question

A survey of CEOs of the 162 largest firms on Fortune's list of the 500 largest American corporations found that the internationally oriented courses that were viewed as being the most important for early career positions included topics related to:

answer

D. all of the above.

question

The increased internationalization of business requires __________ to have a basic knowledge of international business.

answer

all managers

question

. If you already have a job, you can enhance your opportunities for international experience by:

answer

all of the above.

question

As stated in the text, an international business is:

answer

a business whose activities involve crossing national borders

question

Foreign business denotes:

answer

the domestic operations within a foreign country.

question

A multidomestic company is:

answer

. an organization with multicountry affiliates.

question

A global company is:

answer

an organization that attempts to standardize operations worldwide.

question

International business differs from domestic business in that a firm operating across borders must deal with:

answer

. all of C, D, and E.

question

The domestic environment is composed of all the uncontrollable forces originating in the __________ that surround and influence the life and development of the firm.

answer

home country

question

The kinds of forces in the foreign environment are __________ those in the domestic environment except that they occur in foreign nations

answer

the same as

question

Decision making in the international environment is __________ it is in a purely domestic environment.

answer

. more complex than

question

Unconscious reference to one's own cultural values when judging behavioral actions of others in a new and different environment is called:

answer

self-reference criterion.

question

__________ was the world's leading manufacturing country for about 1,800 years, until it was replaced by Britain in about 1840.

answer

none of the above.

question

International business really began:

answer

before the time of Christ.

question

UNCTAD, an agency of the United Nations, estimates there are __________ international firms in the world.

answer

82,000

question

Due to the expanding importance of foreign-owned firms in local economies, host governments have made their policies toward these companies:

answer

. more liberal.

question

_______ refers to the transportation of any domestic good or service to a destination outside a country or region.

answer

Exporting

question

The level of service exports worldwide increased more than _______ between 1980 and 2010.

answer

10-fold

question

According to the text, the tendency toward an international integration of goods, technology, information, labor, and capital, or the process of making this integration happen, is called:

answer

economic globalization.

question

Which of the following are identified in the text as being drivers of globalization?

answer

Technological

question

The major globalization drivers include all of the following except:

answer

social.

question

According to supporters of the globalization of trade and investment, free trade:

answer

creates more and better jobs.

question

According to opponents of the globalization of trade and investment:

answer

all of the above.

question

Reasons for international firms to enter into foreign markets are linked to which of the following desires?

answer

All of the above.

question

The major globalization drivers include all of the following except:

answer

. cultural.

question

The worldwide stock of outward FDI is estimated to have increased _______ between 1990 and 2010.

answer

9 fold

question

According to the Exporter Data Base, small and medium-sized enterprises accounted for ___________ of all U.S. exporters.

answer

nearly 98 percent

question

One measure of the magnitude of international trade and how it has grown is that _____________ of everything grown or made in the world is now exported.

answer

B. 25 percent

question

The level of merchandise exports in 2010, worldwide, was:

answer

$15.2 trillion.

question

The level of services exports in 2010, worldwide, was:

answer

$3.7 trillion.

question

Between 1980 and 2010, the level of merchandise exports from Africa:

answer

increased by 250 percent.

question

In examining the volume of international trade:

answer

the proportion of manufacturing value added generated by South and East Asia has quadrupled since 1980.

question

More than one-half of the exports from developing countries go to __________ countries, and this proportion has been _____________ over the past 35 years.

answer

. developed; decreasing

question

When considering where to export, advantages to managers of focusing on a nation that is already a sizable purchaser of goods coming from the home country include:

answer

export and import regulations are not insurmountable.

question

When considering where to export, advantages to managers of focusing on a nation that is already a sizable purchaser of goods coming from the home country include:

answer

satisfactory transportation facilities have already been established

question

The three largest markets for American exports of goods in 2010 were:

answer

Japan, Mexico, and China.

question

The three nations that exported the largest amount of goods to the United States in 2010 were:

answer

Canada, Mexico, and China.

question

Many of the Asian countries that are major exporters to the United States are also significant importers of American goods because:

answer

all of the above.

question

Supporters of mercantilism:

answer

viewed accumulation of precious metals as an activity essential to a nation's welfare.

