Question 1

The total flow of money into a country less the total flow of money out of the country over some period of time is called the nation's balance of trade.

Accepted Answer

A) True 
 B)False

Question 2

If Japan were regarded as the best electronics manufacturer in the world, what would be true?

Accepted Answer

A)  Japan would have a comparative advantage in electronics manufacturing. 
B)  Japan would have a positive balance of trade. 
C)  The United States would have a comparative advantage in electronics. 
D)  Japan would have an absolute advantage in electronics production. 
E)  Japan would have a trade deficit with the United States. 
A)  Japan would have a comparative advantage in electronics manufacturing. 
B)  Japan would have a positive balance of trade. 
C)  The United States would have a comparative advantage in electronics. 
D)  Japan would have an absolute advantage in electronics production. 
E)  Japan would have a trade deficit with the United States.

Question 3

Balance of payments is a much broader concept than balance of trade.

Accepted Answer

A) True 
 B)False

Question 4

If the Land of Mercury had total exports of $150 billion and total imports of $234 billion, it had a _____.

Accepted Answer

A)  comparative advantage 
B)  trade deficit 
C)  balance of payments 
D)  negative output 
E)  positive balance of trade 
A)  comparative advantage 
B)  trade deficit 
C)  balance of payments 
D)  negative output 
E)  positive balance of trade

Question 5

Suppose a set of English bone china costing 1,000 pounds costs $3,000 in the United States.After devaluation, the set of china costs $1,000.This change

Accepted Answer

A)  shows that to foreign purchasers, the price of the china is the same before and after the devaluation. 
B)  makes the china less attractive to foreigner purchasers. 
C)  makes the china more attractive to foreign purchasers. 
D)  is irrelevant to foreign purchasers. 
E)  proves that foreign purchasers would prefer devaluation of the English pound so that it would be worth $2.That way, they could get even more for their dollars. 
A)  shows that to foreign purchasers, the price of the china is the same before and after the devaluation. 
B)  makes the china less attractive to foreigner purchasers. 
C)  makes the china more attractive to foreign purchasers. 
D)  is irrelevant to foreign purchasers. 
E)  proves that foreign purchasers would prefer devaluation of the English pound so that it would be worth $2.That way, they could get even more for their dollars.

Question 6

Globalization represents a huge opportunity for

Accepted Answer

A)  all countries-rich or poor. 
B)  the United States. 
C)  Japan. 
D)  China. 
E)  Asia. 
A)  all countries-rich or poor. 
B)  the United States. 
C)  Japan. 
D)  China. 
E)  Asia.

Question 7

Which of the following is false concerning the International Monetary Fund?

Accepted Answer

A)  It has more than 150 member nations. 
B)  It makes short-term loans to developing countries. 
C)  Its loans are primarily to fund international trade. 
D)  Its loans to developing countries are interest free. 
E)  It is an international bank. 
A)  It has more than 150 member nations. 
B)  It makes short-term loans to developing countries. 
C)  Its loans are primarily to fund international trade. 
D)  Its loans to developing countries are interest free. 
E)  It is an international bank.

Question 8

A ____ is a partnership formed to achieve a specific goal or to operate for a specific period of time.

Accepted Answer

A)  trading company 
B)  strategic alliance 
C)  licensing company 
D)  countertrade agreement 
E)  joint venture 
A)  trading company 
B)  strategic alliance 
C)  licensing company 
D)  countertrade agreement 
E)  joint venture

Question 9

A tariff is a tax levied on a particular foreign product entering a country.

Accepted Answer

A) True 
 B)False

Question 10

Arguments for the government imposing restrictions on foreign trade include

Accepted Answer

A)  the loss of jobs in foreign countries. 
B)  advancing technology will harm the country's economy. 
C)  restriction of consumers' choices. 
D)  protection of the health of its citizens. 
E)  helping the foreign country become more competitive. 
A)  the loss of jobs in foreign countries. 
B)  advancing technology will harm the country's economy. 
C)  restriction of consumers' choices. 
D)  protection of the health of its citizens. 
E)  helping the foreign country become more competitive.

Question 11

A trading company provides a link between buyers and sellers in different countries.

Accepted Answer

A) True 
 B)False

Question 12

By definition, every country has a(n) ____ advantage in some product.

Accepted Answer

A)  relative 
B)  absolute 
C)  comparative 
D)  superior 
E)  inferior 
A)  relative 
B)  absolute 
C)  comparative 
D)  superior 
E)  inferior

Question 13

____ is an internationally supported bank that provides loans to developing countries to help them grow.

Accepted Answer

A)  A multilateral development bank 
B)  The Eximbank 
C)  An international bank 
D)  The Federal Reserve 
E)  The International Monetary Fund 
A)  A multilateral development bank 
B)  The Eximbank 
C)  An international bank 
D)  The Federal Reserve 
E)  The International Monetary Fund

Question 14

Licensing and exporting can be considered relatively low-risk methods of entering foreign markets.

Accepted Answer

A) True 
 B)False

Question 15

A limit on the amount of a particular good that may be imported into a country during a given period of time is called an import quota.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following are ways to export a product to a foreign market?

