Question 1

All of the following are features of the diamond of national advantage theory EXCEPT ________.

Accepted Answer

A)  firm strategy, structure, and rivalry 
B)  strategic trade policy regulations 
C)  related and supporting industries 
D)  demand conditions 
A)  firm strategy, structure, and rivalry 
B)  strategic trade policy regulations 
C)  related and supporting industries 
D)  demand conditions B

Question 2

The factor proportions theory holds that countries should concentrate production on those products that use their most abundant production factors.

Accepted Answer

A) True 
 B)False  True

Question 3

Understanding trade theories helps companies know if they will need to compete against goods and services produced abroad.

Accepted Answer

A) True 
 B)False  True

Question 4

According to the PLC theory,developing countries have their best production advantage in which stage of the product life cycle?

Accepted Answer

A)  growth 
B)  maturity 
C)  decline 
D)  introduction 
A)  growth 
B)  maturity 
C)  decline 
D)  introduction

Question 5

Which of the following is NOT a reason that international trade theory is useful for managers to understand?

Accepted Answer

A)  Countries use trade theories to help them decide how to improve their competitive positions, such as improving the quantity and quality of production factors. 
B)  Countries' trade policies affect whether imports are allowed to compete against domestic production, thus affecting where companies need to produce to serve given markets. 
C)  Countries use laissez-faire policies to intervene in the free movement of international trade, thus affecting where companies can produce most efficiently. 
D)  Countries wrestle with the questions and set policies on what, with whom, and how much they should import and export, thus affecting companies' abilities to produce given products efficiently and sell them into given markets. 
A)  Countries use trade theories to help them decide how to improve their competitive positions, such as improving the quantity and quality of production factors. 
B)  Countries' trade policies affect whether imports are allowed to compete against domestic production, thus affecting where companies need to produce to serve given markets. 
C)  Countries use laissez-faire policies to intervene in the free movement of international trade, thus affecting where companies can produce most efficiently. 
D)  Countries wrestle with the questions and set policies on what, with whom, and how much they should import and export, thus affecting companies' abilities to produce given products efficiently and sell them into given markets.

Question 6

Between now and 2050,countries undergoing a simultaneous population reduction and an increased percentage of retirees in the population most likely will need more ________.

Accepted Answer

A)  imports 
B)  immigrants 
C)  domestic products 
D)  favorable balances of trade 
A)  imports 
B)  immigrants 
C)  domestic products 
D)  favorable balances of trade

Question 7

According to the PLC theory,at an early stage of a product's life cycle the product is likely to be made in a more ________ method than in its later stages.

Accepted Answer

A)  capital-intensive 
B)  labor-intensive 
C)  land-intensive 
D)  low-cost 
A)  capital-intensive 
B)  labor-intensive 
C)  land-intensive 
D)  low-cost

Question 8

Which of the following undesirable results will most likely occur for a country running a favorable balance of trade?

Accepted Answer

A)  higher unemployment 
B)  higher domestic interest rates 
C)  fewer funds to invest abroad 
D)  granting credit that may be risky 
A)  higher unemployment 
B)  higher domestic interest rates 
C)  fewer funds to invest abroad 
D)  granting credit that may be risky

Question 9

The diamond of national advantage would be best used to answer which of the following questions?

Accepted Answer

A)  How do developed countries prevent the trade of blood diamonds? 
B)  How can developing countries create a significant trade surplus? 
C)  Why do specialized competitive advantages differ among countries? 
D)  Why do most innovative products originate in developed countries? 
A)  How do developed countries prevent the trade of blood diamonds? 
B)  How can developing countries create a significant trade surplus? 
C)  Why do specialized competitive advantages differ among countries? 
D)  Why do most innovative products originate in developed countries?

Question 10

All the following are reasons for the lower international mobility of people than capital EXCEPT which one?

Accepted Answer

A)  The differences in economic return between countries are lower for people than for capital. 
B)  It is more expensive to move people than capital. 
C)  People may have to learn another language and adapt to a different culture. 
D)  International capital transfers have less cumbersome legal restrictions than international movements of people. 
A)  The differences in economic return between countries are lower for people than for capital. 
B)  It is more expensive to move people than capital. 
C)  People may have to learn another language and adapt to a different culture. 
D)  International capital transfers have less cumbersome legal restrictions than international movements of people.

Question 11

In a short essay,discuss the theory of absolute advantage and the reasons a country's efficiency improves based on this theory.

Accepted Answer

The theory of absolute advantage holds t

Question 12

Analysts conclude that the finite supply of natural resources will most likely ________.

Accepted Answer

A)  cause a higher proportion of world trade to occur among developed countries 
B)  cause a higher proportion of world trade to occur among developing countries 
C)  serve as an advantage for developing countries in their sales to developed countries 
D)  create a greater portion of world trade in the form of services 
A)  cause a higher proportion of world trade to occur among developed countries 
B)  cause a higher proportion of world trade to occur among developing countries 
C)  serve as an advantage for developing countries in their sales to developed countries 
D)  create a greater portion of world trade in the form of services

Question 13

Most world trade takes place ________.

Accepted Answer

A)  between developed countries and developing countries 
B)  among developed countries 
C)  among developing countries 
D)  between raw material exporters and manufacturing exporters 
A)  between developed countries and developing countries 
B)  among developed countries 
C)  among developing countries 
D)  between raw material exporters and manufacturing exporters

Question 14

Contrary to the product life cycle theory,there has been an increased tendency for companies to ________.

Accepted Answer

A)  sell products only in their home markets throughout the cycle 
B)  produce and sell products in countries where counterfeiting is low 
C)  introduce new products simultaneously in domestic and foreign markets 
D)  sell new products in developing countries before expanding into developed countries 
A)  sell products only in their home markets throughout the cycle 
B)  produce and sell products in countries where counterfeiting is low 
C)  introduce new products simultaneously in domestic and foreign markets 
D)  sell new products in developing countries before expanding into developed countries

Question 15

Which of the following is most likely a basis for a Jamaican natural advantage in international trade?

Accepted Answer

A)  product technology developed by a Jamaican company 
B)  high literacy rates among Jamaican citizens 
C)  the use of English as the primary language 
D)  beautiful beaches and climate 
A)  product technology developed by a Jamaican company 
B)  high literacy rates among Jamaican citizens 
C)  the use of English as the primary language 
D)  beautiful beaches and climate

Question 16

Under mercantilism,colonial powers sought to run trade surpluses with their colonies by preventing the colonies from manufacturing.

Accepted Answer

A) True 
 B)False

Question 17

An exception to the PLC theory in terms of production location is often a product with very rapid change in innovation.

Accepted Answer

A) True 
 B)False

Question 18

Trade occurs more between culturally dissimilar countries than between culturally similar countries.

Accepted Answer

A) True 
 B)False

Question 19

In a short essay,discuss the four stages of the international product life cycle.

Accepted Answer

The international product life cycle the

Question 20

Why should managers in international business understand international trade theories?

Accepted Answer

A)  Countries' trade policies, based on trade theories, influence which products companies might export to given countries. 
B)  The understanding helps managers decide whether their companies should follow laissez-faire management practices. 
C)  The theories help managers decide whether to use large-scale versus small-scale technologies for serving their export markets. 
D)  The comprehension is useful when deciding whether to transfer managers abroad to manage foreign operations. 
A)  Countries' trade policies, based on trade theories, influence which products companies might export to given countries. 
B)  The understanding helps managers decide whether their companies should follow laissez-faire management practices. 
C)  The theories help managers decide whether to use large-scale versus small-scale technologies for serving their export markets. 
D)  The comprehension is useful when deciding whether to transfer managers abroad to manage foreign operations.

All of the following are features of the diamond of national advantage theory EXCEPT ________.

The factor proportions theory holds that countries should concentrate production on those products that use their most abundant production factors.

Understanding trade theories helps companies know if they will need to compete against goods and services produced abroad.

According to the PLC theory,developing countries have their best production advantage in which stage of the product life cycle?

Which of the following is NOT a reason that international trade theory is useful for managers to understand?

Between now and 2050,countries undergoing a simultaneous population reduction and an increased percentage of retirees in the population most likely will need more ________.

According to the PLC theory,at an early stage of a product's life cycle the product is likely to be made in a more ________ method than in its later stages.

Which of the following undesirable results will most likely occur for a country running a favorable balance of trade?

The diamond of national advantage would be best used to answer which of the following questions?

All the following are reasons for the lower international mobility of people than capital EXCEPT which one?

In a short essay,discuss the theory of absolute advantage and the reasons a country's efficiency improves based on this theory.

Analysts conclude that the finite supply of natural resources will most likely ________.

Most world trade takes place ________.

Contrary to the product life cycle theory,there has been an increased tendency for companies to ________.

Which of the following is most likely a basis for a Jamaican natural advantage in international trade?

Under mercantilism,colonial powers sought to run trade surpluses with their colonies by preventing the colonies from manufacturing.

An exception to the PLC theory in terms of production location is often a product with very rapid change in innovation.

Trade occurs more between culturally dissimilar countries than between culturally similar countries.

In a short essay,discuss the four stages of the international product life cycle.

Why should managers in international business understand international trade theories?

Globalization and International Business

The Cultural Environments Facing Business

The Political and Legal Environments Facing Business

The Economic Environments Facing Businesses

Globalization and Society

Governmental Influence on Trade

Cross-National Cooperation and Agreements

Global Foreign-Exchange Markets

The Determination of Exchange Rates

The Strategy of International Business

Country Evaluation and Selection

Export and Import

Direct Investment and Collaborative Strategies

The Organization of International Business

Marketing Globally

Global Manufacturing and Supply Chain Management

International Accounting Issues

The Multinational Finance Function

International Human Resources

Filters

Exam 6: International Trade and Factor Mobility Theory

All of the following are features of the diamond of national advantage theory EXCEPT ________.

The factor proportions theory holds that countries should concentrate production on those products that use their most abundant production factors.

Understanding trade theories helps companies know if they will need to compete against goods and services produced abroad.

According to the PLC theory,developing countries have their best production advantage in which stage of the product life cycle?

Which of the following is NOT a reason that international trade theory is useful for managers to understand?

Between now and 2050,countries undergoing a simultaneous population reduction and an increased percentage of retirees in the population most likely will need more ________.

According to the PLC theory,at an early stage of a product's life cycle the product is likely to be made in a more ________ method than in its later stages.

Which of the following undesirable results will most likely occur for a country running a favorable balance of trade?

The diamond of national advantage would be best used to answer which of the following questions?

All the following are reasons for the lower international mobility of people than capital EXCEPT which one?

In a short essay,discuss the theory of absolute advantage and the reasons a country's efficiency improves based on this theory.

Analysts conclude that the finite supply of natural resources will most likely ________.

Most world trade takes place ________.

Contrary to the product life cycle theory,there has been an increased tendency for companies to ________.

Which of the following is most likely a basis for a Jamaican natural advantage in international trade?

Under mercantilism,colonial powers sought to run trade surpluses with their colonies by preventing the colonies from manufacturing.

An exception to the PLC theory in terms of production location is often a product with very rapid change in innovation.

Trade occurs more between culturally dissimilar countries than between culturally similar countries.

In a short essay,discuss the four stages of the international product life cycle.

Why should managers in international business understand international trade theories?

Globalization and International Business

The Cultural Environments Facing Business

The Political and Legal Environments Facing Business

The Economic Environments Facing Businesses

Globalization and Society

Governmental Influence on Trade

Cross-National Cooperation and Agreements

Global Foreign-Exchange Markets

The Determination of Exchange Rates

The Strategy of International Business

Country Evaluation and Selection

Export and Import

Direct Investment and Collaborative Strategies

The Organization of International Business

Marketing Globally

Global Manufacturing and Supply Chain Management

International Accounting Issues

The Multinational Finance Function

International Human Resources

Filters