Question 1

CAFTA, NAFTA, OECD, and OPEC are all examples of

Accepted Answer

A)  political organizations.
B)  peace treaties.
C)  international economic communities.
D)  World Trade Organization members.
E)  democratic organizations.F) D) and E)
G) C) and D)

Question 2

Which of the following represents the highest level of involvement in international business?

Accepted Answer

A)  Strategic alliance
B)  Totally owned facilities
C)  Multinational firm
D)  Joint ventures
E)  ExportingF) B) and C)
G) B) and D)

Question 3

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 B)
G) C) and D)

Question 4

The World Trade Organization (WTO) was established by GATT to oversee the provisions of the Uruguay Round.

Accepted Answer

A) True 
 B)False

Question 5

Soccer to the Masses 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 Soccer to the Masses name. This is a(n)  ____ agreement.

Accepted Answer

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

Question 6

Which of the following functions is not performed by a trading company?

Accepted Answer

A)  Taking title to products
B)  Manufacturing products for foreign trading
C)  Linking buyers and sellers in different countries
D)  Buying products at the lowest price consistent with quality
E)  Performing activities necessary to move goods to the foreign countryF) C) and D)
G) B) and D)

Question 7

A tariff is a tax levied on a particular foreign product entering a country.

Accepted Answer

A) True 
 B)False

Question 8

The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)

Accepted Answer

A)  import duty.
B)  foreign exchange control.
C)  import quota.
D)  embargo.
E)  export duty.F) C) and D)
G) A) and C)

Question 9

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

Accepted Answer

A) True 
 B)False

Question 10

An unfavorable trade balance is called a(n)

Accepted Answer

A)  balance of trade.
B)  trade deficit.
C)  currency devaluation.
D)  balance of payments.
E)  import balance.F) B) and E)
G) A) and E)

Question 11

Suppose Gillette is seeking a manufacturer in Bangladesh that will produce and market Gillette razors in that country. Gillette expects a royalty from its partner in Bangladesh. Which arrangement will be the best choice for Gillette?

Accepted Answer

A)  Export/import merchant agreement
B)  Export/import agent agreement
C)  Joint venture
D)  Licensing
E)  Multinational agreementF) A) and B)
G) A) and C)

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

Because it controls the world's diamond deposits, the DeBeers Consolidated Mines, Ltd., has a(n)

Accepted Answer

A)  absolute advantage.
B)  comparative advantage.
C)  advantage based on efficient production.
D)  trade deficit.
E)  lot of diamonds.F) A) and E)
G) All of the above

Question 14

When a coffee chain in Portland, Oregon purchases coffee from Colombia, South America, it

Accepted Answer

A)  is importing the coffee.
B)  is exporting the coffee.
C)  has an absolute advantage.
D)  is decreasing the balance-of-trade deficit.
E)  is making a big mistake.F) A) and B)
G) A) and C)

Question 15

A(n)  ____ will, for a commission or fee, arrange the sale of a company's products to foreign intermediaries.

Accepted Answer

A)  export-import merchant
B)  international bank
C)  joint venture
D)  export-import agent
E)  trading brokerF) A) and D)
G) None of the above

Question 16

When the U.S. government will not allow meat from another country to be marketed in the United States, it is imposing a(n)

Accepted Answer

A)  quota.
B)  devaluation.
C)  tariff.
D)  duty.
E)  embargo.F) A) and B)
G) B) and E)

Question 17

The Saudi Arabian government does not allow the consumption of alcoholic beverages within its country. The Saudi Arabian government is imposing a(n)

Accepted Answer

A)  import quota.
B)  currency devaluation.
C)  prohibition.
D)  embargo.
E)  dumping restriction.F) A) and E)
G) A) and B)

Question 18

Mention some of the most frequently cited reasons for restricting trade.

Accepted Answer

In addition to political reasons for tra...

Question 19

Because it has not been around long enough to establish itself, the Russian automobile industry could be classified as a(n)

Accepted Answer

A)  hopeless industry.
B)  soft industry.
C)  infant industry.
D)  protected industry.
E)  toddler industry.F) C) and D)
G) A) and B)

Question 20

What are nontariff barriers? How do nontariff barriers restrict international trade?

Accepted Answer

A nontariff barrier is a nontax measure ...

Exam 3: Exploring Global Business

Suppose Gillette is seeking a manufacturer in Bangladesh that will produce and market Gillette razors in that country. Gillette expects a royalty from its partner in Bangladesh. Which arrangement will be the best choice for Gillette?

Correct AnswerverifiedShow Answer

The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)

Correct AnswerverifiedShow Answer

An unfavorable trade balance is called a(n)

Correct AnswerverifiedShow Answer

A tariff is a tax levied on a particular foreign product entering a country.

Correct AnswerverifiedShow Answer

Which of the following functions is not performed by a trading company?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Soccer to the Masses 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 Soccer to the Masses name. This is a(n) ____ agreement.

Correct AnswerverifiedShow Answer

When a coffee chain in Portland, Oregon purchases coffee from Colombia, South America, it

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

When the U.S. government will not allow meat from another country to be marketed in the United States, it is imposing a(n)

Correct AnswerverifiedShow Answer

What are nontariff barriers? How do nontariff barriers restrict international trade?

Correct AnswerverifiedA nontariff barrier is a nontax measure ...View AnswerShow Answer

Which of the following represents the highest level of involvement in international business?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The Saudi Arabian government does not allow the consumption of alcoholic beverages within its country. The Saudi Arabian government is imposing a(n)

Correct AnswerverifiedShow Answer

Because it controls the world's diamond deposits, the DeBeers Consolidated Mines, Ltd., has a(n)

Correct AnswerverifiedShow Answer

The World Trade Organization (WTO) was established by GATT to oversee the provisions of the Uruguay Round.

Correct AnswerverifiedShow Answer

Because it has not been around long enough to establish itself, the Russian automobile industry could be classified as a(n)

Correct AnswerverifiedShow Answer

CAFTA, NAFTA, OECD, and OPEC are all examples of

Correct AnswerverifiedShow Answer

Mention some of the most frequently cited reasons for restricting trade.

Correct AnswerverifiedIn addition to political reasons for tra...View AnswerShow Answer

A(n) ____ will, for a commission or fee, arrange the sale of a company's products to foreign intermediaries.

Correct AnswerverifiedShow Answer

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A nontariff barrier is a nontax measure ...
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In addition to political reasons for tra...
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Correct Answer
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