Deck 10: Foreign Investment: Researching Risk

Question 1

US based multinationals can seek to insure their business operations in developing countries via ______.

A) OPEC
B) OPIC
C) MEGA
D) WTO

Answer 1

B

Question 2

Reasons why multinational firms invest abroad include all except _______.

A) Access to child labor
B) Seeking new markets in which to sell
C) Access to raw materials
D) Technology acquisition

Answer 2

A

Question 3

Examples of conflicting objectives between multinationals and host governments include all except ______.

A) Ownership and use of research & development
B) Economies of scale vs. domestic utilization
C) Use of contracts to create stabile business environment vs. reduction of contract security
D) Economies of scale vs. economies of scope

Answer 3

D

Question 4

In the early 1900s the commanding heights of the economy included all except ______.

A) Railroads
B) Telecommunications
C) Steel
D) Heavy industry

Question 5

Placing limits on the amount of profits which are allowed to be returned to the home country of a multinational firm is known as _______.

A) Expropriation
B) Nationalization
C) Repatriation
D) Appropriation

Question 6

Firms that use the news media to shape public opinion as to multinational presence in a given country is known as ______.

A) Direct lobbying
B) Appropriation
C) Dumping
D) Indirect lobbying

Question 7

Forward integration is _____

A) Concerned with the removal of middlemen in the operations process
B) When a producer of soft drinks sets up its own bottling plant overseas
C) Quickening the pace of production of a good or service
D) Both A and B are correct

Question 8

Manipulation of a company's pricing structure for tax advantages is known as _______.

A) Price controls
B) Transfer costing
C) Transfer pricing
D) Variable pricing

Question 9

The lowering of a firm's costs via business expansion is known as ______.

A) Economies of scope
B) Economies of class
C) Economies of scale
D) Economies of skill

Question 10

The United States typically ranks the highest in the most business friendly environment surveys.

Question 11

The phrase "Commanding Heights" was coined by John Lennon.

Question 12

Under the WTO, providing trade advantages for former colonies is legally permissible.

Question 13

Repatriation of profits is not possible for US firms operating in France.

Question 14

A new socialist government sweeping to power represents a political threat for a multinational firm.