Question 1

People in the West tend to associate which of the following with a free market system, strong property rights protection, and economic progress?

Accepted Answer

A) Anarchist state 
B) Representative democracy 
C) Planned economy 
D) Communist state 
E) Command economy

Question 2

Discuss the significance of legal systems in the context of shifting toward a market-based economic system.

Accepted Answer

The answer of Discuss the significance of legal systems in...

Question 3

The influential economist Jeffrey Sachs argues that throughout history, which of the following, with their long engagements in international trade, have been the most supportive of market institutions.

Accepted Answer

A) Mountainous states 
B) Tropical regions 
C) Military societies 
D) Landlocked states 
E) Coastal states

Question 4

Social unrest and disorder are less likely to be found in countries that contain more than one ethnic nationality.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following statements is true about the changing economic system since the 1980s?

Accepted Answer

A) There has been a shift from market-based economies to centrally planned economies. 
B) There has been a shift away from a mixed economy. 
C) Many states have restricted the sale of state-owned businesses to private investors. 
D) The competition between economies has been reducing. 
E) The extent to which property rights are protected has declined.

Question 6

The risks of doing business are most likely to be the highest in a country that:

Accepted Answer

A) has low inflation rates. 
B) supports high living standards. 
C) has only one ethnic nationality. 
D) protects intellectual property. 
E) faces frequent changes in government and government policy.

Question 7

Gamma Gene Incorporated has sought your opinion about the overall attractiveness of various countries as potential markets and investment sites. What would you tell them?

Accepted Answer

The answer of Gamma Gene Incorporated has sought your opinion...

Question 8

Generally, the costs and risks associated with doing business in a foreign country are typically lower in:

Accepted Answer

A) less developed countries. 
B) economically advanced countries. 
C) totalitarian states. 
D) countries with high inflation and falling living standards. 
E) countries that lack intellectual property rights.

Question 9

Discuss Jeffrey Sachs's conception of geography, education, and economic development.

Accepted Answer

The answer of Discuss Jeffrey Sachs's conception of geography, education,...

Question 10

Which of the following is broadly defined as the development of new products, processes, organizations, management practices, and strategies?

Accepted Answer

A) Privatization 
B) Economic deregulation 
C) Boundary spanning 
D) Innovation 
E) Benchmarking

Question 11

During the late 1980s and early 1990s, totalitarian governments collapsed and were replaced by democratically elected governments.

Accepted Answer

A) True 
 B)False

Question 12

The Peruvian development economist Hernando de Soto has argued that much of the developing world will fail to reap the benefits of capitalism until they relax the property rights offered by their legal systems.

Accepted Answer

A) True 
 B)False

Question 13

The cost of doing business is most likely to be the lowest in:

Accepted Answer

A) closed totalitarian states. 
B) primitive or undeveloped economies. 
C) open democratic societies. 
D) countries where local laws and regulations set strict standards with regard to product safety, safety in the workplace, and environmental pollution. 
E) countries that lack well-established laws for regulating business practice.

Question 14

Which of the following statements is most likely to be true about the risks of doing business in a country?

Accepted Answer

A) Political risk is low in countries that contain more than one ethnic nationality. 
B) Economic risks are independent of political risk. 
C) One visible indicator of economic risk is the level of business and government debt in the country. 
D) One visible indicator of legal risk tends to be a country's inflation rate. 
E) Political risk tends to be low in those countries that have high inflation and falling living standards.

Question 15

Capricorn Creative Inc., a U.S.-based advertising firm, was the first in the advertising industry to identify the growth potential of Brazil and to make huge investments in its economy. As a result, the firm was able to build brand loyalty and gain experience in that country's business practices. In the language of business strategy, Capricorn Creative has typically benefited from:

Accepted Answer

A) a first-mover advantage. 
B) forward integration. 
C) unrelated differentiation. 
D) lateral diversification. 
E) technology transfer.

Question 16

Which of the following statements is true of purchasing power parity (PPP)?

Accepted Answer

A) PPP figures can be misleading because they don't consider differences in the cost of living. 
B) The PPP for different countries is adjusted (up or down) depending upon whether the cost of living is lower or higher than in Great Britain. 
C) The PPP data gives a static picture of economic development. 
D) China's GNI PPP per capita is higher than that of the United States. 
E) PPP adjustment does not allow for a direct comparison of living standards in different countries.

Question 17

Which of the following steps is most likely to be involved in the deregulation of an economy?

Accepted Answer

A) Increasing restrictions on direct investment by foreign enterprises and international trade 
B) Privatizing state-owned enterprises 
C) Exercising a high degree of state control over production and pricing 
D) Abolishing laws related to the protection of property rights 
E) Opposing democracy by adopting communism

Question 18

The absence of a legal system that protects property rights and the lack of machinery to enforce that system in a market economy usually results in:

Accepted Answer

A) an improvement in the operating efficiency of newly privatized firms. 
B) reduced barriers to foreign direct investment and international trade. 
C) an increase in the incentives to engage in economic activity. 
D) deregulation and privatization of the economy. 
E) the lack of incentive to engage in economic activity.

Question 19

It is more costly to do business in relatively primitive or undeveloped economies because of the lack of infrastructure and supporting businesses.

Accepted Answer

A) True 
 B)False

Question 20

In Samuel Huntington's thesis, global terrorism is a product of the:

Accepted Answer

A) clash of value systems and ideology between civilizations. 
B) widespread acceptance of universal global civilization. 
C) declining liberal democratic ideals. 
D) differences in the factor endowments between countries. 
E) geographical differences between nations.

Exam 3: National Differences in Economic Development

People in the West tend to associate which of the following with a free market system, strong property rights protection, and economic progress?

Discuss the significance of legal systems in the context of shifting toward a market-based economic system.

The influential economist Jeffrey Sachs argues that throughout history, which of the following, with their long engagements in international trade, have been the most supportive of market institutions.

Social unrest and disorder are less likely to be found in countries that contain more than one ethnic nationality.

Which of the following statements is true about the changing economic system since the 1980s?

The risks of doing business are most likely to be the highest in a country that:

Gamma Gene Incorporated has sought your opinion about the overall attractiveness of various countries as potential markets and investment sites. What would you tell them?

Generally, the costs and risks associated with doing business in a foreign country are typically lower in:

Discuss Jeffrey Sachs's conception of geography, education, and economic development.

Which of the following is broadly defined as the development of new products, processes, organizations, management practices, and strategies?

During the late 1980s and early 1990s, totalitarian governments collapsed and were replaced by democratically elected governments.

The Peruvian development economist Hernando de Soto has argued that much of the developing world will fail to reap the benefits of capitalism until they relax the property rights offered by their legal systems.

The cost of doing business is most likely to be the lowest in:

Which of the following statements is most likely to be true about the risks of doing business in a country?

Which of the following statements is true of purchasing power parity (PPP) ?

Which of the following steps is most likely to be involved in the deregulation of an economy?

The absence of a legal system that protects property rights and the lack of machinery to enforce that system in a market economy usually results in:

It is more costly to do business in relatively primitive or undeveloped economies because of the lack of infrastructure and supporting businesses.

In Samuel Huntington's thesis, global terrorism is a product of the: