IB Ch 1: Globalization Quiz

Which of the following is an example of a multinational corporation? 1. Sable, a non-profit organization, is funded by countries from all over the world. 2. Crayola Inc., an American smartphone company, operates in 36 countries across the globe. 3. Educruz, a non-profit organization, provides advisory services to business schools in the developing world. 4. Teal Inc., an Irish steel company, imports iron ore from China.

Crayola Inc., an American smartphone company, operates in 36 countries across the globe.

Bianca is a student of international business at the University of Phoenix. She is of the opinion that the world is not fully connected. She believes that the global financial markets are controlled only by a few cities and that most businesses still operate in domestic markets. Bianca's views are consistent with the _____ argument. 1. spiky world 2. flat world 3. round world 4. coherent world

round world

Which of the following is a difference between developed markets and emerging markets? 1. Developed markets have economic policies of open trade and free markets, whereas emerging markets have economic policies that restrict open trade and free markets. 2. Developed markets have high levels of economic activity, whereas emerging markets have low levels of economic activity. 3. Developed markets experience average economic growth of around 2 percent/year, whereas emerging markets experience economic growth of at least 4 percent/year. 4. Developed markets have an intermediate income level among citizens, whereas emerging markets have a low income level among citizens.

Developed markets experience average economic growth of around 2 percent/year, whereas emerging markets experience economic growth of at least 4 percent/year.

Cora, an American citizen, is a critic of globalization. She believes that globalization has done more harm than good. She contends that globalization has detrimental effects on developed markets. Which of the following statements supports her contention? 1. Globalization makes products and services expensive. 2. Globalization has decreased the rate of development for lifesaving devices. 3. Globalization has increased wage-related expenses. 4. Globalization makes it easy for employers to move jobs to cheaper locations.

Globalization makes it easy for employers to move jobs to cheaper locations.

According to author Thomas Friedman, which of the following is true of the flat world? 1. Ten percent of activity is conducted globally, and the remaining ninety percent is conducted domestically. 2. Most of the world's cities are much more connected at the local level than they are to any other domestic city, and more connected domestically than to any foreign city. 3. Individuals in poor countries with limited infrastructure are able to compete with people in rich, well-developed countries. 4. The few cities that dominate international financial markets — Frankfurt, Hong Kong, London, New York, Singapore — represent the peak of global integration.

Individuals in poor countries with limited infrastructure are able to compete with people in rich, well-developed countries.

Which of the following is true of globalization? 1. It builds on the principle of sovereignty to strengthen the relationships that connect us. 2. It increases socioeconomic equality in emerging markets. 3. It makes it difficult for employers to move jobs to cheaper locations. 4. It makes it difficult to buy and sell internationally.

It builds on the principle of sovereignty to strengthen the relationships that connect us.

Which of the following is true of the World Trade Organization? 1. It was established to rescue countries from financial crises. 2. It focuses on preventing war by promoting economic development in poor countries. 3. It came about as a result of negotiations in the 1990s. 4. It is considered a “lender of last resort” to nations whose economies are in trouble.

It came about as a result of negotiations in the 1990s.

Which of the following is true of the G20? 1. Its chair rotates quarterly among the members and is responsible for hosting the quarterly summit. 2. It consists of finance ministers and central bank governors of the 19 largest economies in the world. 3. It consists of representatives from the International Monetary Fund and the World Bank. 4. It operates with a permanent secretariat or staff.

It consists of finance ministers and central bank governors of the 19 largest economies in the world.

Identify a true statement about the World Trade Organization. 1. It focuses on preventing war by promoting economic development in poor countries. 2. It was established to rescue countries from financial crises. 3. It came about as a result of negotiations in the 2000s. 4. It ensures that member nations impose the minimal number of restrictions on each other.

It ensures that member nations impose the minimal number of restrictions on each other.

Which of the following is true of globalization of production? 1. It includes obtaining land, labor, and capital locally. 2. It is limited to manufacturing. 3. It includes the component parts, skill sets, or information required to produce a product or service. 4. It helps companies take advantage of national differences in cost and quality.

It helps companies take advantage of national differences in cost and quality.

Which of the following is true of arbitrage? 1. It is limited to manufacturing. 2. It involves searching for deals on production factors across geographic boundaries. 3. It treats differences across nations as constraints. 4. It involves obtaining land, labor, and capital from domestic markets.

It involves searching for deals on production factors across geographic boundaries.

Which of the following is true of the United Nations? 1. It is funded by over 1,000 member companies, typically multinational corporations with more than $5 billion in revenue. 2. It provides heavily subsidized loans to poor governments in an effort to help them build infrastructure such as roads, the private sector, and public utilities. 3. It ensures that international trade runs freely and fairly between countries and that member nations impose the minimal number of restrictions on each other. 4. It was established as a way to get countries to resolve their differences through diplomacy, with the goal of maintaining and promoting global peace.

It was established as a way to get countries to resolve their differences through diplomacy, with the goal of maintaining and promoting global peace.

