Question 1

U.S. exports to developing and newly industrialized countries

Accepted Answer

A)  have remained stable. 
B)  have declined in recent years. 
C)  are on the rise. 
D)  are prohibited by the U.S. government. 
E)  are scheduled to begin in 2009. 
A)  have remained stable. 
B)  have declined in recent years. 
C)  are on the rise. 
D)  are prohibited by the U.S. government. 
E)  are scheduled to begin in 2009.

Question 2

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 country's

Accepted Answer

A)  trade deficit. 
B)  balance of payments. 
C)  unfavorable balance. 
D)  balance of trade. 
E)  favorable balance. 
A)  trade deficit. 
B)  balance of payments. 
C)  unfavorable balance. 
D)  balance of trade. 
E)  favorable balance.

Question 3

If a small country wants to buy aircraft from the United States and the United States wants to export its aircraft, the United States may work through ____ in removing preset trade barriers so that the small country can more easily purchase the aircraft.

Accepted Answer

A)  GATT 
B)  IMF 
C)  WTO 
D)  EU 
E)  MDB 
A)  GATT 
B)  IMF 
C)  WTO 
D)  EU 
E)  MDB

Question 4

What does it mean for a country to have an absolute advantage? Compare that to having a comparative advantage.

Accepted Answer

When a country has an absolute advantage

Question 5

The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)

Accepted Answer

A)  import duty. 
B)  foreign exchange control. 
C)  import quota. 
D)  embargo. 
E)  export duty. 
A)  import duty. 
B)  foreign exchange control. 
C)  import quota. 
D)  embargo. 
E)  export duty.

Question 6

An international organization formed at the end of World War II by the United States and twenty-two other countries whose goal was to reduce or eliminate tariffs and other barriers to world trade is called the

Accepted Answer

A)  Trade Expansion Act. 
B)  Kennedy Round. 
C)  GATT. 
D)  Tokyo Round. 
E)  Common Market. 
A)  Trade Expansion Act. 
B)  Kennedy Round. 
C)  GATT. 
D)  Tokyo Round. 
E)  Common Market.

Question 7

Lynn Bernerd, Inc.
Lynn Bernerd, Inc., manufactures and sells reclining furniture. The company currently operates in the United States but wishes to expand overseas. The company managers have been contemplating the best way to enter the foreign market. At first, the management felt it would be in the company's best interest to let a foreign company use its product and brand in exchange for a royalty. The managers recognized, however, that before the company decided on its foreign strategy it needed to think through all the steps required to enter an international market. As such, the managers believed they needed to consult with some type of agency to help their firm compete more effectively in the global marketplace.
After all the research was completed, the senior managers realized that they wanted to export their product. The managers decided that the transport carrier would notify them when the merchandise was shipped. This would avoid any confusion about lost shipments and ensure better communication with the receiving parties.
-Refer to Lynn Bernerd, Inc. When the transport carriers notify the exporter that the product has been shipped, they use a

Accepted Answer

A)  bill of lading. 
B)  receipt. 
C)  letter of credit. 
D)  draft. 
E)  shipping verification. 
A)  bill of lading. 
B)  receipt. 
C)  letter of credit. 
D)  draft. 
E)  shipping verification.

Question 8

Which of the following best compares licensing and exporting as tools for entering foreign markets?

Accepted Answer

A)  Licensing and exporting are both low-risk methods, but licensing is not as simple as exporting. 
B)  Licensing is riskier and more complicated than exporting. 
C)  Exporting is much riskier and more complicated than licensing. 
D)  Licensing and exporting are both low-risk, but exporting is more complicated. 
E)  Licensing and exporting are both complicated and expensive methods. 
A)  Licensing and exporting are both low-risk methods, but licensing is not as simple as exporting. 
B)  Licensing is riskier and more complicated than exporting. 
C)  Exporting is much riskier and more complicated than licensing. 
D)  Licensing and exporting are both low-risk, but exporting is more complicated. 
E)  Licensing and exporting are both complicated and expensive methods.

Question 9

Landing Service
Landing Service is a lawn furniture company that has been around for many years. It is known for its ability to produce furniture more efficiently than any other company in the nation. In truth, no other companies in any other nation come close. Landing Service has shipped many of its products internationally. In fact, 80 percent of its profits come from international sales. However, the Italian government has imposed a tax on imported furniture items to protect local companies. The Brazilian government, on the other hand, has imposed taxes on Landing Service products due to the government wanting a piece of the pie.
Landing Service initially thought that these taxes were unfair because it was being singled out. However, after Landing Service contacted the organization that had the power to mediate this situation, the furniture company realized that the taxation it was subjected to was legal and that there was nothing it could do about it.
-Refer to Landing Service. Landing Service must have contacted which of these organizations to mediate regarding unfair treatment by foreign governments?

Accepted Answer

A)  MDB 
B)  GATT 
C)  WTO 
D)  EU 
E)  OPEC 
A)  MDB 
B)  GATT 
C)  WTO 
D)  EU 
E)  OPEC

Question 10

A ____ is issued by a bank upon request of an importer stating that the bank will pay an amount of money to a stated beneficiary.

Accepted Answer

A)  license 
B)  letter of credit 
C)  bill of lading 
D)  draft 
E)  voucher 
A)  license 
B)  letter of credit 
C)  bill of lading 
D)  draft 
E)  voucher

Question 11

Which two countries are considered the United States' best partners for our exports?

