Question 1

A comparative advantage exists when a country can produce something more cheaply and/or of higher quality than any other country.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is the name for the economic value of all of the products that a country exports minus the economic value of its imports?

Accepted Answer

A)  balance of foreign competition 
B)  balance of domestic competition 
C)  balance of trade 
D)  balance of payments 
E)  balance of supply and demand

Question 3

The single largest trading partner of the United States is China.

Accepted Answer

A) True 
 B)False

Question 4

Explain how a firm may have more direct control with a branch office than it does over agents or license holders.

Accepted Answer

The answer of Explain how a firm may have more...

Question 5

Under U.S.antidumping legislation,what conditions must be met to prove that dumping is being practiced?

Accepted Answer

The answer of Under U.S.antidumping legislation,what conditions must be met...

Question 6

Which of the following statements BEST describes the effects of subsidies?

Accepted Answer

A)  A subsidy essentially lowers the prices of foreign goods rather than raising the prices of domestic goods. 
B)  A subsidy essentially raises the prices of domestic goods rather than lowering the prices of foreign goods. 
C)  A subsidy essentially lowers the prices of domestic goods rather than raising the prices of foreign goods. 
D)  A subsidy essentially raises the prices of foreign goods while also raising the prices of domestic goods. 
E)  A subsidy essentially lowers the prices of foreign goods while also lowering the prices of domestic goods.

Question 7

The United States has large trade deficits with Japan,China,and Mexico; this means that the United States has imported more from them than what they have purchased from us.

Accepted Answer

A) True 
 B)False

Question 8

Which organization created the classification of countries based on per capita income?

Accepted Answer

A)  the World Bank 
B)  the World Trade Organization 
C)  the International Monetary Fund 
D)  the European Union 
E)  the North American Free Trade Agreement

Question 9

Country Z can produce pig iron more efficiently than any other goods.Which type of advantage in pig iron does Country Z have?

Accepted Answer

A)  absolute advantage 
B)  national competitive advantage 
C)  comparative advantage 
D)  monopolistic advantage 
E)  resource advantage

Question 10

What is a difference between an international firm and a multinational firm?

Accepted Answer

A)  Multinational firms design, produce, and market products in many nations, whereas international firms are based primarily in one nation. 
B)  International firms design, produce, and market products in many nations, whereas multinational firms are based primarily in one nation. 
C)  International and multinational firms are the same thing. 
D)  Multinational firms are concerned primarily with foreign markets, whereas international firms are concerned primarily with the domestic market. 
E)  International firms are concerned primarily with foreign markets, whereas multinational firms are concerned primarily with the domestic market.

Question 11

Citronel's CEO thinks that a market segment already exists worldwide that will be receptive to Citronel's product line.Which of the following,if true,would strengthen the CEO's position?

Accepted Answer

A)  People in different parts of the world tend to embrace their own clothing fashions. 
B)  Consumers in different parts of the world have varied spending power. 
C)  Clothing fashions that originate in France tend to appeal to different places in the world. 
D)  Citronel has accumulated extensive market data on French consumers. 
E)  Citronel has been in business for only a few years.

Question 12

Which of the following is illegal in the United States?

Accepted Answer

A)  dumping, but not cartels 
B)  cartels, but not dumping 
C)  only certain kinds of dumping and cartels 
D)  neither dumping nor cartels 
E)  both dumping and cartels

Question 13

In Germany,Wal-Mart has been required to buy existing retailers rather than open brand-new stores.What does this illustrate?

Accepted Answer

A)  local content laws 
B)  fair trade agreements 
C)  free trade agreements 
D)  licensing arrangements 
E)  business practice laws

Question 14

Low-income countries have an annual per capita income of $2,500 or less.

Accepted Answer

A) True 
 B)False

Question 15

The ultimate form of a quota is a tariff.

Accepted Answer

A) True 
 B)False

Question 16

Explain a floating exchange rate.

Accepted Answer

The answer of Explain a floating exchange rate....

Question 17

Define licensing arrangement and strategic alliance and discuss their relative merits.

Accepted Answer

The answer of Define licensing arrangement and strategic alliance and...

Question 18

Which of the following is NOT considered an international organizational structure?

Accepted Answer

A)  independent agents 
B)  licensing arrangements 
C)  foreign direct investments 
D)  branch office 
E)  exporters

Question 19

If you have given another company in another country the right to produce your company's product,you are engaging in a licensing arrangement.

Accepted Answer

A) True 
 B)False

Question 20

South Africa produces diamonds more cheaply and of higher quality than any other country; this is an example of absolute advantage.

Accepted Answer

A) True 
 B)False

Exam 4: Understanding the Global Context of Business

A comparative advantage exists when a country can produce something more cheaply and/or of higher quality than any other country.

Which of the following is the name for the economic value of all of the products that a country exports minus the economic value of its imports?

The single largest trading partner of the United States is China.

Explain how a firm may have more direct control with a branch office than it does over agents or license holders.

Under U.S.antidumping legislation,what conditions must be met to prove that dumping is being practiced?

Which of the following statements BEST describes the effects of subsidies?

The United States has large trade deficits with Japan,China,and Mexico; this means that the United States has imported more from them than what they have purchased from us.

Which organization created the classification of countries based on per capita income?

Country Z can produce pig iron more efficiently than any other goods.Which type of advantage in pig iron does Country Z have?

What is a difference between an international firm and a multinational firm?

Citronel's CEO thinks that a market segment already exists worldwide that will be receptive to Citronel's product line.Which of the following,if true,would strengthen the CEO's position?

Which of the following is illegal in the United States?

In Germany,Wal-Mart has been required to buy existing retailers rather than open brand-new stores.What does this illustrate?

Low-income countries have an annual per capita income of $2,500 or less.

The ultimate form of a quota is a tariff.

Explain a floating exchange rate.

Define licensing arrangement and strategic alliance and discuss their relative merits.

Which of the following is NOT considered an international organizational structure?

If you have given another company in another country the right to produce your company's product,you are engaging in a licensing arrangement.

South Africa produces diamonds more cheaply and of higher quality than any other country; this is an example of absolute advantage.