Exam 3: Doing Business in Global Markets

One of the goals of the World Trade Organization (WTO) is to eliminate national subsidies on agricultural products.

Explain and provide at least one example of how sociocultural differences can create trade difficulties in world markets.

A favorable balance of trade occurs when the value of a country's exports exceeds the value of its exports.

When Nestlé, a Swiss company, purchased Ralston Purina, a U.S. company, Ralston Purina became a foreign licensee.

Many business experts contend that ________ will likely be the growth market of the future.

Jessie has crafted a new technique for drying flowers that still keeps the vibrant color of fresh flowers. After unsuccessfully trying to sell the dried flowers at her shop, Flowers and Weeds, she discovered that although dried flowers are out of style in the U.S., these flower arrangements are still highly sought after in several nations abroad. It is difficult to preserve the ingredients that go into her formula for more than a month. She decides to partner with firms in Europe and Asia to make and sell her formula, but you suggest she license it to foreign companies and agree to royalties when they create the formula and sell it. Your advice makes better sense.

At first, Rhett believed he should maintain all of his manufacturing within the United States and simply export his designer frames to foreign sellers. However, he lacked expertise in exporting. Rhett decided to see if the federal government could provide any help by contacting a(n)

When a firm agrees to license its product, it gains notoriety but gives up all revenues.

The quinoa seed is in high demand in wealthy countries but is not farmed in those countries. Approximately 97% of all quinoa production comes from small farmers in Taubestan who farm at high elevations. The seed is now considered an important ________ for Taubestan.

A complete ban on the import or export of a specific good is called an embargo.

Taubestan produces nearly 97% of the quinoa consumed around the world, and most of it is sold to wealthy nations. Although there are other areas where the seed will grow, including some areas in wealthier nations, the majority of the quinoa sold is imported from Taubestan. This country has a(n) ________ in the production of quinoa.

The U.S. and China continue to spar over sociocultural issues, such as human rights, and economic and financial issues, such as the value of the Chinese yuan against the U.S. dollar. U.S. diplomats assert that these differences continue to bolster China's favorable balance of trade and increase the U.S. trade deficit. The trade protectionist policy exhibited by the Chinese is similar to an economic policy known as ________ that was followed during the seventeenth and eighteenth centuries. This policy resulted in a flow of money to the country that sold the most globally.

The main goal of the General Agreement on Tariffs and Trade (GATT) was to reduce trade restrictions among world nations.

The only deposits of a rare and sought-after mineral known as ursarite are found in Russia. Since no other nation has deposits of ursarite, Russia has a(n)________ in this mineral.

A concern with the second wave of offshore outsourcing is greater job loss for service-sector working Americans.

When U.S. firms choose to hire skilled and unskilled workers in other countries to produce goods and services, rather than producing them in the United States, we refer to this as

Which of the following statements is a good prediction of future occurrences in global markets?

Small businesses are less involved in global trade today than in the past.

Contract manufacturing is a low-cost way for Banana Republic to outsource the production of its clothing designs.

________ is an arrangement whereby someone with a good idea for a business sells the rights to use the business name and sell the parent company's product or service to others in a given territory in a specified manner.