Accepted Answer

A)  Mexico and China 
B)  China and Canada 
C)  Canada and Germany 
D)  Canada and Mexico 
E)  Canada and Japan 
A)  Mexico and China 
B)  China and Canada 
C)  Canada and Germany 
D)  Canada and Mexico 
E)  Canada and Japan

Question 12

What is an embargo? When might it be used?

Accepted Answer

An embargo is a government-imposed restr

Question 13

If the Korean government charged tariffs on Japanese automobiles and in turn the Japanese government put tariffs on Korean automobiles, Japan's major rationale for imposing these tariffs would be to

Accepted Answer

A)  protect national security. 
B)  protect domestic jobs. 
C)  retaliate for Korea's tariffs. 
D)  lower prices for consumers. 
E)  protect an infant industry. 
A)  protect national security. 
B)  protect domestic jobs. 
C)  retaliate for Korea's tariffs. 
D)  lower prices for consumers. 
E)  protect an infant industry.

Question 14

All of the following are ways to export a product to a foreign market except

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)  establishing a U.S. sales office. 
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)  establishing a U.S. sales office.

Question 15

Selling and shipping raw materials or products to other nations is called

Accepted Answer

A)  exporting. 
B)  alien trading. 
C)  importing. 
D)  tariffing. 
E)  deficit trading. 
A)  exporting. 
B)  alien trading. 
C)  importing. 
D)  tariffing. 
E)  deficit trading.

Question 16

What are some advantages of licensing as a method of entering international business?

Accepted Answer

Licensing can be a beneficial method for

Question 17

When chain of organic coffee shops in Portland purchases coffee from Colombia, it

Accepted Answer

A)  is importing the coffee. 
B)  is exporting the coffee. 
C)  has an absolute advantage. 
D)  is decreasing the balance-of-trade deficit. 
E)  is making a big mistake. 
A)  is importing the coffee. 
B)  is exporting the coffee. 
C)  has an absolute advantage. 
D)  is decreasing the balance-of-trade deficit. 
E)  is making a big mistake.

Question 18

A new country is formed in central Africa. It has no absolute advantage in crude oil, diamonds, or wool. However, it does manufacture high-quality bows and arrows for specialized safari adventures. Which of the following statement is true?

Accepted Answer

A)  The new country should try to produce its own crude oil, diamonds, and wool. 
B)  The new country has a comparative advantage in the production of bows and arrows. 
C)  The new country has an unqualified advantage in the production of bows and arrows. 
D)  The new country has a determined advantage in the production of arrows. 
E)  The new country is engaged in dumping bows and arrows. 
A)  The new country should try to produce its own crude oil, diamonds, and wool. 
B)  The new country has a comparative advantage in the production of bows and arrows. 
C)  The new country has an unqualified advantage in the production of bows and arrows. 
D)  The new country has a determined advantage in the production of arrows. 
E)  The new country is engaged in dumping bows and arrows.

Question 19

What types of products did GATT focus on during the Kennedy Round?

Accepted Answer

A)  Business services and textiles 
B)  Agricultural products and textiles 
C)  Industrial products and business services 
D)  Industrial and agricultural products 
E)  Textiles and intellectual property rights 
A)  Business services and textiles 
B)  Agricultural products and textiles 
C)  Industrial products and business services 
D)  Industrial and agricultural products 
E)  Textiles and intellectual property rights

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.

Exam 3: A: Exploring Global Business

U.S. exports to developing and newly industrialized countries

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 country's

If a small country wants to buy aircraft from the United States and the United States wants to export its aircraft, the United States may work through ____ in removing preset trade barriers so that the small country can more easily purchase the aircraft.

What does it mean for a country to have an absolute advantage? Compare that to having a comparative advantage.

The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)

An international organization formed at the end of World War II by the United States and twenty-two other countries whose goal was to reduce or eliminate tariffs and other barriers to world trade is called the

Which of the following best compares licensing and exporting as tools for entering foreign markets?

A ____ is issued by a bank upon request of an importer stating that the bank will pay an amount of money to a stated beneficiary.

Which two countries are considered the United States' best partners for our exports?

What is an embargo? When might it be used?

If the Korean government charged tariffs on Japanese automobiles and in turn the Japanese government put tariffs on Korean automobiles, Japan's major rationale for imposing these tariffs would be to

All of the following are ways to export a product to a foreign market except

Selling and shipping raw materials or products to other nations is called

What are some advantages of licensing as a method of entering international business?

When chain of organic coffee shops in Portland purchases coffee from Colombia, it

A new country is formed in central Africa. It has no absolute advantage in crude oil, diamonds, or wool. However, it does manufacture high-quality bows and arrows for specialized safari adventures. Which of the following statement is true?

What types of products did GATT focus on during the Kennedy Round?

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

Exploring the World of Business and Economics

A: Being Ethical and Socially Responsible

B: Being Ethical and Socially Responsible

B: Exploring Global Business

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

Enhancing Union-Management Relations

Building Customer Relationships Through Effective Marketing

A: Creating and Pricing Products That Satisfy Customers

B: Creating and Pricing Products That Satisfy Customers

Wholesaling, Retailing, and Physical Distribution

Developing Integrated Marketing Communications

Social Media, E-Business, and Accounting

Using Management and Accounting Information

Understanding Money, Banking, and Credit

Mastering Financial Management

A: Understanding Personal Finances and Investments

B: Understanding Personal Finances and Investments

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