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Exam 3: Global Business

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Question 91

Multiple Choice

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

A) Absolute advantage
B) Specialisation
C) Relative advantage
D) Dominant advantage
E) Comparative advantage

F) A) and B)
G) B) and D)

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Question 92

True/False

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The International Monetary Fund (IMF) makes short-term loans to developing countries experiencing balance-of-payment deficits.

A) True
B) False

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Question 93

Multiple Choice

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Strategic alliances and ____ are very similar.

During a stormy meeting of computer software firms, several company presidents said that without tariff cushions, many of them would go broke.They represent a new industry that needs protection until their firms grow to a size that will allow them to be competitive.Their comments are based on the

When Sony Corporation of Japan purchased Columbia Pictures Entertainment, Inc., of the United States, Sony made a(n)

Despite trade restrictions, international business is

Lynn Bernerd, Inc. Lynn Bernerd, Inc., manufactures and sells reclining furniture.The company wishes to expand overseas.The company managers have been contemplating the best way to enter the foreign market.At first, the management felt it would be in the company's best interest to let a foreign company use its product and brand in exchange for a royalty.The managers recognised, however, that before the company decided on its foreign strategy it needed to think through all the steps required to enter an international market.As such, the managers believed they needed to consult with some type of agency to help their firm compete more effectively in the global marketplace. After all the research was completed, the senior managers realised that they wanted to export their product.The managers decided that the transport carrier would notify them when the merchandise was shipped.This would avoid any confusion about lost shipments and ensure better communication with the receiving parties. -Refer to Lynn Bernerd, Inc.When the transport carriers notify the exporter that the product has been shipped, they use a

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

Cultural barriers can impede acceptance of products in foreign countries.

One of the problems with licensing as a method of achieving international business is that it is a much more difficult procedure to implement than the other methods.

Lynn Bernerd, Inc. Lynn Bernerd, Inc., manufactures and sells reclining furniture.The company wishes to expand overseas.The company managers have been contemplating the best way to enter the foreign market.At first, the management felt it would be in the company's best interest to let a foreign company use its product and brand in exchange for a royalty.The managers recognised, however, that before the company decided on its foreign strategy it needed to think through all the steps required to enter an international market.As such, the managers believed they needed to consult with some type of agency to help their firm compete more effectively in the global marketplace. After all the research was completed, the senior managers realised that they wanted to export their product.The managers decided that the transport carrier would notify them when the merchandise was shipped.This would avoid any confusion about lost shipments and ensure better communication with the receiving parties. -Refer to Lynn Bernerd, Inc.Initially, the managers believed that ____ would be the best option for entering the foreign market.

A firm that has no ties to a specific nation or region and operates on a worldwide scale is called a national enterprise.

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

A small country is just beginning its international trade activities.In so doing, it wants to ____ and to develop a favourable balance of trade.

A trading company provides a link between buyers and sellers in different countries.

Although it lacks sources of timber and oil, Chablis has a plentiful supply of grapes for its many wineries.Which statement about Chablis is true?

An organisation of nations formed to promote the free movement of resources and products among its members and to create common economic policies is called an economic community.

When was GATT first established?

The IDB and ADB are examples of

Ginger decides to take her small company international.Which of the following would most likely be Ginger's and other small business owners' first step in going global?