International Business 1

The tenet of ________ is that the welfare of society is best served by letting people pursue their own economic self-interest. A) individualism B) socialism C) anarchism D) communism

A) individualism

________ occurs when a firm exports goods or services to consumers in another country. A) Inward investment B) International trade C) Outsourcing D) Foreign direct investment

B) International trade

Which of the following factors hinders globalization of consumer goods market? A) Higher production costs in developed nations B) National differences in tastes and preferences C) Increased outsourcing of goods and services D) Homogenization of material culture

B) National differences in tastes and preferences

________ is/are best defined as shared assumptions about how things ought to be. A)Values B) Culture C) Society D) Norms

A) Values

The ________ is primarily responsible for policing the world trading system and making sure nation-states adhere to the rules laid down in trade treaties signed by member states. A) World Trade Organization B) International Court of justice C) World Bank D) International Development Association

A) World Trade Organization

Which of the following is focused on making low-interest loans to cash-strapped governments in poor nations that wish to undertake significant infrastructure investments? A) The World Bank B) The IMF C) The WTO D) The GATT

A) The World Bank

What is the term for a company's formal statement of the ethical priorities it expects all of its employees to follow? A) Moral courage B) Stakeholders pledge C) Difference principle D) Code of ethics

D) Code of ethics

3. ____ are the advantages gained by early entrants into a market. a. Early investor advantages b. First-mover advantages c. First-to-market advantages d. Late-mover advantages

b. First-mover advantages

The emphasis on individualism in the United States results in which of the following advantages? A) Executives are exposed to different ways of doing business. B) Managers tend to develop good general skills as well as company-specific experience. C) Teams are built within an organization to perform collective tasks. D) It is easy to achieve cooperation—both within a company and between companies.

A) Executives are exposed to different ways of doing business.

Which of the following is a feature of a democracy? A) Governance by people or elected representatives. B) Complete restriction of individual political freedom. C) Exercise of absolute control by one person or political party. D) Prohibition of entry to opposing political parties.

A) Governance by people or elected representatives.

The volume of world trade in merchandise growing faster than world GDP implies that: A) more firms are dispersing their production processes to global locations. B) the economies of the world's nation-states are becoming more independent from each other. C) the world is becoming poorer. D) the global economy is headed for a large downward correction.

A) more firms are dispersing their production processes to global locations.

Culture is ________. A) not static B) unchanging C) abstract D) static

A) not static

Violation of property rights done through legal mechanisms such as levying excessive taxation and requiring expensive licenses or permits from property holders is called ________. A) public action B) private action C) copyright violation D) collective action

A) public action

The ________ approaches to ethics hold that the moral worth of actions or practices is determined by their consequences. A) utilitarian B) naïve immoralist C) righteous moralist D) cultural relativist

A) utilitarian

In 2008 and 2009, the ________ became the forum though which major nations attempted to launch a coordinated policy response to the global financial crisis, which started in America. A) World Trade Organization B) Group of Twenty (G20) C) Group of Ten (G20) D) GATT

B) Group of Twenty (G20)

Which of the following is a consequence of globalization? A) Increase in barriers to cross-border trade B) Increasing outsourcing of services C) Decreasing interdependence between national economies D) Differentiation of material culture

B) Increasing outsourcing of services

Which of the following is true about the International Monetary Fund? A) It is primarily responsible for policing the world trading system. B) It is seen as the lender of last resort to nation-states whose economies are in turmoil. C) It was established to formulate a coordinated policy response to financial crises in developing nations. D) It is responsible for establishing multinational treaties to govern the global business system.

B) It is seen as the lender of last resort to nation-states whose economies are in turmoil.

Max Weber was a German sociologist who, in 1904, made the connection between ________ and "the spirit of capitalism." A) cross-cultural literacy B) Protestant ethics C) ethnocentrism D) collectivism

B) Protestant ethics

Which of the following refers to the extent to which individuals can move out of the strata into which they are born? A) Caste stratification B) Social mobility C) Individual potential D) Class system

B) Social mobility

Expatriate managers may experience more than the usual degree of pressure to violate their personal ethics because of which of the following? A) They are surrounded by their ordinary social context and supporting culture. B) They may be based in a culture that does not place the same value on ethical norms important in the manager's home country. C) They may be surrounded by local employees who have more rigorous ethical standards. D) They are psychologically and geographically closer to the parent company.

B) They may be based in a culture that does not place the same value on ethical norms important in the manager's home country.

A ________ system is based on a very detailed set of laws organized into codes. A) common law B) civil law C) theocratic law D) traditional law

B) civil law

According to the ________ point-of-view, a firm should adopt the ethics of the culture in which it is operating. A) righteous moralist B) cultural relativism C) naïve immoralist D) utilitarian approach

B) cultural relativism

Facilitating payments are: A) used to secure contracts that would otherwise not be secured. B) permitted under the amended Foreign Corrupt Practices Act. C) a direct violation of the Foreign Corrupt Practices Act. D) permitted so long as they designed only to gain exclusive preferential treatment.

B) permitted under the amended Foreign Corrupt Practices Act.

In a pure market economy: A) collectivist goals are given priority over individual goals. B) production is determined by the interaction of supply and demand. C) all productive activities are owned by the state. D) the prices at which goods are sold is determined by the government.

B) production is determined by the interaction of supply and demand.