question

Mercantilists believed that:

answer

. a nation should have an export surplus in order to accumulate precious metals

question

Adam Smith claimed that:

answer

.market forces, not government controls, should determine direction, volume, and the composition of international trade.

question

The capability of one nation to produce more of a good with the same amount of input than another country is:

answer

an absolute advantage

question

If Ecuador has an absolute advantage in coffee and Argentina in wheat, then, according to trade theory:

answer

all of the above.

question

A nation having absolute disadvantages in the production of two goods with respect to another nation has ___________ in the production of the good in which its absolute disadvantage is less

answer

a comparative advantage

question

According to the theory of comparative advantage:

answer

none of the above

question

Locating activities in another nation is:

answer

offshoring.

question

Offshoring is an application of:

answer

comparative advantage.

question

According to trade theory:

answer

traders need to know the exchange rate between their own currency and that of the nation they are considering trading with before they can decide whether it is advantageous to import, export, or buy locally.

question

Theory based on ____________________ states that international and interregional differences in production costs occur because of differences in the supply of production factors.

answer

resource endowments

question

The theory of resource endowment:

answer

. states that a nation will trade goods that can be produced with the production factor that is most abundant.

question

The international product life cycle:

answer

is concerned with the role of innovation in trade patterns.

question

Economies of scale and the experience curve:

answer

. explain why many companies will engage in international trade.

question

Which of the following elements are included in Porter's Diamond Model of national advantage?

answer

none of the above

question

Porter's Diamond Model of national advantage:

answer

claims that the ability of local firms in a country to utilize the country's resources to gain a competitive advantage is based on demand conditions, factor conditions, substitute products, and firm strategy, structure, and rivalry.

question

_______________ occurs primarily because of relative price differentials among nations

answer

International trade

question

To sum up international trade theory, we can say that the primary reason for trade is:

answer

the existence of price differentials among nations

question

Which of the following is explained by international trade theory?

answer

All of the above

question

Firms from __________ had the largest total outstanding stock of direct overseas investment at the beginning of 2010.

answer

the United States

question

At the beginning of 2010, the value of the outstanding stock of foreign direct investment of all nations totaled more than:

answer

$19 trillion.

question

Regarding the annual outflows of foreign direct investment:

answer

much of the recent increase has been associated with mergers, acquisitions, and other international investments made by companies in industries facing increased competition and global consolidation.

question

Regarding foreign direct investment and trade:

answer

fewer government barriers to trade, increased competition from globalizing firms, and new production and communications technology are causing many international firms to disperse the activities of their production systems to locations close to available resources.

question

Regarding economic and social development:

answer

. for the Trade and Development Index, the best regional performance among developing countries was that of the countries of the East Asia and Pacific region.

question

The monopolistic advantage theory suggests that firms in oligopolistic industries are likely to _______________ foreign direct investment when they have technical and other .

answer

increase

question

The monopolistic advantage theory states that:

answer

FDI is made by firms in oligopolistic industries possessing technical advantages over local companies.

question

. IMF quotas are determined by the relative size of a nation in the global economy and:

answer

all of the above.

question

The IMF initially played a central role in:

answer

setting fixed exchange rates among nations' currencies with an established par value based on gold.

question

The major function of the World Bank is to serve as a:

answer

nonprofit banking cooperative for its members to meet development needs.

question

The IBRD is a major institution of the World Bank whose function is to loan to:

answer

middle-income and creditworthy poor nations.

question

The WTO exists to:

answer

establish and help implement rules of trade among nations in order to increase trade flows

question

Is the WTO's idea of "fair competition" really a code phrase for free trade?

answer

Not really. Trade relationships among nations can be exceedingly complex, and the WTO supports fair competition, which may mean freer trade rather than free trade.

question

The Doha Development Agenda is:

answer

. an extended conference of the WTO initially convened in Doha.

question

The WTO has made progress on trade-related intellectual property rights (TRIPS). An example of this progress is:

answer

an agreement that property rights should not take precedence over public health.

question

Regional trade agreements such as NAFTA can be seen to impact the WTO:

answer

negatively, because they undercut the nondiscrimination principle of the WTO.

question

In a free trade area, members drop internal tariffs. External tariffs:

answer

are maintained independently by each member.

question

Economic integration often progresses:

answer

in stages, from free trade area to customs union to common market.

