Question 1

If the Mexican peso (MXN)to Brazilian real (BRL)exchange rate goes from 5.9 MXN/BRL to 7.2 MXN/BRL

Accepted Answer

A)  Brazilians decrease their demand for Mexican goods. 
B)  Brazilians increase their demand for Mexican goods. 
C)  Mexicans increase their demand for Brazilian goods. 
D)  Not enough information to determine what happens. 
A)  Brazilians decrease their demand for Mexican goods. 
B)  Brazilians increase their demand for Mexican goods. 
C)  Mexicans increase their demand for Brazilian goods. 
D)  Not enough information to determine what happens.

Question 2

Which of the following is likely to decrease the exchange rate of Yen to euros (¥/€)?

Accepted Answer

A)  an increase in investment opportunities in the U.S. 
B)  a decrease in investment opportunities in the eurozone 
C)  an increase in demand for European goods in Japan 
D)  an increase in investment opportunities in the eurozone 
A)  an increase in investment opportunities in the U.S. 
B)  a decrease in investment opportunities in the eurozone 
C)  an increase in demand for European goods in Japan 
D)  an increase in investment opportunities in the eurozone

Question 3

Your U.S.-based company is doing business internationally,one way to mitigate exchange rate risk is to

Accepted Answer

A)  require payment in US$. 
B)  use a forward contract. 
C)  use a futures contract. 
D)  All of the above. 
A)  require payment in US$. 
B)  use a forward contract. 
C)  use a futures contract. 
D)  All of the above.

Question 4

-The above figure shows the market for rice in Japan.S₂ represents the domestic supply curve,and S₁ represents the world supply curve.If a $1 tariff is imposed on imported rice,the loss in social welfare is

Accepted Answer

A)  b + c + d + e. 
B)  a. 
C)  i. 
D)  a + c + d + e. 
A)  b + c + d + e. 
B)  a. 
C)  i. 
D)  a + c + d + e.

Question 5

When a country opens up to free trade

Accepted Answer

A)  winners and losers are created. 
B)  comparative advantage dictates that the country focus on production of some goods and services at the expense of others. 
C)  the gains outweigh the losses. 
D)  All of the above. 
A)  winners and losers are created. 
B)  comparative advantage dictates that the country focus on production of some goods and services at the expense of others. 
C)  the gains outweigh the losses. 
D)  All of the above.

Question 6

An exchange rate is

Accepted Answer

A)  the price of one currency in terms of another. 
B)  the monetary value of goods and services exchanged for imports. 
C)  the amount of gold a currency will buy. 
D)  All of the above. 
A)  the price of one currency in terms of another. 
B)  the monetary value of goods and services exchanged for imports. 
C)  the amount of gold a currency will buy. 
D)  All of the above.

Question 7

If a currency such as the US$ is traded in a competitive market,a(n)________ in demand for the US$ ________ the price of the US$ in terms of another currency such as the Yen (¥).

Accepted Answer

A)  increase; lowers 
B)  increase; raises 
C)  decrease; raises 
D)  change; lowers 
A)  increase; lowers 
B)  increase; raises 
C)  decrease; raises 
D)  change; lowers

Question 8

Your U.S.-based company is selling parts to a company in Bangladesh.If you require payment in US$

Accepted Answer

A)  the Bangladeshi company bears the exchange rate risk. 
B)  your company bears the exchange rate risk. 
C)  the companies share in the exchange rate risk. 
D)  there is no exchange rate risk. 
A)  the Bangladeshi company bears the exchange rate risk. 
B)  your company bears the exchange rate risk. 
C)  the companies share in the exchange rate risk. 
D)  there is no exchange rate risk.

Question 9

According to the principal of comparative advantage

Accepted Answer

A)  a country that produce goods at the lowest absolute cost will export those goods. 
B)  a country will import goods it can produce at the lowest relative cost. 
C)  a country will export goods it can produce at the lowest relative cost. 
D)  a country will only import those goods that it cannot produce for itself. 
A)  a country that produce goods at the lowest absolute cost will export those goods. 
B)  a country will import goods it can produce at the lowest relative cost. 
C)  a country will export goods it can produce at the lowest relative cost. 
D)  a country will only import those goods that it cannot produce for itself.