Which of the following is an example of intellectual property? A) A lazer-tag game B) A software business C) A music score D) A theater

C) A music score

The protection of the right to private property is embedded within ________. A) Christianity B) Protestantism C) Islam D) Hinduism

C) Islam

________ predicts that the power of microprocessor technology doubles and its cost of production falls in half every 18 months. A) Say's Law B) Keynes's Law C) Moore's Law D) Sullivan Principles

C) Moore's Law

Cross-cultural literacy refers to: A) the phenomenon of merging and converging cultures. B) abstract ideas about what a group believes to be good, right, and desirable. C) an understanding of how cultural differences can affect business. D) an individual's self-concept derived from perceived membership in a relevant social group.

C) an understanding of how cultural differences can affect business.

According to the Friedman doctrine: A) if a manager of a multinational sees that firms from other nations are not following environmental legislation in a host nation, that manager should not either. B) a multinational's home-country standards of ethics are inappropriate to follow in foreign countries. C) businesses should not undertake social expenditures beyond those mandated by the law and required for the efficient running of a business. D) ethics are nothing more than the reflection of culture.

C) businesses should not undertake social expenditures beyond those mandated by the law and required for the efficient running of a business.

The ________ believed that socialism could be achieved only through violent revolution and totalitarian dictatorship. A) social democrats B) anarchists C) communists D) existentialists

C) communists

A Japanese executive's ritual of presenting a business card to a foreign business executive is an example of ________. A) mores B) values C) folkways D) attitudes

C) folkways

The average tariff rates for manufactured goods have fallen significantly since 1950 and now stand at about ________. A) 18% B) 4.8% C) 5.9% D) 1.5%

D) 1.5%

Identify the correct statement about the rights theories. A) People should be treated as ends never purely as means to the ends of others. B) The moral worth of actions or practices is determined by their consequences. C) The only social responsibility of business is to increase profits, so long as the company stays within the rules of law. D) Human beings have fundamental rights and privileges that transcend national boundaries.

D) Human beings have fundamental rights and privileges that transcend national boundaries.

Which of the following statements about individualism is true? A) Individualism promotes state ownership of the basic means of production, distribution, and exchange. B) Individualism creates an anti-business environment. C) Individualism promotes globalization. D) Individualism advocates for a democratic political system.

D) Individualism advocates for a democratic political system.

An American firm that sets up production units in China is accused of releasing untreated chemical waste into water bodies. The manager of the firm defends the firm stating that, factories in China set up by French and British firms also release untreated chemical waste into water bodies. What approach to business ethics is the manager using? A) Righteous moralist B) Utilitarian C) Cultural relativist D) Naive immoralist

D) Naive immoralist

Ethical systems are: A) social rules that govern people's actions toward each other. B) routine conventions of everyday life. C) shared beliefs and rituals that are concerned with the realm of the sacred. D) a set of moral principles, or values, that are used to guide and shape behavior.

D) a set of moral principles, or values, that are used to guide and shape behavior.

It is in the best interest of prospective employees to find out all they can about the: A) internal stakeholders of an organization. B) corporate social responsibility actions of an organization. C) external stakeholders of an organization. D) ethical climate in an organization.

D) ethical climate in an organization.

A civil law system tends to be less adversarial than a common law system because the: A) judges are guided by interpretations made in prior legal cases. B) judges have the freedom to interpret laws based on the situation. C) judges' decisions are based on religious teachings. D) judges' decisions are based on detailed legal codes.

D) judges' decisions are based on detailed legal codes.

The ________ refers to the extent to which a culture programs its citizens to accept delayed gratification of their material, social, and emotional needs. A) indulgence versus restraint dimension B) uncertainty avoidance C) power distance dimension D) long-term versus short-term orientation dimension

D) long-term versus short-term orientation dimension

In a ________ economy, certain sectors of the economy are left to private ownership and free market mechanisms while other sectors have significant state ownership and government planning. A) command B) market C) private D) mixed.

D) mixed

External stakeholders: A) are individuals or groups who own the business. B) are individuals or groups who work for the business. C) include all employees, the board of directors, and stockholders. D) typically comprise customers, suppliers, lenders, etc.

D) typically comprise customers, suppliers, lenders, etc.

4. The _____ occurs when a resource held in common by all, but owned by no one, is overused by individuals, resulting in its degradation. a. tragedy of the commons b. moral ignorance c. noblesse oblige d. veil of ignorance

a. tragedy of the commons

5. According to the _____, even if a manager of a multinational sees that firms from other nations are not following ethical norms in a host nation, that manager should maintain the standards of the company's home country. a. cultural relativist b. righteous moralist c. utilitarian d. naïve immoralist

b. righteous moralist

2. Totalitarianism: a. refers to a political system in which government is by the people, exercised either directly orthrough elected representatives. b. is based on a belief that citizens should be directly involved in decision making. c. is a form of government in which one person or political party exercises absolutecontrol over all spheres of human life. d. is based on the idea that the welfare of society is best served by letting peoplepursue their own economic self-interests.

c. is a form of government in which one person or political party exercises absolutecontrol over all spheres of human life.

6. BP, one of the world's largest oil companies, has made it part of the company policy to undertake "social investments" in the countries where it does business. There was no economic reason for BP to make this social investment, but the company believes it is morally obligated to give something back to the societies that have made their success possible. BP's actions are an example of: a. cultural relativism. b. the Friedman doctrine. c. noblesse oblige. d. the tragedy of the commons.

c. noblesse oblige.

1. Which of the following was established to maintain order in the international monetary system? a. The WTO b. The GATT c. The World Bank d. The IMF

d. The IMF