Question 1

Export trading companies assist businesses in reaching buyers, and dealing with customs, documentation, and payment.

Accepted Answer

A) True 
 B)False

Question 2

If global trade experts predict that the value of the dollar will soon fall, it will result in

Accepted Answer

A)  both the prices of imported goods rising and prices of U.S. goods sold overseas rising, as well. 
B)  prices of imported goods rising, but prices of U.S. goods sold overseas falling. 
C)  prices of imported goods falling and prices of U.S. goods sold overseas falling, as well. 
D)  prices of imported goods falling, but prices of U.S. goods sold overseas rising. 
A)  both the prices of imported goods rising and prices of U.S. goods sold overseas rising, as well. 
B)  prices of imported goods rising, but prices of U.S. goods sold overseas falling. 
C)  prices of imported goods falling and prices of U.S. goods sold overseas falling, as well. 
D)  prices of imported goods falling, but prices of U.S. goods sold overseas rising.

Question 3

Protective tariffs are designed to raise money for the government.

Accepted Answer

A) True 
 B)False

Question 4

The common market arrangement that groups Brazil, Argentina, Paraguay, Uruguay, Bolivia, Chile, Colombia, Ecuador, Peru, and Suriname is called

Accepted Answer

A)  the South American Trade Organization. 
B)  the World Trade Organization (WTO). 
C)  the Latin Free Trade Zone. 
D)  Mercosur. 
A)  the South American Trade Organization. 
B)  the World Trade Organization (WTO). 
C)  the Latin Free Trade Zone. 
D)  Mercosur.

Question 5

________ is the selling of products to another country.

Accepted Answer

A)  In-trading 
B)  Exporting 
C)  Importing 
D)  Dumping 
A)  In-trading 
B)  Exporting 
C)  Importing 
D)  Dumping

Question 6

In recent years, the government of Norway has invested over $905 billion in foreign companies, including several U.S. companies. This move constitutes the creation of a sovereign wealth fund, an emerging type of foreign direct investment.

Accepted Answer

A) True 
 B)False

Question 7

A United States company won a large contract with a company in Sri Lanka by giving government and company representatives American cars. The company also promised to provide monetary gifts in exchange for the business. Fortunately, U.S. law, under the Foreign Corrupt Practices Act, permits U.S. companies to operate in this manner.

Accepted Answer

A) True 
 B)False

Question 8

Traders in the seventeenth and eighteenth century were encouraged to focus on selling their nation's goods in the global market to create a favorable balance of trade. Nations attempted to sell more goods to other nations than they bought from other nations. This approach to global trading is called

Accepted Answer

A)  ethnocentrism. 
B)  mercantilism. 
C)  protectionism. 
D)  isolationism. 
A)  ethnocentrism. 
B)  mercantilism. 
C)  protectionism. 
D)  isolationism.

Question 9

Jitensha Bike Parts was called to testify before the U.S. Congress. The CEO of Jitensha defended the company against an accusation that it was dumping parts on the U.S. market. In her testimony, the CEO claimed ________. Using traditional guidelines, Congress determined that Jitensha was not dumping.

Accepted Answer

A)  Jitensha includes 10% overhead costs and an 8% profit margin in the price of all the parts they export to the U.S. 
B)  Japan runs a trade deficit with the U.S. in bike parts. 
C)  Jitensha is a staunch supporter of free trade. 
D)  Jitensha sells more bike parts in Europe than it does in the U.S. 
A)  Jitensha includes 10% overhead costs and an 8% profit margin in the price of all the parts they export to the U.S. 
B)  Japan runs a trade deficit with the U.S. in bike parts. 
C)  Jitensha is a staunch supporter of free trade. 
D)  Jitensha sells more bike parts in Europe than it does in the U.S.

Question 10

The United States' highest trade deficit is with China.

Accepted Answer

A) True 
 B)False

Question 11

Global trade includes the exchange of art, sports, and cultural events.

Accepted Answer

A) True 
 B)False

Question 12

Trade experts' concerns about trading with China include its

Accepted Answer

A)  small population size compared to other nations, which puts doubt in businesspeople's minds about the worthiness of the investment. 
B)  one-party political system, counterfeiting activities, and human rights abuses. 
C)  ties with organized labor unions. 
D)  economic philosophy that has changed from free market to command economy. 
A)  small population size compared to other nations, which puts doubt in businesspeople's minds about the worthiness of the investment. 
B)  one-party political system, counterfeiting activities, and human rights abuses. 
C)  ties with organized labor unions. 
D)  economic philosophy that has changed from free market to command economy.

