Question 1

The benefits of protective tariffs are:

Accepted Answer

A)  they increase the revenues of the government that has implemented them.
B)  they decrease the cost of the product to the consumer end-user) .
C)  they help develop friendlier trade relations with loyal trading partners.Both parties are protected.
D)  they protect domestic jobs by encouraging cost sensitive consumers to purchase domestic products.E) A) and B)
F) B) and D)

Question 2

According to the theory of comparative advantage,a country should buy from other countries those goods it produces most efficiently.

Accepted Answer

A) True 
 B)False

Question 3

The World Trade Organization WTO)was established to mediate trade disputes among nations.

Accepted Answer

A) True 
 B)False

Question 4

A favorable balance of trade occurs when the value of a country's imports exceeds the value of its exports.

Accepted Answer

A) True 
 B)False

Question 5

Although embargos are enacted upon both imports and exports,this form of trade protectionism is often the result of:

Accepted Answer

A)  physical and environmental limitations on trade.
B)  non-tariff barriers.
C)  currency fluctuations.
D)  political disagreements between nations.E) A) and D)
F) All of the above

Question 6

The Spotlight on Small Business box titled "A Small Business with a Big Vision" is about:

Accepted Answer

A)  Making certain that entrepreneurial ventures in developing nations continue to seek a negative earnings financial position so that they can be designated a charity.
B)  Sharing revenues with workers in other nations.
C)  Creating value for workers and people in developing nations,while working toward a market-driven business model.
D)  Promoting reading by selling eyeglasses to people in developing nations.E) A) and B)
F) A) and C)

Question 7

U.S.firms that produce sophisticated military hardware are prohibited from exporting that equipment to "unfriendly" governments,such as Iran.This complete ban on exporting sensitive technology to specific countries is an example of an) :

Accepted Answer

A)  import quota.
B)  boycott.
C)  tariff.
D)  embargo.E) None of the above
F) A) and C)

Question 8

Telewhiz,Inc.just contracted with a firm in the Philippines to provide customer service for its cell phone customers.Although there were cheaper labor markets that Telewhiz could have tapped,customers have reported that they understand English speaking Filipino people better than English speaking people in other countries.As an outsourcing option,it is a good compromise.

Accepted Answer

A) True 
 B)False

Question 9

The common market arrangement that groups Brazil,Argentina,Paraguay,Uruguay,Chile,and Bolivia is called the:

Accepted Answer

A)  South American Six.
B)  World Trade Organization WTO) .
C)  Latin Free Trade Zone.
D)  Mercosur.E) B) and C)
F) A) and B)

Question 10

An important principle for firms desiring to export is:

Accepted Answer

A)  sell to countries with high standards of living.
B)  keep in mind that American methods are probably always best.
C)  find a need in the global market and fill it.
D)  if your product sells well in the U.S.it will sell well globally.E) A) and D)
F) None of the above

Question 11

Licensing is a popular strategy because:

Accepted Answer

A)  It boosts domestic market revenues.
B)  The licensee has incentive to work hard and succeed because he/she has borne the cost.
C)  Licensees spend little or no money to produce and market their products.
D)  There are seldom any long-term contractual requirements.E) B) and C)
F) None of the above

Question 12

Which of the following is an advantage of offshore outsourcing?

Accepted Answer

A)  Companies can create efficiencies by hiring low-wage employees.
B)  Wages increase in the home country.
C)  Product quality improves permitting firms to charge more for their products.
D)  Communication between the company and its customers improves.E) C) and D)
F) B) and D)

Question 13

With GDP totaling more than $570 billion,the common market known as COMESCA is:

Accepted Answer

A)  a subset of the Mercosur trading bloc.
B)  a subset of the European Union.
C)  composed of Southern African and Eastern African nations.
D)  composed of Ecuador,San Simeon,Chile,and Argentina.E) None of the above
F) A) and D)

Question 14

Adam's Apple Corporation ships all of the apples from its orchards in Washington to a single buyer in Japan.The firm's entire profits are derived from this international transaction.Adam's Apple Corporation:

Accepted Answer

A)  is an example of a multinational corporation.
B)  is not a multinational corporation.
C)  is contributing to the U.S.balance of trade deficit.
D)  will benefit greatly from the establishment of NAFTA.E) B) and D)
F) A) and C)

Question 15

Although it has experienced persistent social unrest,multinationals have shown interest in Russia due to:

Accepted Answer

A)  its cultural compatibility to the West.
B)  the consistent strength of its currency compared to U.S.and Japanese currencies.
C)  the size of its natural resources.
D)  its current abolishment of religious freedom.E) A) and C)
F) None of the above

Question 16

The objectives of the North American Free Trade Agreement NAFTA)include allowing free immigration between Canada,Mexico and the U.S.

Accepted Answer

A) True 
 B)False

Question 17

A firm may export everything it produces overseas and yet not be considered a multinational.

Accepted Answer

A) True 
 B)False

Question 18

A favorable balance of trade occurs when the value of a nation's exports exceeds its imports.

Accepted Answer

A) True 
 B)False

Question 19

When foreign firms build production facilities in the United States,they are engaging in:

Accepted Answer

A)  exporting.
B)  foreign direct investment.
C)  importing.
D)  countertrading.E) A) and C)
F) A) and D)

Question 20

One advantage of free trade is:

Accepted Answer

A)  jobs are shifted to low-wage global markets.
B)  service jobs are moved overseas.
C)  advanced production operations are built in low-wage countries.
D)  innovation for new products occurs which keeps firms competitively challenged.E) A) and D)
F) C) and D)

Exam 3: Doing Business in Global Markets

The common market arrangement that groups Brazil,Argentina,Paraguay,Uruguay,Chile,and Bolivia is called the:

Correct Answer
verified

With GDP totaling more than $570 billion,the common market known as COMESCA is:

Correct Answer
verified

An important principle for firms desiring to export is:

Correct Answer
verified

Although embargos are enacted upon both imports and exports,this form of trade protectionism is often the result of:

Correct Answer
verified

According to the theory of comparative advantage,a country should buy from other countries those goods it produces most efficiently.

Correct Answer
verified

Adam's Apple Corporation ships all of the apples from its orchards in Washington to a single buyer in Japan.The firm's entire profits are derived from this international transaction.Adam's Apple Corporation:

Correct Answer
verified

One advantage of free trade is:

Correct Answer
verified

The Spotlight on Small Business box titled "A Small Business with a Big Vision" is about:

Correct Answer
verified

The objectives of the North American Free Trade Agreement NAFTA)include allowing free immigration between Canada,Mexico and the U.S.

Correct Answer
verified

A favorable balance of trade occurs when the value of a nation's exports exceeds its imports.

Correct Answer
verified

Licensing is a popular strategy because:

Correct Answer
verified

A firm may export everything it produces overseas and yet not be considered a multinational.

Correct Answer
verified

Correct Answer
verified

The World Trade Organization WTO)was established to mediate trade disputes among nations.

Correct Answer
verified

The benefits of protective tariffs are:

Correct Answer
verified

A favorable balance of trade occurs when the value of a country's imports exceeds the value of its exports.

Correct Answer
verified

When foreign firms build production facilities in the United States,they are engaging in:

Correct Answer
verified

Although it has experienced persistent social unrest,multinationals have shown interest in Russia due to:

Correct Answer
verified

U.S.firms that produce sophisticated military hardware are prohibited from exporting that equipment to "unfriendly" governments,such as Iran.This complete ban on exporting sensitive technology to specific countries is an example of an) :

Correct Answer
verified

Which of the following is an advantage of offshore outsourcing?

Correct Answer
verified

Exam 3: Doing Business in Global Markets

The common market arrangement that groups Brazil,Argentina,Paraguay,Uruguay,Chile,and Bolivia is called the:

Correct AnswerverifiedShow Answer

With GDP totaling more than $570 billion,the common market known as COMESCA is:

Correct AnswerverifiedShow Answer

An important principle for firms desiring to export is:

Correct AnswerverifiedShow Answer

Although embargos are enacted upon both imports and exports,this form of trade protectionism is often the result of:

Correct AnswerverifiedShow Answer

According to the theory of comparative advantage,a country should buy from other countries those goods it produces most efficiently.

Correct AnswerverifiedShow Answer

Adam's Apple Corporation ships all of the apples from its orchards in Washington to a single buyer in Japan.The firm's entire profits are derived from this international transaction.Adam's Apple Corporation:

Correct AnswerverifiedShow Answer

One advantage of free trade is:

Correct AnswerverifiedShow Answer

The Spotlight on Small Business box titled "A Small Business with a Big Vision" is about:

Correct AnswerverifiedShow Answer

The objectives of the North American Free Trade Agreement NAFTA)include allowing free immigration between Canada,Mexico and the U.S.

Correct AnswerverifiedShow Answer

A favorable balance of trade occurs when the value of a nation's exports exceeds its imports.

Correct AnswerverifiedShow Answer

Licensing is a popular strategy because:

Correct AnswerverifiedShow Answer

A firm may export everything it produces overseas and yet not be considered a multinational.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The World Trade Organization WTO)was established to mediate trade disputes among nations.

Correct AnswerverifiedShow Answer

The benefits of protective tariffs are:

Correct AnswerverifiedShow Answer

A favorable balance of trade occurs when the value of a country's imports exceeds the value of its exports.

Correct AnswerverifiedShow Answer

When foreign firms build production facilities in the United States,they are engaging in:

Correct AnswerverifiedShow Answer

Although it has experienced persistent social unrest,multinationals have shown interest in Russia due to:

Correct AnswerverifiedShow Answer

U.S.firms that produce sophisticated military hardware are prohibited from exporting that equipment to "unfriendly" governments,such as Iran.This complete ban on exporting sensitive technology to specific countries is an example of an) :

Correct AnswerverifiedShow Answer

Which of the following is an advantage of offshore outsourcing?

Correct AnswerverifiedShow Answer

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