, globalization ________ labor's bargaining power and forces overall labor standards ________. A) strengthens; to improve B) slows down; to be re-evaluated C) reduces; lower D) increases; higher
c
72) Under factor proportions theory, a nation's resources include all of the following EXCEPT ________. A) labor B) land C) information D) capital equipment
c
73) A special region in which companies can engage in tariff-free importing and exporting is called a(n) ________. A) regional economic integration zone (REIZ) B) U.S. customs zone (USCZ) C) export-processing zone (EPZ) D) free trade area (FTA)
c
77) The international product life cycle theory was put forth for which type of goods? A) Service goods B) Knowledge-based goods C) Manufactured goods D) Natural resources
c
79) During which stage of the international product life cycle theory does demand rise and remain sustained over a fairly lengthy period of time? A) Idiosyncratic stage B) New product stage C) Maturing product stage D) Standardized product stage
c
31) All goods and services purchased abroad and brought into a country are called ________. A) domestic products B) exports C) national products D) imports
d
33) One way to measure the importance of trade to a nation is to examine ________. A) its human development index relative to its CPI B) the availability of natural resources and ease of extracting them C) its comparative advantage relative to those of its neighbors D) the volume of an economy's trade relative to its total output
d
43) When doing business in the Pacific Rim, ________. A) carry business cards printed only in the home country language B) be persistent and aggressive, because Asians often take a while before they agree to a meeting C) don't accept invitations to dine at someone's house; go for a neutral location D) tone down the use of legal language
d
46) Which of the following is an example of a service that a company might produce in a foreign country to benefit from low-cost labor? A) House cleaning B) Dental care C) Appliance repair D) Research
d
47) Two major forces that underlie the expansion of globalization are ________ and ________. A) deregulation of tourism; the rise of nationalism B) economic interdependence; the decline of international organizations C) trade barriers; political unrest D) falling barriers to trade and investment; technological innovation
d
48) The purpose of the General Agreement on Tariffs and Trade (GATT) was to ________. A) create an international currency B) regulate exchange rates C) create regional trade organizations D) promote free trade
d
50) A limit placed on the quantity of an imported product is known as which of the following? A) Import sanction B) Tariff C) Embargo D) Nontariff barrier
d
51) A major flaw of the original General Agreement on Tariffs and Trade (GATT) was that it lacked the power to ________. A) erect barriers to trade B) dismantle bilateral trade agreements C) govern exchange rates D) enforce world trade rules
d
52) Colonies were important to mercantilist nations for all the following reasons EXCEPT ________. A) to serve as sources of inexpensive raw materials B) to serve as markets for higher-priced finished goods C) to serve as a source of profits for mercantilist powers D) to serve as a source of military protection
d
57) The theory of absolute advantage measures a nation's wealth by determining the ________. A) gold it has on reserve B) silver it has on reserve C) cash it has on reserve D) living standards of its people
d
57) Which of the following countries has a negative average annual GDP growth rate? A) Japan B) Germany C) Ivory Coast D) Zimbabwe
d
59) Each of the following countries has an average annual GDP growth rate larger than that of the U.S. EXCEPT ________. A) China B) India C) Russia D) Saudi Arabia
d
61) According to the Globalization Index, which of the following is NOT one of the top 10 most globalized nations? A) Switzerland B) Canada C) United States D) Saudi Arabia
d
61) When a country is not able to produce a good more efficiently than other nations, but produces the good more efficiently than it does any other good, it is said to have a(n) ________. A) absolute advantage B) resource advantage C) first-mover advantage D) comparative advantage
d
64) The first age of globalization was halted by all of the following EXCEPT ________. A) the Great Depression B) the Russian Revolution C) World War I D) the Cold War
d
65) For 75 years, from the start of the First World War to the end of the Cold War, there was a geographic divide between ________, and an ideological divide between ________. A) North and South; protectionism and socialism B) North and South; regionalism and globalization C) East and West; regionalism and globalization D) East and West; communism and capitalism
d
66) Which of the following is NOT a limitation of the absolute and comparative advantage theories? A) The theories assume that there are only two countries engaged in the production and consumption of just two goods. B) The theories assume that there are no costs for transporting traded goods from one country to another. C) The theories consider labor the only resource used in the production process. D) The theories assume that specialization in the production of one particular good results in gains in efficiency.
d
67) The ________ is an agency created to provide financing for national economic development efforts. A) International Monetary Fund B) World Trade Organization C) European Union D) World Bank
d
69) The ________ theory states that countries produce and export goods that require resources that are abundant and import goods that require resources in short supply. A) new trade B) absolute advantage C) international product life cycle D) factor proportions
d
74) Critics of globalization argue that globalization causes environmental conditions to ________. A) increase gradually B) remain at status quo levels C) decline slightly, then level off D) decline significantly
d
76) The international product life cycle theory was developed by ________. A) Milton Friedman B) Karl Marx C) Michael Porter D) Raymond Vernon
d
78) Key characteristics of born global firms are an ________ and knowledge-based organizational capabilities. A) inventive R&D center B) insular management style C) integrated global network D) innovative culture
d
80) During which stage of the product life cycle are companies looking for low-cost production bases in developing nations to supply a growing worldwide market? A) Idiosyncratic stage B) New product stage C) Maturing product stage D) Standardized product stage
d