Question 13

American businesspeople often fail to adapt to foreign markets because they feel that the American culture is superior to other cultures in the world.

Accepted Answer

A) True 
 B)False

Question 14

An important principle for firms desiring to export is

Accepted Answer

A)  sell to countries with high standards of living. 
B)  keep in mind that American methods are probably always best. 
C)  find a need in the global market and fill it. 
D)  if your product sells well in the U.S. it will sell well globally. 
A)  sell to countries with high standards of living. 
B)  keep in mind that American methods are probably always best. 
C)  find a need in the global market and fill it. 
D)  if your product sells well in the U.S. it will sell well globally.

Question 15

The European Union created a single monetary unit to replace the national currencies of 12 member nations. This common currency is known as the

Accepted Answer

A)  e-dollar. 
B)  pound. 
C)  mercosur. 
D)  euro. 
A)  e-dollar. 
B)  pound. 
C)  mercosur. 
D)  euro.

Question 16

The nation of Taubestan requires that all imported beverages be contained in clear, well-labeled recyclable glass bottles. Several international beverage manufacturers refuse to trade with the country because the cost of glass bottles cuts into their profits to the point where it just isn't worth it. Taubestan has created a nontariff barrier.

Accepted Answer

A) True 
 B)False

Question 17

Contract manufacturing is a form of outsourcing.

Accepted Answer

A) True 
 B)False

Question 18

A ________ tariff is designed to raise the price of imported products so that domestic goods are more competitively priced.

Accepted Answer

A)  protective 
B)  restrictive 
C)  progressive 
D)  revenue 
A)  protective 
B)  restrictive 
C)  progressive 
D)  revenue

Question 19

Banana plantations in Hawaii cannot produce nearly enough of all the bananas consumed by Americans. The fact that the U.S. grows and sells bananas gives it a comparative advantage in bananas. It is not an absolute advantage and that is why we choose to import bananas from South America, as well.

Accepted Answer

A) True 
 B)False

Question 20

A favorable balance of trade occurs when the value of

Accepted Answer

A)  imports equals the value of exports. 
B)  the cash inflows equals the value of the cash outflows. 
C)  imports is less than the value of exports. 
D)  the dollar is greater than the value of the euro. 
A)  imports equals the value of exports. 
B)  the cash inflows equals the value of the cash outflows. 
C)  imports is less than the value of exports. 
D)  the dollar is greater than the value of the euro.

Exam 3: Doing Business in Global Markets

Export trading companies assist businesses in reaching buyers, and dealing with customs, documentation, and payment.

If global trade experts predict that the value of the dollar will soon fall, it will result in

Protective tariffs are designed to raise money for the government.

The common market arrangement that groups Brazil, Argentina, Paraguay, Uruguay, Bolivia, Chile, Colombia, Ecuador, Peru, and Suriname is called

________ is the selling of products to another country.

In recent years, the government of Norway has invested over $905 billion in foreign companies, including several U.S. companies. This move constitutes the creation of a sovereign wealth fund, an emerging type of foreign direct investment.

The United States' highest trade deficit is with China.

Global trade includes the exchange of art, sports, and cultural events.

Trade experts' concerns about trading with China include its

American businesspeople often fail to adapt to foreign markets because they feel that the American culture is superior to other cultures in the world.

An important principle for firms desiring to export is

The European Union created a single monetary unit to replace the national currencies of 12 member nations. This common currency is known as the

Contract manufacturing is a form of outsourcing.

A ________ tariff is designed to raise the price of imported products so that domestic goods are more competitively priced.

Banana plantations in Hawaii cannot produce nearly enough of all the bananas consumed by Americans. The fact that the U.S. grows and sells bananas gives it a comparative advantage in bananas. It is not an absolute advantage and that is why we choose to import bananas from South America, as well.

A favorable balance of trade occurs when the value of

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding Economics and How It Affects Business

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Structuring Organizations for Todays Challenges

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemanagement Issues

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Working Within the Legal Environment

Using Technology to Manage Information

Managing Risk

Managing Personal Finances

Filters