Question 10

Your U.S.-based company is selling parts to a company in Chile and the company will pay you 9.8 million pesos in 3 months.The current exchange rate is 490 pesos/US$.If the exchange rate at the time of payment is 510 pesos/US$

Accepted Answer

A)  you earn additional profit. 
B)  the Chilean company will end up paying more for the goods. 
C)  the Chilean company will end up paying less for the goods. 
D)  you earn less profit. 
A)  you earn additional profit. 
B)  the Chilean company will end up paying more for the goods. 
C)  the Chilean company will end up paying less for the goods. 
D)  you earn less profit.

Question 11

Creating market power through the use of tariffs or quotas can

Accepted Answer

A)  drive price to the monopoly level. 
B)  increase the world price of the good that is targeted. 
C)  increase government revenue. 
D)  All of the above. 
A)  drive price to the monopoly level. 
B)  increase the world price of the good that is targeted. 
C)  increase government revenue. 
D)  All of the above.

Question 12

A trade policy that protects domestic producers from certain actions taken by foreign governments or firms is

Accepted Answer

A)  illegal under WTO rules. 
B)  called a contingent protection policy. 
C)  considered a beggar-thy-neighbor policy. 
D)  intended to protect domestic consumers. 
A)  illegal under WTO rules. 
B)  called a contingent protection policy. 
C)  considered a beggar-thy-neighbor policy. 
D)  intended to protect domestic consumers.

If the Mexican peso (MXN)to Brazilian real (BRL)exchange rate goes from 5.9 MXN/BRL to 7.2 MXN/BRL

Which of the following is likely to decrease the exchange rate of Yen to euros (¥/€)?

Your U.S.-based company is doing business internationally,one way to mitigate exchange rate risk is to

-The above figure shows the market for rice in Japan.S₂ represents the domestic supply curve,and S₁ represents the world supply curve.If a $1 tariff is imposed on imported rice,the loss in social welfare is

When a country opens up to free trade

An exchange rate is

If a currency such as the US$ is traded in a competitive market,a(n) in demand for the US$ the price of the US$ in terms of another currency such as the Yen (¥).

Your U.S.-based company is selling parts to a company in Bangladesh.If you require payment in US$

According to the principal of comparative advantage

Your U.S.-based company is selling parts to a company in Chile and the company will pay you 9.8 million pesos in 3 months.The current exchange rate is 490 pesos/US$.If the exchange rate at the time of payment is 510 pesos/US$

Creating market power through the use of tariffs or quotas can

A trade policy that protects domestic producers from certain actions taken by foreign governments or firms is

Introduction

Supply and Demand

Empirical Methods for Demand Analysis

Consumer Choice

Production

Costs

Firm Organization and Market Structure

Competitive Firms and Markets

Monopoly

Pricing With Market Power

Oligopoly and Monopolistic Competition

Game Theory and Business Strategy

Strategies Over Time

Managerial Decision-Making Under Uncertainty

Asymmetric Information

Government and Business

Filters

Exam 17: Global Business

If the Mexican peso (MXN)to Brazilian real (BRL)exchange rate goes from 5.9 MXN/BRL to 7.2 MXN/BRL

Which of the following is likely to decrease the exchange rate of Yen to euros (¥/€)?

Your U.S.-based company is doing business internationally,one way to mitigate exchange rate risk is to

-The above figure shows the market for rice in Japan.S₂ represents the domestic supply curve,and S₁ represents the world supply curve.If a $1 tariff is imposed on imported rice,the loss in social welfare is

When a country opens up to free trade

An exchange rate is

If a currency such as the US$ is traded in a competitive market,a(n)________ in demand for the US$ ________ the price of the US$ in terms of another currency such as the Yen (¥).

Your U.S.-based company is selling parts to a company in Bangladesh.If you require payment in US$

According to the principal of comparative advantage

Your U.S.-based company is selling parts to a company in Chile and the company will pay you 9.8 million pesos in 3 months.The current exchange rate is 490 pesos/US$.If the exchange rate at the time of payment is 510 pesos/US$

Creating market power through the use of tariffs or quotas can

A trade policy that protects domestic producers from certain actions taken by foreign governments or firms is

Introduction

Supply and Demand

Empirical Methods for Demand Analysis

Consumer Choice

Production

Costs

Firm Organization and Market Structure

Competitive Firms and Markets

Monopoly

Pricing With Market Power

Oligopoly and Monopolistic Competition

Game Theory and Business Strategy

Strategies Over Time

Managerial Decision-Making Under Uncertainty

Asymmetric Information

Government and Business

Filters

If a currency such as the US$ is traded in a competitive market,a(n) in demand for the US$ the price of the US$ in terms of another currency such as the Yen (¥).