Exam 3: The World Marketplace: Business Without Borders

The United States has had an overall trade deficit since 1976, and as the American appetite for foreign goods has grown, the trade deficit has increased.

Businesses that are actively involved in foreign markets often discover leading­edge trends that can give them a jump on the competition in other markets around the world.

Countertrade is the:

With a given amount of labor and other resources, producers in the nation of Germany can produce either 100 SUVs or 50 sedans. Thus, two SUVs must be given up to produce each sedan. Using the same amount of labor and resources, producers in Japan can produce 40 SUVs or 40 sedans­so one SUV must be given up for each sedan produced. Based on this information, Japan has a comparative advantage in the production of sedans.

The United States's economy lags behind other highly­populated countries, because a lower population in the U.S. puts a drag on economic growth.

Quality control forms a key risk of exporting.

Due to the rising price of gasoline, Sharon is looking for a car with better gas mileage. She hopes to purchase the newest Ford Fiesta, an imported car with hybrid technology. However, Fiestas are hard to find because the government in Sharon's country has limited the number of Fiesta cars that can be imported each year. Sharon is witnessing the impact of a(n) _____ imposed by her country.

In the context of international trade, international companies must comply with international legal standards, but not necessarily with the laws of their host country.

The industries in most countries tend to produce products for which they have a(n) _____ when compared to other countries.

Quitor Inc., which is based in the U.S., has most of its major products manufactured by the Falconn Technology Group, which is based in Taiwan. This strategy by Quitor Inc. was taken to:

Which of the following would be an appropriate reason for a country to eliminate trade restrictions?

Explain how nations measure trade activities (exports vs. imports) in an effort to strengthen their economies.

In 2002, the U.S. steel industry lobbied the U.S. government to impose a tax on the importation of foreign­produced steel to make the foreign steel more expensive. The barrier to international trade in this scenario is a(n) _____.

The main disadvantage of foreign outsourcing is that:

The World Trade Organization and its policies have led to a general reduction of trade barriers since 1948.

Foreign _____ involves a foreign firm buying the rights to produce, promote, and use the domestic firm's trademark/patents in a defined geographical area.

The production of high­performance cars has the lowest opportunity cost in Germany. This means that Germany:

The three countries participating in the North American Free Trade Agreement (NAFTA) are:

The International Monetary Fund (IMF) implemented a debt relief program to benefit _____.

A joint venture with a less formal, less encompassing agreement is called a: