Exam 1: The International Economy and Globalization

____ is the ability of a firm/industry, under free and fair market conditions, to design, produce, and market goods and services that are better and/or cheaper than those of other firms/industries.

A feasible effect of international trade is that:

In the long run, competitiveness depends on an industry's natural resources, its stock of machinery and equipment, and the skill of its workers in creating goods that people want to buy.

If a nation has an open economy, it means that the nation:

The largest amount of trade with the United States in recent years has been conducted by:

If a nation has an open economy, it means that the nation allows private ownership of capital.

Free traders maintain that an open economy is advantageous in that it provides all of the following $\underline {\text { except }}$ :

A firm's ____, relative to that of other firms, is generally regarded as the most important determinant of competitiveness.

The real income of domestic producers and consumers can be increased by:

A closed economy is one in which:

Important trading partners of the United States include Canada, Mexico, Japan, and China.

Foreign ownership of U.S. financial assets

In an open trading system, a country will import those commodities that it produces at relatively low cost while exporting commodities that can be produced at relatively high cost.

Technological improvements are similar to international trade since they both:

International trade forces domestic firms to become more competitive in terms of:

Recent empirical studies indicate that productivity performance in industries is:

What is the most important factor which contributes to competitiveness?

Increased foreign competition tends to:

International trade in goods and services is sometimes used as a substitute for all of the following $\underline {\text { except }}$ :

Empirical research indicates that ____ best enhances productivity gains for firms and industries.