Question 1

Licensing and exporting can be considered relatively low-risk methods of entering foreign markets.

Accepted Answer

A) True 
 B)False

Question 2

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 3

If Germany exports $100,000 of sauerkraut to Jamaica and purchases $100,000 of Blue Mountain coffee beans from Jamaica, Germany has

Accepted Answer

A) an overall favorable balance of trade. 
B) an overall unfavorable balance of trade. 
C) a favorable balance of trade with Jamaica. 
D) neither a favorable nor an unfavorable balance of trade with Jamaica. 
E) an unfavorable balance of trade with Jamaica. 
A) an overall favorable balance of trade. 
B) an overall unfavorable balance of trade. 
C) a favorable balance of trade with Jamaica. 
D) neither a favorable nor an unfavorable balance of trade with Jamaica. 
E) an unfavorable balance of trade with Jamaica.

Question 4

____ 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 5

The best method of learning from experience in international business is to

Accepted Answer

A) enter into a licensing agreement. 
B) start exporting through an export merchant. 
C) start exporting through an export agent. 
D) invest directly in a foreign country. 
E) form a joint venture. 
A) enter into a licensing agreement. 
B) start exporting through an export merchant. 
C) start exporting through an export agent. 
D) invest directly in a foreign country. 
E) form a joint venture.

Question 6

Trade restrictions limit choices for consumers but have no effect on the prices charged for the products.

Accepted Answer

A) True 
 B)False

Question 7

Balance of payments is a much broader concept than balance of trade.

Accepted Answer

A) True 
 B)False

Question 8

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 9

The participants in the Kennedy Round have succeeded in reducing tariffs by less than 20 percent.

Accepted Answer

A) True 
 B)False

Question 10

Miller Beer allows a Canadian firm to use its name, formula, and brands in return for a royalty. This is known as

Accepted Answer

A) exporting. 
B) licensing. 
C) direct investment. 
D) manufacturing in foreign countries. 
E) none of the above. 
A) exporting. 
B) licensing. 
C) direct investment. 
D) manufacturing in foreign countries. 
E) none of the above.

Question 11

A ____ is issued by the exporter's bank, ordering the importer's bank to pay for the merchandise.

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 12

In 1967, several Asian countries banded together to reduce the trade barriers between them and encourage trading among themselves. This is known as

Accepted Answer

A) a GATT. 
B) the European Union. 
C) the Association of Southeast Asian Nations. 
D) a multinational. 
E) an orderly marketing agreement. 
A) a GATT. 
B) the European Union. 
C) the Association of Southeast Asian Nations. 
D) a multinational. 
E) an orderly marketing agreement.

Question 13

By definition, every country has a comparative advantage in some product.

Accepted Answer

A) True 
 B)False

Question 14

What does the International Monetary Fund (IMF) do for nations with an unfavorable balance of trade?

Accepted Answer

The International Monetary Fund (IMF) is

Question 15

The newest forms of international business structure developed to create competitive advantage on a worldwide basis are called

Accepted Answer

A) licensees. 
B) export agents. 
C) strategic alliances. 
D) trading companies. 
E) countertraders. 
A) licensees. 
B) export agents. 
C) strategic alliances. 
D) trading companies. 
E) countertraders.

Question 16

A letter of credit is issued in favor of the importer.

Accepted Answer

A) True 
 B)False

Question 17

Countertrade is an international barter transaction in which

Accepted Answer

A) goods and services are exchanged for different goods and services. 
B) one company sells goods and services under the counter. 
C) the buyers and sellers trade illegally. 
D) one company manufactures and the other company owns the assets. 
E) none of the above is correct. 
A) goods and services are exchanged for different goods and services. 
B) one company sells goods and services under the counter. 
C) the buyers and sellers trade illegally. 
D) one company manufactures and the other company owns the assets. 
E) none of the above is correct.

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

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 20

The payments portion of the balance of payments--that is, payments made by the United States--does not include

Accepted Answer

A) exports. 
B) imports. 
C) military spending. 
D) foreign aid. 
E) investments. 
A) exports. 
B) imports. 
C) military spending. 
D) foreign aid. 
E) investments.

Licensing and exporting can be considered relatively low-risk methods of entering foreign markets.

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

If Germany exports $100,000 of sauerkraut to Jamaica and purchases $100,000 of Blue Mountain coffee beans from Jamaica, Germany has

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

The best method of learning from experience in international business is to

Trade restrictions limit choices for consumers but have no effect on the prices charged for the products.

Balance of payments is a much broader concept than balance of trade.

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

The participants in the Kennedy Round have succeeded in reducing tariffs by less than 20 percent.

Miller Beer allows a Canadian firm to use its name, formula, and brands in return for a royalty. This is known as

A ____ is issued by the exporter's bank, ordering the importer's bank to pay for the merchandise.

In 1967, several Asian countries banded together to reduce the trade barriers between them and encourage trading among themselves. This is known as

By definition, every country has a comparative advantage in some product.

What does the International Monetary Fund (IMF) do for nations with an unfavorable balance of trade?

The newest forms of international business structure developed to create competitive advantage on a worldwide basis are called

A letter of credit is issued in favor of the importer.

Countertrade is an international barter transaction in which

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?

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.

The payments portion of the balance of payments--that is, payments made by the United States--does not include

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

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

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Social Media and E-Business

Using Management Information Systems and Accounting Information

Mastering Financial Management

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Exam 3: Exploring Global Business

Licensing and exporting can be considered relatively low-risk methods of entering foreign markets.

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

If Germany exports $100,000 of sauerkraut to Jamaica and purchases $100,000 of Blue Mountain coffee beans from Jamaica, Germany has

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

The best method of learning from experience in international business is to

Trade restrictions limit choices for consumers but have no effect on the prices charged for the products.

Balance of payments is a much broader concept than balance of trade.

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

The participants in the Kennedy Round have succeeded in reducing tariffs by less than 20 percent.

Miller Beer allows a Canadian firm to use its name, formula, and brands in return for a royalty. This is known as

A ____ is issued by the exporter's bank, ordering the importer's bank to pay for the merchandise.

In 1967, several Asian countries banded together to reduce the trade barriers between them and encourage trading among themselves. This is known as

By definition, every country has a comparative advantage in some product.

What does the International Monetary Fund (IMF) do for nations with an unfavorable balance of trade?

The newest forms of international business structure developed to create competitive advantage on a worldwide basis are called

A letter of credit is issued in favor of the importer.

Countertrade is an international barter transaction in which

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?​

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.

The payments portion of the balance of payments--that is, payments made by the United States--does not include

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

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

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Social Media and E-Business

Using Management Information Systems and Accounting Information

Mastering Financial Management

Filters

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?