Exam 3: Doing Business in Global Markets

The theory of ________ states that a nation should produce and sell goods to other countries that it produces most efficiently, and buy goods from other nations that they produce more efficiently.

Ethnocentricity means

A devaluation of the U.S. dollar would make American goods cheaper to foreign buyers.

Many students in studying abroad programs at U.S. colleges and universities have discovered profitable opportunities by importing goods from their home countries into the United States.

An unfavorable balance of trade occurs when the value of

Last year, the island nation of Winstone imported goods totaling $300 million and exported products totaling $86 million. Tigerland experienced a(n)

The United States imports more products and services than any nation in the world.

________ is an arrangement whereby someone with a good idea for a business sells the rights to use the business name and sell the parent company's product or service to others in a given territory in a specified manner.

Technological differences can prevent some companies from successfully doing business abroad.

A complete ban on the import or export of a specific good is called an embargo.

Some governments initiate restrictive standards that detail exactly how a product must be sold in a country. Trade experts call these restrictions

________ are specialists that match buyers and sellers from different countries and provide services to ease the process of entering global markets.

The United States currently enjoys a favorable balance of trade with the rest of the world.

Fred Bergsten of the Institute for International Economics estimates that every $1 billion of U.S. exports

An exchange rate is the value of one nation's currency relative to the currencies of other nations.

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?

Which of the following statements is the most accurate observation regarding multinational corporations?

A specialized organization that assists businesses in creating relationships with foreign customers and suppliers is known as a(n)

Jessie has crafted a new technique for drying flowers that still keeps the vibrant color of fresh flowers. After unsuccessfully trying to sell the dried flowers at her shop, Flowers and Weeds, she discovered that although dried flowers are out of style in the U.S., these flower arrangements are still highly sought after in several nations abroad. It is difficult to preserve the ingredients that go into her formula for more than a month. She decides to partner with firms in Europe and Asia to make and sell her formula, but you suggest she license it to foreign companies and agree to royalties when they create the formula and sell it. Your advice makes better sense.

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