Accepted Answer

A)  using an export-import merchant 
B)  using an export-import agent 
C)  establishing a foreign sales office 
D)  establishing a foreign sales branch 
E)  All of the above are correct. 
A)  using an export-import merchant 
B)  using an export-import agent 
C)  establishing a foreign sales office 
D)  establishing a foreign sales branch 
E)  All of the above are correct.

Question 17

The Kingdom of Rhonda has no high tariffs, yet other countries find it difficult to trade with the Kingdom of Rhonda because of its requirements for labeling, product testing, and certification.These restrictions can best be classified as _____.

Accepted Answer

A)  embargos 
B)  currency devaluations 
C)  import quotas 
D)  quality import restrictions 
E)  bureaucratic red tape 
A)  embargos 
B)  currency devaluations 
C)  import quotas 
D)  quality import restrictions 
E)  bureaucratic red tape

Question 18

A letter of credit is issued in favor of the importer.

Accepted Answer

A) True 
 B)False

Question 19

Quotas may be set on worldwide imports or on imports from a specific country.

Accepted Answer

A) True 
 B)False

Question 20

Forming a joint venture with an existing foreign company offers all of the following advantages except

Accepted Answer

A)  joining an established firm. 
B)  requiring less commitment from all parties involved in the joint venture. 
C)  providing immediate marketing knowledge. 
D)  providing reduced risk. 
E)  providing control over product attributes. 
A)  joining an established firm. 
B)  requiring less commitment from all parties involved in the joint venture. 
C)  providing immediate marketing knowledge. 
D)  providing reduced risk. 
E)  providing control over product attributes.

The total flow of money into a country less the total flow of money out of the country over some period of time is called the nation's balance of trade.

If Japan were regarded as the best electronics manufacturer in the world, what would be true?

Balance of payments is a much broader concept than balance of trade.

If the Land of Mercury had total exports of $150 billion and total imports of $234 billion, it had a _____.

Suppose a set of English bone china costing 1,000 pounds costs $3,000 in the United States.After devaluation, the set of china costs $1,000.This change

Globalization represents a huge opportunity for

Which of the following is false concerning the International Monetary Fund?

A ____ is a partnership formed to achieve a specific goal or to operate for a specific period of time.

A tariff is a tax levied on a particular foreign product entering a country.

Arguments for the government imposing restrictions on foreign trade include

A trading company provides a link between buyers and sellers in different countries.

By definition, every country has a(n) ____ advantage in some product.

____ is an internationally supported bank that provides loans to developing countries to help them grow.

Licensing and exporting can be considered relatively low-risk methods of entering foreign markets.

A limit on the amount of a particular good that may be imported into a country during a given period of time is called an import quota.

Which of the following are ways to export a product to a foreign market?

The Kingdom of Rhonda has no high tariffs, yet other countries find it difficult to trade with the Kingdom of Rhonda because of its requirements for labeling, product testing, and certification.These restrictions can best be classified as _____.

A letter of credit is issued in favor of the importer.

Quotas may be set on worldwide imports or on imports from a specific country.

Forming a joint venture with an existing foreign company offers all of the following advantages except

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

Choosing a Form of Business Ownership

Small Business, Entrepreneurship, and Franchises

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Information and E-Business

Using Accounting Information

Mastering Financial Management

Filters

Exam 3: Exploring Global Business

The total flow of money into a country less the total flow of money out of the country over some period of time is called the nation's balance of trade.

If Japan were regarded as the best electronics manufacturer in the world, what would be true?

Balance of payments is a much broader concept than balance of trade.

If the Land of Mercury had total exports of $150 billion and total imports of $234 billion, it had a _____.

Suppose a set of English bone china costing 1,000 pounds costs $3,000 in the United States.After devaluation, the set of china costs $1,000.This change

Globalization represents a huge opportunity for

Which of the following is false concerning the International Monetary Fund?

A ____ is a partnership formed to achieve a specific goal or to operate for a specific period of time.

A tariff is a tax levied on a particular foreign product entering a country.

Arguments for the government imposing restrictions on foreign trade include

A trading company provides a link between buyers and sellers in different countries.

By definition, every country has a(n) ____ advantage in some product.

____ is an internationally supported bank that provides loans to developing countries to help them grow.

Licensing and exporting can be considered relatively low-risk methods of entering foreign markets.

A limit on the amount of a particular good that may be imported into a country during a given period of time is called an import quota.

Which of the following are ways to export a product to a foreign market?

The Kingdom of Rhonda has no high tariffs, yet other countries find it difficult to trade with the Kingdom of Rhonda because of its requirements for labeling, product testing, and certification.These restrictions can best be classified as _____.

A letter of credit is issued in favor of the importer.

Quotas may be set on worldwide imports or on imports from a specific country.

Forming a joint venture with an existing foreign company offers all of the following advantages except

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

Choosing a Form of Business Ownership

Small Business, Entrepreneurship, and Franchises

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Information and E-Business

Using Accounting Information

Mastering Financial Management

Filters