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Exam 3: Doing Business in Global Markets

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Question 161

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When a firm agrees to license its product,it gains notoriety but gives up all revenues.

A) True
B) False

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Question 162

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When trading in global markets,most countries prefer to import more than they export.

A) True
B) False

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Question 163

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Next year,in order to cut both time and cost in getting new styles to global markets,Rhett plans to _________________ a few lines.Rhett will send his designs to manufacturers in Saipan,Bangladesh,and Turkey who will produce the eyeglasses in facilities in their respective countries.This will not only reduce the cost of labor,it will help Rhett reach regional markets in a timely manner.

Yesterday,Frank was trying to use his new laptop features,with only a negligible amount of success.His warranty said that he had three months of free technical support,so he promptly called the tech support number.After several minutes,he finally got through to someone who spoke English the same language he speaks),but the dialect was still difficult to understand.He shook his head as he tried to listen carefully to every word the guy at the help desk provided,and thought to himself,"There are some pros and cons to outsourcing.I'm not certain the service is adding value for the customer."

Only large firms have the resources needed to successfully compete in the global environment.

__________ is the exchange of merchandise or services for other merchandise or services without the exchange of money.

In an effort to protect domestic jobs,some countries will place a limit on the number of certain types of products that can be imported.These limits are called:

Brett,a U.S.student,is preparing for a trip to Thailand in the near future.He read in the Wall Street Journal that the dollar has strength against the Thai Baht Thailand's currency) .Which of the following would be an exchange that would indicate this currency situation?

Compared to many other industrialized countries,the United States has historically exported a lower percentage of its products than other countries do.

Efficient currency exchange markets have eliminated countertrade in global business transactions.

The country of New Florentina requires that all imported beverages be contained in clear,well-labeled recyclable glass bottles.Several beverage producers refuse to trade with New Florentina because the cost of glass bottles cuts into their profits to the point where it just isn't worth it.New Florentina has created a nontariff barrier.

Japanese auto manufacturers,such as Toyota and Nissan,have invested billions of dollars in the United States by building new factories,warehouses,and offices.These investments increase "favorably" the balance of payments for the United States.

Sovereign wealth funds a form of foreign direct investment)are investment funds controlled by governments that hold large stakes in foreign companies.

You sell paint products and accessories for painters.Recently,you were in contact with merchants from India who have taken an interest in your products and are willing to talk more about entering into a contractual deal to purchase your goods.This opportunity may be just the thing to get your business over its slump,because you learned from your Introduction to Business class that very few barriers exist between U.S.and Indian markets.

Free trade results in a mutually beneficial exchange between and among nations.

An example of foreign direct investment would be Pepsi granting a Japanese firm the use of its formula and trademark,for a fee.

A fast-growing form of foreign direct investment is sovereign wealth funds SWFs) .Why do these investments by governments with surplus cash flows worry trade experts?

A trade deficit is the same as a favorable balance of trade.

Foreign direct investment refers to the buying of goods produced in another country.

U.S.exports boost the U.S.economy.