Question 1

What are the major sources of export assistance from the federal government?

Accepted Answer

The federal government of the United Sta...

Question 2

A currency devaluation increases the cost of foreign goods and ____ the cost of domestic goods to foreign firms.

Accepted Answer

A)   devalues
B)   increases
C)   balances
D)   decreases
E)   restrictsF) B) and E)
G) A) and D)

Question 3

When Serena from the United States flies to Scotland on a Canadian airline, stays in an Edinburgh hotel, and buys many wool sweaters from Scotland to bring home, she is

Accepted Answer

A)   decreasing the trade deficit.
B)   being disloyal and unpatriotic.
C)   contributing to the negative balance of payments.
D)   buying American-made goods.
E)   buying American-produced services.F) D) and E)
G) C) and D)

Question 4

Which bank was established in 1991 to encourage reconstruction and development in the eastern and central European countries?

Accepted Answer

A)   the Eximbank
B)   the Bank of America
C)   the European Bank for Reconstruction and Development
D)   the Inter-American Development Bank
E)   the International Monetary FundF) A) and C)
G) A) and E)

Question 5

What was the General Agreement on Tariffs and Trade (GATT)? What was its primary objective?

Accepted Answer

The General Agreement on Tariffs and Tra...

Question 6

What are the most frequently cited reasons for restricting trade? How valid are these reasons? Explain.

Accepted Answer

The most frequently cited reasons for re...

Question 7

Trade restrictions usually have no immediate or long-term economic consequences.

Accepted Answer

A) True 
 B)False

Question 8

The total flow of money into a country less the total flow of money out of the country over some period of time is called the country's _____.

Accepted Answer

A)   trade deficit
B)   balance of payments
C)   unfavorable balance
D)   balance of trade
E)   favorable balanceF) B) and D)
G) A) and D)

Question 9

Memories Forever Scrapbooking Company is interested in global expansion but does not want to make a large financial commitment.Therefore, it decides to allow a Japanese company to manufacture and distribute products under the Memories Forever name.This is a(n)  ____ agreement.

Accepted Answer

A)   exporting
B)   strategic alliance
C)   licensing
D)   countertrade
E)   bill of ladingF) A) and B)
G) All of the above

Question 10

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?

Accepted Answer

A)   It has a comparative advantage in wine production.
B)   It has a comparative advantage in timber and oil production.
C)   It has an absolute advantage in the production of wine.
D)   It has an absolute advantage in timber and oil production.
E)   It has no comparative or absolute advantages.F) A) and C)
G) A) and B)

Question 11

Nordstrom's sells designer suits made in Italy in its stores in the United States.Nordstrom's is ____ these suits.

Accepted Answer

A)   exporting
B)   importing
C)   trading
D)   dumping
E)   taxingF) C) and D)
G) A) and B)

Question 12

The IDB, ADB, and EBRD are all examples of _____.

Accepted Answer

A)   eximbanks
B)   foreign banks
C)   economic communities
D)   world trade organizations
E)   multilateral development banksF) D) and E)
G) C) and E)

Question 13

Which is the largest emerging Asian market?

Accepted Answer

A)   Japan
B)   Indonesia
C)   Korea
D)   Malaysia
E)   ChinaF) B) and C)
G) A) and D)

Question 14

Several European countries have 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)   a cartel.
D)   a multinational.
E)   an orderly marketing agreement.F) A) and D)
G) C) and E)

Question 15

China is trying to develop its international trade in electronic components, but it lacks the money to be successful.From whom should China seek assistance?

Accepted Answer

A)   the International Monetary Fund
B)   the Eximbank
C)   the United States
D)   the Federal Reserve
E)   the Development Bank for Emerging EconomiesF) A) and C)
G) B) and E)

Question 16

Comparative advantage is the ability to produce a specific product more efficiently than any other nation.

Accepted Answer

A) True 
 B)False

Question 17

An organization 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.

Accepted Answer

A) True 
 B)False

Question 18

A letter of credit is issued by the transport carrier to the exporter to prove that merchandise has been shipped.

Accepted Answer

A) True 
 B)False

Question 19

The Eximbank does all of the following except

Accepted Answer

A)   act as an independent agency of the U.S.government.
B)   assist in financing the exports of American firms.
C)   cooperate with banks to help exporters offer credit to overseas customers.
D)   extend and guarantee credit to overseas buyers of American goods.
E)   guarantee long-term financing for exports.F) A) and E)
G) A) and D)

Question 20

A trading company

Accepted Answer

A)   is involved in manufacturing.
B)   owns assets related to manufacturing.
C)   does not take title to products.
D)   provides a link between buyers and sellers in different countries.
E)   does not perform activities necessary to move the products.F) A) and B)
G) B) and D)

Exam 3: Exploring Global Business

An organization 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.

Correct AnswerverifiedShow Answer

When Serena from the United States flies to Scotland on a Canadian airline, stays in an Edinburgh hotel, and buys many wool sweaters from Scotland to bring home, she is

Correct AnswerverifiedShow Answer

Several European countries have banded together to reduce the trade barriers between them and encourage trading among themselves.This is known as

Correct AnswerverifiedShow Answer

A letter of credit is issued by the transport carrier to the exporter to prove that merchandise has been shipped.

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Which bank was established in 1991 to encourage reconstruction and development in the eastern and central European countries?

Correct AnswerverifiedShow Answer

What was the General Agreement on Tariffs and Trade (GATT)? What was its primary objective?

Correct AnswerAnswered by ExamLex AIThe General Agreement on Tariffs and Tra...View AnswerShow Answer

The total flow of money into a country less the total flow of money out of the country over some period of time is called the country's _____.

Correct AnswerverifiedShow Answer

The Eximbank does all of the following except

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What are the most frequently cited reasons for restricting trade? How valid are these reasons? Explain.

Correct AnswerAnswered by ExamLex AIThe most frequently cited reasons for re...View AnswerShow Answer

Comparative advantage is the ability to produce a specific product more efficiently than any other nation.

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Nordstrom's sells designer suits made in Italy in its stores in the United States.Nordstrom's is ____ these suits.

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A trading company

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The IDB, ADB, and EBRD are all examples of _____.

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Which is the largest emerging Asian market?

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China is trying to develop its international trade in electronic components, but it lacks the money to be successful.From whom should China seek assistance?

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Memories Forever Scrapbooking Company is interested in global expansion but does not want to make a large financial commitment.Therefore, it decides to allow a Japanese company to manufacture and distribute products under the Memories Forever name.This is a(n) ____ agreement.

Correct AnswerverifiedShow Answer

A currency devaluation increases the cost of foreign goods and ____ the cost of domestic goods to foreign firms.

Correct AnswerverifiedShow Answer

Trade restrictions usually have no immediate or long-term economic consequences.

Correct AnswerverifiedShow Answer

What are the major sources of export assistance from the federal government?

Correct AnswerAnswered by ExamLex AIThe federal government of the United Sta...View AnswerShow Answer

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The General Agreement on Tariffs and Tra...
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The most frequently cited reasons for re...
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The federal government of the United Sta...
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