Question 1

____ is the ability to produce a specific product more efficiently than any other product.

Accepted Answer

A)  Absolute advantage 
B)  Specialization 
C)  Relative advantage 
D)  Dominant advantage 
E)  Comparative advantage 
A)  Absolute advantage 
B)  Specialization 
C)  Relative advantage 
D)  Dominant advantage 
E)  Comparative advantage

Question 2

From 1947 to 1994,GATT was unable to sponsor any round of negotiations to reduce trade restrictions.

Accepted Answer

A) True 
 B)False

Question 3

A newly formed country in the Caribbean has no high tariffs,yet other countries find it difficult to trade with the new country because of its requirements for labeling,product testing,and certifications.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 4

Countertrade is losing its importance in international trade.

Accepted Answer

A) True 
 B)False

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

A medium-sized hardware manufacturer wants to become deeply involved in exporting,but it does not yet wish to actually manufacture any of its products overseas.The company wants to maintain control over its sales while gaining experience in foreign markets.Which option would be best for this company?

Accepted Answer

A)  Licensing its products for sale in foreign countries 
B)  Selling its products outright to an export/import merchant 
C)  Establishing its own sales offices in foreign countries 
D)  Developing totally owned facilities in a foreign market 
E)  Hiring an export/import agent to assist with foreign sales 
A)  Licensing its products for sale in foreign countries 
B)  Selling its products outright to an export/import merchant 
C)  Establishing its own sales offices in foreign countries 
D)  Developing totally owned facilities in a foreign market 
E)  Hiring an export/import agent to assist with foreign sales

Question 7

If the United States and Japan can't settle their trade disputes on their own,they probably should settle them through the

Accepted Answer

A)  Tokyo Round. 
B)  Kennedy Round. 
C)  Uruguay Round. 
D)  WTO. 
E)  United Nations. 
A)  Tokyo Round. 
B)  Kennedy Round. 
C)  Uruguay Round. 
D)  WTO. 
E)  United Nations.

Question 8

An unfavorable balance of trade occurs when

Accepted Answer

A)  exports are greater than imports. 
B)  imports are greater than exports. 
C)  the total outflow of money is greater than the total inflow of money. 
D)  the total outflow of money is less than the total inflow of money. 
E)  exports equal imports. 
A)  exports are greater than imports. 
B)  imports are greater than exports. 
C)  the total outflow of money is greater than the total inflow of money. 
D)  the total outflow of money is less than the total inflow of money. 
E)  exports equal imports.

Question 9

China is selling school supplies in the United States for very low prices,even lower than the prevailing prices in China,and thus making it extremely difficult for American manufacturers to compete.This is referred to as

Accepted Answer

A)  exporting. 
B)  importing. 
C)  an embargo. 
D)  dropping. 
E)  dumping. 
A)  exporting. 
B)  importing. 
C)  an embargo. 
D)  dropping. 
E)  dumping.

Question 10

What is the General Agreement on Tariffs and Trade (GATT)? What is its primary objective?

Accepted Answer

The General Agreement on Tariffs and Tra

Question 11

Germany is experiencing balance-of-payment deficits and needs a short-term loan.It will most likely turn to _____ for the loan.

Accepted Answer

A)  ​the International Monetary Fund. 
B)  ​the European Bank for Reconstruction and Development. 
C)  ​the World Bank. 
D)  ​the Federal Reserve Bank. 
A)  ​the International Monetary Fund. 
B)  ​the European Bank for Reconstruction and Development. 
C)  ​the World Bank. 
D)  ​the Federal Reserve Bank.

Question 12

An important and practical issue for domestic firms dealing with foreign customers is securing payment.

Accepted Answer

A) True 
 B)False

Question 13

Foreign licensing is similar to

Accepted Answer

A)  starting from scratch. 
B)  franchising. 
C)  wholesaling. 
D)  establishing a subsidiary in another country. 
E)  establishing a sales office in a foreign country. 
A)  starting from scratch. 
B)  franchising. 
C)  wholesaling. 
D)  establishing a subsidiary in another country. 
E)  establishing a sales office in a foreign country.

Question 14

One example of an economic community is the organization started by France,Germany,Belgium,Italy,the Netherlands,and Luxembourg.This organization is known as the

Accepted Answer

A)  General Agreement on Tariffs and Trade. 
B)  European Economic Area. 
C)  European Free Trade Agreement. 
D)  European Union. 
E)  Euro Economic Alliance. 
A)  General Agreement on Tariffs and Trade. 
B)  European Economic Area. 
C)  European Free Trade Agreement. 
D)  European Union. 
E)  Euro Economic Alliance.

Question 15

Strategic alliances are partnerships formed to create competitive advantage on a worldwide basis.