question

Most African nations have their main trade relationships:

answer

with developed nations, often built on former colonial ties

question

ASEAN began as a defensive alliance of 10 Asian nations concerned about:

answer

the spread of communism in their region.

question

NAFTA maintains restrictions on the movement of labor, a limitation that suggests it is:

answer

a free trade area.

question

The EU began as a common market for:

answer

the coal and steel industries.

question

. The Treaty of Rome, signed in 1957, established a common market for coal and steel for:

answer

West Germany, Belgium, the Netherlands, France, Luxembourg, and Italy.

question

The EMU (European Monetary Union or Economic and Monetary Union) has established the euro, a currency that is used in:

answer

16 of the EU member-countries.

question

The Council of European Union, the primary policy-setting institution of the EU, is composed of:

answer

the member-states' ministers who represent the specific area being discussed.

question

The impact of the EU on the WTO could be said to be negative, since:

answer

.the favored trade relationships among EU members are not extended to nonmember countries, so the EU undercuts the WTO.

question

The EU's impact on international business is:

answer

. substantial, since EU standards, especially in the areas of ecology and sustainability, impact any firm that wants to do business in the EU.

question

Under new institutional theory, institutions can be categorized as formal and informal, and the informal institutions can be further categorized as:

answer

normative and cognitive.

question

This type of institution operates through laws and regulations, with coercion as the regulative mechanism.

answer

. formal

question

Informal institutions are composed of sets of

answer

voluntary agreements.

question

The Chinese concept of guanxi is an example of:

answer

an informal, cognitive institution.

question

. The United Nations is probably the best known among:

answer

international organizations.

question

All UN member-countries belong to the UN's:

answer

General Assembly.

question

The UN's International Court of Justice (ICJ) is also known as:

answer

the World Court.

question

At the end of World War II, the UN called for the conference that set up the World Bank and the IMF. This conference was:

answer

held at Bretton Woods, New Hampshire.

question

That the common interest of all nations in a workable international exchange rate system transcends their conflicting international interests is the premise of:

answer

. the International Monetary Fund (IMF).

question

The World Bank's two major institutions are the International Development Association and the:

answer

. International Bank for Reconstruction and Development (IBRD).

question

The geographical area that receives the most International Development Association (IDA) credits and grants is:

answer

. Africa.

question

. IDA's purpose is to loan to:

answer

the poorest nations.

question

The purpose of the International Financial Corporation (IFC) is to invest in companies and financial institutions in developing countries in order to build:

answer

domestic capital markets.

question

The WTO is the only international organization designed to establish and help implement:

answer

. rules of trade among nations.

question

The first principle of the WTO's five basic principles is trade without:

answer

. discrimination.

question

The idea that WTO members treat all members equally is known as:

answer

the MFN (most-favored-nation) principle.

question

The Doha Development Agenda is:

answer

a WTO conference on trade.

question

The results of liberalized trade so far have been:

answer

uneven for developing and developed economies.

question

The main difference between a free trade area (FTA) and a customs union is that in a customs union, there is:

answer

a common external tariff.

question

ASEAN began as a:

answer

security and military alliance among Southeast Asian nations.

question

The Organization for Economic Cooperation and Development provides information on:

answer

. economic and other activities within its member-nations.

question

The following country is not a member of ASEAN:

answer

China.

question

How many countries in the EU use the euro as their currency?

answer

17

question

"Trade without discrimination" in the WTO means that

answer

all trading partners must be treated the same

question

The UN is important to international business for many reasons, including that it:

answer

develops standards and norms in technical areas.

question

International institutions are important to international business managers because, in general, they:

answer

. limit choices, thereby providing ways to settle disagreements and resolve conflicts.

question

International institutions offer graduating international business majors:

answer

interesting career development and internship opportunities.

question

EU rulings:

answer

affect all businesses within the EU and those that trade within the EU.

question

The OECD is called the "rich man's club" because its members:

answer

. are 34 of the world's wealthiest nations.

question

The main purpose of the OECD is to:

answer

provide economic research and a discussion forum.

question

The OECD has encouraged members to:

answer

eliminate bribery in all commercial transactions.

question

Two good places to begin country-level research are the websites of the:

answer

specific country's government and OECD.

question

Which country does not belong to the OECD?

answer

China

question

The most serious recent challenge to the EU has been:

answer

. the recent financial crisis.

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