Question 1

An unfavorable trade balance is called a(n)

Accepted Answer

A)  balance of trade. 
B)  trade deficit. 
C)  currency devaluation. 
D)  balance of payments. 
E)  import balance. 
A)  balance of trade. 
B)  trade deficit. 
C)  currency devaluation. 
D)  balance of payments. 
E)  import balance.

Question 2

Taiwanese manufacturers are dumping toys in Germany. What will happen to German toy manufacturers if the German government allows this dumping to continue?

Accepted Answer

A)  They will be faced with the highest demand ever. 
B)  They will become more competitive. 
C)  They will be put out of business because they cannot compete with the prices. 
D)  They will try to dump their toys in other countries. 
E)  Their revenues will decrease, but their long-term success will not be affected. 
A)  They will be faced with the highest demand ever. 
B)  They will become more competitive. 
C)  They will be put out of business because they cannot compete with the prices. 
D)  They will try to dump their toys in other countries. 
E)  Their revenues will decrease, but their long-term success will not be affected.

Question 3

Why is foreign economic growth important to the export success of U.S. companies?

Accepted Answer

Foreign economic growth is important to

Question 4

The IDB and ADB are examples of

Accepted Answer

A)  countertrade. 
B)  foreign banks. 
C)  economic communities. 
D)  world trade organizations. 
E)  multilateral development banks. 
A)  countertrade. 
B)  foreign banks. 
C)  economic communities. 
D)  world trade organizations. 
E)  multilateral development banks.

Question 5

Totally owned facilities overseas are an example of

Accepted Answer

A)  indirect investment. 
B)  direct investment. 
C)  roundabout investment. 
D)  licensing. 
E)  joint venture. 
A)  indirect investment. 
B)  direct investment. 
C)  roundabout investment. 
D)  licensing. 
E)  joint venture.

Question 6

Which of the following best describes the Organization of Petroleum Exploring Countries?

Accepted Answer

A)  Collective bargaining unit 
B)  Monopoly 
C)  Trading company 
D)  Joint venture 
E)  Strategic alliance 
A)  Collective bargaining unit 
B)  Monopoly 
C)  Trading company 
D)  Joint venture 
E)  Strategic alliance

Question 7

Howard believes that there should be no trade restrictions for any reason. What effect would Howard say that trade restrictions have on prices?

Accepted Answer

A)  He would argue that by encouraging competition with trade restrictions, prices are likely to decrease. 
B)  He would argue that restrictions would cause greater competition and therefore lead to higher prices. 
C)  He would say that trade restrictions have no impact on prices, but they do restrict consumers' choices. 
D)  He would say that restrictions reduce competition and therefore cause an increase in prices. 
E)  He would argue that trade restrictions increase prices because they break up domestic monopolies. 
A)  He would argue that by encouraging competition with trade restrictions, prices are likely to decrease. 
B)  He would argue that restrictions would cause greater competition and therefore lead to higher prices. 
C)  He would say that trade restrictions have no impact on prices, but they do restrict consumers' choices. 
D)  He would say that restrictions reduce competition and therefore cause an increase in prices. 
E)  He would argue that trade restrictions increase prices because they break up domestic monopolies.

Question 8

Strategic alliances and ____ are very similar.

Accepted Answer

A)  trading companies 
B)  most-favored-nation status 
C)  licensing agreements 
D)  joint ventures 
E)  corporate mergers 
A)  trading companies 
B)  most-favored-nation status 
C)  licensing agreements 
D)  joint ventures 
E)  corporate mergers

Question 9

The Ex-Im Bank finances the exports of American firms in all of the following ways except

Accepted Answer

A)  financing plant construction in overseas countries. 
B)  extending and guaranteeing credit to overseas buyers of American goods and services. 
C)  guaranteeing short-term financing for exports. 
D)  cooperating with commercial banks. 
E)  helping exporters offer credit to overseas customers. 
A)  financing plant construction in overseas countries. 
B)  extending and guaranteeing credit to overseas buyers of American goods and services. 
C)  guaranteeing short-term financing for exports. 
D)  cooperating with commercial banks. 
E)  helping exporters offer credit to overseas customers.

Question 10

Suppose Brazil, Argentina, Columbia, Peru, and Chile decide to form the South American Union to increase trade among these nations. This would be an example of a(n)

Accepted Answer

A)  world trade organization. 
B)  peace agreement. 
C)  economic community. 
D)  free trade agreement. 
E)  global marketplace. 
A)  world trade organization. 
B)  peace agreement. 
C)  economic community. 
D)  free trade agreement. 
E)  global marketplace.

Question 11

____ is the exportation of large quantities of a product at a price lower than that of the same product in the home market.