Which of the following best defines the 10% presumption? 1. Only about 10 percent of products produced in the United States are industrial products; the remaining 90 percent are consumer products. 2. Only about 10 percent of the world’s organizations are multilateral; the remaining 90 percent are bilateral. 3. Only about 10 percent of activity is conducted globally; the remaining 90 percent is domestic. 4. Only about 10 percent of countries are sovereign nations; the remaining 90 percent are not sovereign.

Only about 10 percent of activity is conducted globally; the remaining 90 percent is domestic.

Which of the following best illustrates global convergence? 1. Micra Inc., an Indian mining company, engages in corporate social responsibility by providing training services to local schools. 2. Sylvester Inc., an American car-manufacturing company, uses the Japanese business philosophy of kaizen. 3. Hexagon Corp., a steel company in the United States, has many plants in different parts of the country. 4. Swedish company IKEA that sells and manufactures its bookshelves in many countries.

Swedish company IKEA that sells and manufactures its bookshelves in many countries.

Which of the following examples best illustrates the globalization of production? 1. Taupe, an Australian non-profit organization, is funded by Australian multinational companies. 2. Tanner Inc., an American publishing company, outsources writing services to India. 3. Hazel Inc., an Irish textile company, engages in corporate social responsibility. 4. Silva Hotels & Resorts, a Brazilian hotel chain, provides hospitality services to tourists from all around the world.

Tanner Inc., an American publishing company, outsources writing services to India.

Literia, a country in Asia, is experiencing a financial crisis. Its currency has lost much of its value, and the country's currency reserves are depleting. In this scenario, which of the following multilateral organizations is most likely to provide loans to Literia to rescue it from its financial crisis? 1. The United Nations 2. The World Bank 3. The World Trade Organization 4. The International Monetary Fund

The International Monetary Fund

Imagine that Belseria, a developing country in South America, recently became a member of a multilateral organization that works toward preventing war by promoting economic development in poor countries. The organization assists poor countries in building their infrastructure by providing them with heavily subsidized loans. Given this information, it can be said that Belseria most likely became a member of the _____. 1. International Monetary Fund 2. Red Cross 3. World Trade Organization 4. World Bank

World Bank

Nebula Inc. is an American smartphone manufacturer that sells smartphones in 36 countries across the globe. Nebula makes both low-end and high-end smartphones to cater to the needs of different markets across the world. There is a high demand for Nebula’s low-end smartphones chiefly in developing nations. Its high-end smartphones have buyers mostly in developed nations. One of the challenges that Nebula faces is planning its sales strategy to suit different markets. Given this information, it can be said that Nebula’s smartphones are an example of _____. 1. consumer products 2. natural products 3. perishable products 4. industrial products

consumer products

Ervetia is a country in Europe, which has recently adopted a new economic policy. The government of Ervetia has now opened doors to foreign investments and free trade relations with other countries. The number of private companies in Ervetia has also started increasing at a fast pace. Given this information, it can be said that Ervetia is most likely a(n) _____. 1. frontier market 2. developed market 3. prediction market 4. emerging market

emerging market

Niall is an assembly-line worker in a car-manufacturing firm in Detroit. Assembly-line workers like Niall constitute the _____ of the car-manufacturing firm. 1. intangible resources 2. visible artifacts 3. economies of scale 4. factors of production

factors of production

Maya Inc., an Indian apparel company, now sells its apparels in the United States, Canada, Australia and New Zealand. Derek, the CEO of Maya Inc., believes that free access to markets, few barriers to competition, and uniform trade regulations have enabled Maya Inc. to expand its business operations internationally. Derek’s beliefs are consistent with Thomas Friedman’s theory of the _____. 1. round world 2. flat world 3. divided world 4. spiky world

flat world

Dasom Inc., a South Korean smartphone manufacturer, sells its smartphones in 64 countries around the world and has offices in 36 counties. Dasom's business expansion best exemplifies _____. 1. globalization 2. nationalization 3. subsidization 4. commodification

globalization

The Commerce Coalition (CC) is an intergovernmental organization operating in South Asia that consists of seven member nations. The CC was established to enable free trade across these seven countries of South Asia. A citizen of any of the member nations can easily purchase goods produced in another member nation without paying additional taxes. Given this information, it can be said that the large market created by the CC is an example of a(n) _____. 1. gray market 2. monopolistic market 3. globalized market 4. oligopolistic market

globalized market

According to Amartya Sen, a Nobel Prize—winning economist, globalization: 1. has enriched the world scientifically and culturally. 2. has led to the advent of the "round world." 3. has economic repercussions. 4. perpetuates inequality throughout the world.

has enriched the world scientifically and culturally.

Sanctity is a non-profit group that works toward increasing female literacy globally. It strives to promote women’s education in developing nations. Its members are engaged in providing training and advisory services to schools and colleges in developing nations. Sanctity is funded and managed by several governments worldwide. Given this information, it can be said that Sanctity is a _____. 1. multinational corporation 2. multilateral organization 3. limited liability company 4. sole proprietorship

multilateral organization