Exam 6: International Trade and Investment

According to internalization theory, firms are more likely to license their brand names when transaction costs are high.

The most important source of FDI for the United States is ________.

International investment theories answer the question, "Why does foreign direct investment occur?"

The term ________ refers to the voluntary exchange of goods, services, assets, or money between one person or organization and another.

In the ________ stage of the international product life cycle, the product becomes commodity-like and price becomes very important.

Leontief found that the United States was producing and exporting capital-intensive goods.

Firm-based theories of international trade are best at explaining trade in all of the following types of products except ________.

What is the key difference between the theory of comparative advantage and the theory of absolute advantage? Which theory do you support? Why?

According to Porter, agglomeration economies lead to all of the following EXCEPT ________.

Which of the following is not one of the four elements discussed in the theory of national competitive advantage?

Which theory explains why a firm would choose to enter a foreign market via FDI rather than exploit its ownership advantages internationally through other means?

What are the indirect effects of international trade? How do exports spark economic activity in a country?

China is one of the primary recipients of FDI from the United States.

What are the primary forms of international business?

What is the primary focus of the new trade theory developed by Krugman, Helpman, and Lancaster?

Executives at Energex Enterprises are trying to determine whether it would be better to own and operate a factory overseas or to contract with a foreign firm to do this through a licensing agreement. Which theory would most likely help the Energex executives make this decision?

Adam Smith attacked the intellectual basis of mercantilism in 1776.

What is the most likely characteristic of a firm that gains a first-mover advantage?

Who developed the theory of national competitive advantage?

In which stage of the international product life cycle does the innovating firm's country become a net importer of the product?