Accepted Answer

A)  Embargo 
B)  Duty 
C)  Dumping 
D)  Export quota 
E)  Dropping 
A)  Embargo 
B)  Duty 
C)  Dumping 
D)  Export quota 
E)  Dropping

Question 12

Because it controls the world's diamond deposits, the DeBeers Consolidated Mines, Ltd., has a(n)

Accepted Answer

A)  absolute advantage. 
B)  comparative advantage. 
C)  advantage based on efficient production. 
D)  trade deficit. 
E)  lot of diamonds. 
A)  absolute advantage. 
B)  comparative advantage. 
C)  advantage based on efficient production. 
D)  trade deficit. 
E)  lot of diamonds.

Question 13

Ford Motor Company, Mazda Motor Corporation, and Matsushita Electrical Industrial Company formed a ____ to make heating and cooling units in Japan for Mazda cars beginning in 1988. The new company's heating and cooling units may also be used in Ford's cars.

Accepted Answer

A)  sales branch 
B)  joint venture 
C)  subsidiary 
D)  licensing agreement 
E)  sole proprietorship 
A)  sales branch 
B)  joint venture 
C)  subsidiary 
D)  licensing agreement 
E)  sole proprietorship

Question 14

Who are the top two export partners of the United States?

Accepted Answer

A)  Japan and China 
B)  Canada and the United Kingdom 
C)  Mexico and Canada 
D)  Mexico and China 
E)  The United Kingdom and Japan 
A)  Japan and China 
B)  Canada and the United Kingdom 
C)  Mexico and Canada 
D)  Mexico and China 
E)  The United Kingdom and Japan

Question 15

When the United States levies a tax on textiles from India, this tax is a type of

Accepted Answer

A)  export duty. 
B)  barter. 
C)  import. 
D)  tariff. 
E)  responsibility. 
A)  export duty. 
B)  barter. 
C)  import. 
D)  tariff. 
E)  responsibility.

Question 16

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 17

Who are the two largest contributors to the Asian Development Bank?

Accepted Answer

A)  China and Japan 
B)  Japan and India 
C)  The United States and Japan 
D)  Russia and China 
E)  China and Indonesia 
A)  China and Japan 
B)  Japan and India 
C)  The United States and Japan 
D)  Russia and China 
E)  China and Indonesia

Question 18

What is dumping? Why do domestic manufacturers obtain antidumping duty through the government?

Accepted Answer

Dumping is a term used in international

Question 19

Which bank was established in 1990 to encourage reconstruction and development in the eastern and central European countries?

Accepted Answer

A)  The Ex-Im Bank 
B)  The Bank of America 
C)  The European Bank for Reconstruction and Development 
D)  The Inter-American Development Bank 
E)  The International Monetary Fund 
A)  The Ex-Im Bank 
B)  The Bank of America 
C)  The European Bank for Reconstruction and Development 
D)  The Inter-American Development Bank 
E)  The International Monetary Fund

Question 20

A complete halt to trading with a particular nation or in a particular product is called a(n)

Accepted Answer

A)  embargo. 
B)  stoppage. 
C)  stay. 
D)  closure. 
E)  barricade. 
A)  embargo. 
B)  stoppage. 
C)  stay. 
D)  closure. 
E)  barricade.

Exam 3: A: Exploring Global Business

An unfavorable trade balance is called a(n)

Taiwanese manufacturers are dumping toys in Germany. What will happen to German toy manufacturers if the German government allows this dumping to continue?

Why is foreign economic growth important to the export success of U.S. companies?

The IDB and ADB are examples of

Totally owned facilities overseas are an example of

Which of the following best describes the Organization of Petroleum Exploring Countries?

Howard believes that there should be no trade restrictions for any reason. What effect would Howard say that trade restrictions have on prices?

Strategic alliances and ____ are very similar.

The Ex-Im Bank finances the exports of American firms in all of the following ways except

Suppose Brazil, Argentina, Columbia, Peru, and Chile decide to form the South American Union to increase trade among these nations. This would be an example of a(n)

____ is the exportation of large quantities of a product at a price lower than that of the same product in the home market.

Because it controls the world's diamond deposits, the DeBeers Consolidated Mines, Ltd., has a(n)

Ford Motor Company, Mazda Motor Corporation, and Matsushita Electrical Industrial Company formed a ____ to make heating and cooling units in Japan for Mazda cars beginning in 1988. The new company's heating and cooling units may also be used in Ford's cars.

Who are the top two export partners of the United States?

When the United States levies a tax on textiles from India, this tax is a type of

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

Who are the two largest contributors to the Asian Development Bank?

What is dumping? Why do domestic manufacturers obtain antidumping duty through the government?

Which bank was established in 1990 to encourage reconstruction and development in the eastern and central European countries?

A complete halt to trading with a particular nation or in a particular product is called a(n)

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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