Exam 5: The Global Context of Business

Tariffs increase government revenue, discourage the sale of imported products, and raise prices for consumers.

What are the advantages of forming a strategic alliance?

When we talk about international trade, we are referring to trade in manufactured goods only.

In the World Economic Forum's 2012‒13 global competitiveness ranking, Canada ranked first. second. fourth. sixth. fourteenth.

Clement is the owner of Dills Distillery, which makes and bottles fruit wine. In his planning to export the wine, Clement should consider all of the following except the target country's balance of trade. demand for the wine. legal aspects of the target country. cultural aspects of the target country. economic road blocks.

A country has an absolute advantage in goods that it can produce more efficiently than most other countries.

Which of the following is not one of the goals of the WTO? To promote trade by encouraging members to adopt fair trade practices To promote multilateral negotiations regarding trade To reduce the amount of corruption in countries that score poorly on the Corruption Perceptions Index of Transparency International To establish fair procedures for resolving disputes among members To reduce trade barriers

Which of the following is correct regarding the barriers to international trade? Research clearly demonstrates that differences in culture are the most important barrier The two general categories where barriers exist are in command and market economies An embargo is an extreme form of a tariff Local content laws apply only to situations across international borders When Google agreed to pay $500 million to settle a case with the U.S. government over advertising revenue earned from Canadian online pharmacies, this was an example of business practice laws being violated

Local content laws cannot exist within a single country.

Other than the Canada‒U.S. Free Trade Agreement and NAFTA, identify some of the other free trade agreements in the Americas.

Sometimes foreign companies have many problems in complying with stringent and often changing regulations and bureaucratic obstacles known as business practice laws. cartels. dumping. local content laws. local practices.

An importer is a firm that makes products in one country and then distributes and sells them in other countries.

What is a tariff?

Identify some of the free trade agreements located outside of the Americas and the countries involved in them.

What are the four steps that firms should go through when deciding whether or not to go international?

Marketing a specific product to two or more countries is relatively easy since the same marketing strategy will usually work for both countries.

What is globalization?

The balance of payments refers to the relative difference between money flowing into and out of a country. the difference in value between a country's total exports and its total imports. the relative difference in value between a country's total exports and its total imports. the difference between money flowing into and out of a country as a result of trade and other transactions. the difference in exchange rates between two countries.

Derrido is an American firm that has produced several successful animated TV series in the United States. It is considering contracting with one or more international companies as a way to market its products overseas. Derrido's marketing director thinks that the company should craft a contractual agreement as an initial entry strategy, because the company might want to choose a more advanced entry strategy later. Which of the following, if true, would strengthen this position? Foreign partners usually want to enter into contractual agreements with American companies for a long-term period. A contractual agreement should spell out as many expectations of the foreign partner as possible. Contractual agreements should be entered into only if the foreign partner is extremely reliable. Contractual agreements require approval by legal specialists from all countries involved. Contractual agreements allow a company to provide for open, flexible terms of operation.

When Canada placed a tariff on barbecues made in China because of complaints that the Chinese government was subsidizing their manufacture, this was an example of a protectionist tariff.