Accepted Answer

A) True 
 B)False

Question 16

Arguments for imposing trade restrictions include

Accepted Answer

A)  the misallocation of international resources. 
B)  equalizing a nation's balance of payments. 
C)  higher prices for consumers. 
D)  restriction of consumers' choices. 
E)  none of these answer choices. 
A)  the misallocation of international resources. 
B)  equalizing a nation's balance of payments. 
C)  higher prices for consumers. 
D)  restriction of consumers' choices. 
E)  none of these answer choices.

Question 17

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 18

Gerrick has an international business but is having difficulty with currency exchanges and fluctuations in the currency exchange rates.At times the problems are so severe he has considered closing down his international operations and doing business exclusively in the United States.Where can he go for assistance with currency exchange problems?

Accepted Answer

A)  International Monetary Fund 
B)  His bank,if it is a large international bank 
C)  Export-Import Bank of the United States 
D)  A multilateral development bank 
A)  International Monetary Fund 
B)  His bank,if it is a large international bank 
C)  Export-Import Bank of the United States 
D)  A multilateral development bank

Question 19

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

Accepted Answer

A)  shows that to foreigner 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 foreigner 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 20

Because Saudi Arabia and Australia have ____,Saudi Arabia can specialize in the production of crude oil and petroleum products,and Australia can specialize in the production of wool.

Accepted Answer

A)  a company advantage 
B)  an absolute advantage 
C)  a comparative advantage 
D)  an effective manufacturing system 
E)  very low labor costs 
A)  a company advantage 
B)  an absolute advantage 
C)  a comparative advantage 
D)  an effective manufacturing system 
E)  very low labor costs

____ is the ability to produce a specific product more efficiently than any other product.

From 1947 to 1994,GATT was unable to sponsor any round of negotiations to reduce trade restrictions.

A newly formed country in the Caribbean has no high tariffs,yet other countries find it difficult to trade with the new country because of its requirements for labeling,product testing,and certifications.These restrictions can best be classified as

Countertrade is losing its importance in international trade.

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)

If the United States and Japan can't settle their trade disputes on their own,they probably should settle them through the

An unfavorable balance of trade occurs when

China is selling school supplies in the United States for very low prices,even lower than the prevailing prices in China,and thus making it extremely difficult for American manufacturers to compete.This is referred to as

What is the General Agreement on Tariffs and Trade (GATT)? What is its primary objective?

Germany is experiencing balance-of-payment deficits and needs a short-term loan.It will most likely turn to _____ for the loan.

An important and practical issue for domestic firms dealing with foreign customers is securing payment.

Foreign licensing is similar to

One example of an economic community is the organization started by France,Germany,Belgium,Italy,the Netherlands,and Luxembourg.This organization is known as the

Strategic alliances are partnerships formed to create competitive advantage on a worldwide basis.

Arguments for imposing trade restrictions include

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

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

Because Saudi Arabia and Australia have ____,Saudi Arabia can specialize in the production of crude oil and petroleum products,and Australia can specialize in the production of wool.

Exploring the World of Business and Economics

Ethics and Social Responsibility in 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

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Exploring Social Media and E-Business

Using Management and Accounting Information

Mastering Financial Management

Understanding Personal Finances and Investments

Enhancing Union-Management Relations

Risk Management and Insurance

Business Law regulation and Taxation

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Exam 3: Global Business

____ is the ability to produce a specific product more efficiently than any other product.

From 1947 to 1994,GATT was unable to sponsor any round of negotiations to reduce trade restrictions.

A newly formed country in the Caribbean has no high tariffs,yet other countries find it difficult to trade with the new country because of its requirements for labeling,product testing,and certifications.These restrictions can best be classified as

Countertrade is losing its importance in international trade.

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)

If the United States and Japan can't settle their trade disputes on their own,they probably should settle them through the

An unfavorable balance of trade occurs when

China is selling school supplies in the United States for very low prices,even lower than the prevailing prices in China,and thus making it extremely difficult for American manufacturers to compete.This is referred to as

What is the General Agreement on Tariffs and Trade (GATT)? What is its primary objective?

Germany is experiencing balance-of-payment deficits and needs a short-term loan.It will most likely turn to _____ for the loan.

An important and practical issue for domestic firms dealing with foreign customers is securing payment.

Foreign licensing is similar to

One example of an economic community is the organization started by France,Germany,Belgium,Italy,the Netherlands,and Luxembourg.This organization is known as the

Strategic alliances are partnerships formed to create competitive advantage on a worldwide basis.

Arguments for imposing trade restrictions include

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

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

Because Saudi Arabia and Australia have ____,Saudi Arabia can specialize in the production of crude oil and petroleum products,and Australia can specialize in the production of wool.

Exploring the World of Business and Economics

Ethics and Social Responsibility in 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

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Exploring Social Media and E-Business

Using Management and Accounting Information

Mastering Financial Management

Understanding Personal Finances and Investments

Enhancing Union-Management Relations

Risk Management and Insurance

Business Law regulation and Taxation

Filters