International Business Test 4
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
A Idiosyncratic stage
National competitive advantage theory states that a nation's competitiveness in an industry depends on ________. A) the capacity of the industry to innovate and upgrade B) the level of government subsidy available C) obtaining first-mover status D) practicing neomercantilism
A) the capacity of the industry to innovate and upgrade
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
Answer C comparative advantage
A product's components are made in a country that can produce them at a high level of productivity and assembled in another country where productivity in assembly is high. This process resembles the theory of ________. A) comparative advantage B) advantage savings C) the international product life cycle D) factor proportions
Answer: A comparative advantage
Which element of national competitive advantage theory divides resources into two groups: basic and advanced? A) Demand conditions B) Factor conditions C) Related and supporting industries D) Firm, strategy, structure, and rivalry
Answer: B Factor conditions
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
Answer: B New product stage
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
Answer: B zero-sum game
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
Answer: C Absolute advantage
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
Answer: C Manufactured goods
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
Answer: C Maturing product stage
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
Answer: C absolute advantage
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
Answer: C comparative advantage
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
Answer: D comparative advantage
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
Answer: D living standards of its people
