Exam 3: Business in a Global Environment

Generally speaking, nations don't exploit production and trade advantages because they prefer to protect their international images.

SCENARIO-BASED Cajun Chicken, a growing franchise chain based in Lafayette, Louisiana, has expanded to 185 locations in the United States. Because they realize that domestic growth is limited, the owners are contemplating expansion to selected foreign countries. Thus far, research has shown that the rights to use many of the firm’s recipes can be sold to other restaurants, cafeterias, and food stores. Cajun can also sell prepackaged food products, complete with spices, to other markets. At this point, whether to start by opening company-owned outlets or selling franchises is still a toss up. In any case, the long-term picture looks good. -In granting franchise rights, Cajun would be the _____ and the buyer would be the _____.

All of the following pieces of advice are significant to someone preparing for a career in international business except:

Compare and contrast absolute advantage and comparative advantage.

Why do multinational companies practice decentralization

You are a U.S. importer of goods from Switzerland. You owe your supplier 1,000 Swiss Francs for goods recently purchased. You had a choice for paying for the goods the day you purchased them or paying for them 30 days later. On the day the goods were purchased the exchange rate was 1 Swiss franc = $0.78 (one franc costs $0.78 cents). Thirty days later, the exchange rate is 1 Swiss franc = $0.87 (one franc costs $0.87). You waited the 30 days to pay the bill. Which of the following statements is true

Explain the difference between importing and exporting.

The United States is currently experiencing an international trade _____.

_____ has become a popular location for software development and customer-call centers for American companies.

All of the following are common criticisms of MNCs (multinational corporations) except:

The United States currently enjoys an international trade equilibrium.

Under a franchising agreement between a U.S.based company and a foreign firm, in return for the rights to use its brand name and sell its products, the U. S. franchiser requires the foreign company to adhere to an established business model.

High domestic ____ costs have made international contract manufacturing, or outsourcing, attractive to many U.S. companies.

Companies doing international business often face a smorgasbord of inconsistent laws and regulations.

If a country wants to offset the dumping of foreign goods on its soil, its most effective tactic will be imposing quotas on those goods.

The difference between a country's total outflows and inflows of money over a period of time is its _____.

Japan's production and exporting expertise lies in the areas of _____.

If the U.S. dollar goes down relative to a foreign currency, foreign buyers pay more for American goods and services.

SCENARIO-BASED Yokahama Sports Equipment Ltd. is a successful manufacturer and distributor of sports equipment in the Far East, Australia, and Europe. Top management sees attractive opportunities in the U.S. market because of the stable economy and government. In addition, of course, Americans have disposable income to spend and are willing to buy imported goods. Yokahama executives realize, however, that entering the U.S. market can be difficult and that they’ll need a well-planned strategy. -If Yokahama turns to the WTO for the resolution of a dumping dispute, it runs the risk of the offended nation being authorized to set up its own trade barriers.

With a troubled economy and the prospect of devastating economic times ahead, the Central European country of Westphalia should look to _____ for a major loan.