Exam 3: Regional Economic Integration

A group of free trade member countries that have adopted a common external tariff with nonmember countries is called a(n)_____.

Of the following statements regarding the euro, which is NOT true?

All of the following statements about regional integration are true EXCEPT:

Implementation of a multitude of economic and/or political steps by member states to increase their global competitiveness, including preferential trade access refers to _______.

________ is the union created when member countries of an economic and monetary union work closely with one another to arrive at common defense and foreign policies and behave as a single country.

The largest country in the EU, in terms of population, is _____.

The union created when member countries of an economic and monetary union work closely with one another to arrive at common defense and foreign policies and behave as a single country is known as a(n)_____.

One could argue that regional and global integration are not complements, but substitutes to economic development of a particular region.

Compare and contrast EU and NAFTA as regional integration blocs.

Scenario - The Lynnette Company The Lynette Company was founded in 1982 by Solomon and Andrea Lynette. It is currently based in Jakarta, Indonesia and plans to remain in the region due to the potential for continued market growth. The company provides modern office equipment to customers throughout Southeast Asia and has watched a steady rise in need for its products. Last year, Lynette grossed over five million dollars in sales. It anticipates gross sales to more than double this year. The Lynette Company is pleased by the ample supply of workers from the local region available to help the company. The owners realize this area of the world has the potential to become an important global market. -The Lynette Company's plan to continue its operations within the Asia market offers many benefits as well as challenges. Which one of the following would provide the least degree of challenge for the stability of this company's business operations?

In 1969, frustrated by the lack of progress in LAFTA, Bolivia, Chile, Colombia, Ecuador, and Peru joined in creating the Andean Group, which aimed to create economic integration through reduced taxes, a common external tariff, and investment in the poorer industrial areas of their respective countries.

Scenario - Sarten Gas Company Established in Salt Lake City, UT in 1975, the Sarten Gas Company (SGC) has grown to be a recognized name in the industry. Since its inception, this company has been able to withstand serious economic downturns in the economy. It has been able to remain financially stable when many others in the industry have struggled with financial losses. The expertise and knowledge of its leaders has led the SGC to be one of the few companies in the industry able to report continued growth. This excellent track record has inspired the owners of SGC into embracing the idea of expansion. Sarten plans to begin trading with Canada this year and plans to include trading with Mexico within the next three years. The leaders of Sarten Gas feel confident these new trade deals will prove successful for the company and its shareholders. -Given that SGC's home country, the United States, is part of a regional integration bloc that is based on purely economic goals, benefits to these countries would include all but which one of the following?

How many of the 27 EU member countries are permitted to use the euro as their currency?

The World Bank's World Development Report (WDR), titled "Reshaping Economic Geography," analyzes trade and regional economic integration through the lens of economic geography (i.e., market size, location, and openness to trade). The WDR concludes that positive changes within these three categories are essential for successful regional integration.

ASEAN has two main objectives: 1)to accelerate economic growth, social progress, and cultural development in the region; and 2)_____.

ASEAN's current membership stands at how many countries?

Scenario - Sarten Gas Company Established in Salt Lake City, UT in 1975, the Sarten Gas Company (SGC) has grown to be a recognized name in the industry. Since its inception, this company has been able to withstand serious economic downturns in the economy. It has been able to remain financially stable when many others in the industry have struggled with financial losses. The expertise and knowledge of its leaders has led the SGC to be one of the few companies in the industry able to report continued growth. This excellent track record has inspired the owners of SGC into embracing the idea of expansion. Sarten plans to begin trading with Canada this year and plans to include trading with Mexico within the next three years. The leaders of Sarten Gas feel confident these new trade deals will prove successful for the company and its shareholders. -Which one of the following represents a trade agreement most likely to impact the Sarten Gas Company and its proposed trading partners?

Explain the pros and cons of regional integration.

Of the following, which is NOT a benefit of regional integration?

Scenario - The Lynnette Company The Lynette Company was founded in 1982 by Solomon and Andrea Lynette. It is currently based in Jakarta, Indonesia and plans to remain in the region due to the potential for continued market growth. The company provides modern office equipment to customers throughout Southeast Asia and has watched a steady rise in need for its products. Last year, Lynette grossed over five million dollars in sales. It anticipates gross sales to more than double this year. The Lynette Company is pleased by the ample supply of workers from the local region available to help the company. The owners realize this area of the world has the potential to become an important global market. -Which one of the following would most likely set guidelines for the Lynette Company to follow as it conducts its business in Southeast Asia?