Question 1

In the context of international trade, which of the following statements is true of comparative advantage?

Accepted Answer

A) It is the tendency of a country to choose goods that have a higher opportunity cost compared to other countries. 
B) As technology changes, nations may gain or lose comparative advantage in various industries. 
C) It is subjected to the industries in developing countries facing major trade barriers. 
D) Despite evolving workforces, developing countries maintain a static comparative advantage. 
A) It is the tendency of a country to choose goods that have a higher opportunity cost compared to other countries. 
B) As technology changes, nations may gain or lose comparative advantage in various industries. 
C) It is subjected to the industries in developing countries facing major trade barriers. 
D) Despite evolving workforces, developing countries maintain a static comparative advantage.

Question 2

Brestine Inc., a European multinational corporation, wants to expand its customer base and decides to target the Asian market. As most Asian countries have comparatively low per capita income, the company introduces cheaper versions of its products that would appeal to the target market. In this scenario, Brestine Inc. is most likely facing the barrier of _____.

Accepted Answer

A) sociocultural differences 
B) political differences 
C) economic differences 
D) legal differences 
A) sociocultural differences 
B) political differences 
C) economic differences 
D) legal differences

Question 3

Resorto, a European country, exported sugar worth $600 million between 2015 and 2016 and imported tea worth $750 million during the same period. In this scenario, Resorto most likely had a _____ between 2015 and 2016.

Accepted Answer

A) trade deficit 
B) balance of payments surplus 
C) trade surplus 
D) balance of payments deficit 
A) trade deficit 
B) balance of payments surplus 
C) trade surplus 
D) balance of payments deficit

Question 4

In the context of competitive advantage, the value of the first-best choice represents the opportunity cost of producing a second product.

Accepted Answer

A) True 
 B)False

Question 5

Luchen Modo, a software development firm in Asia, launched a new software for smartphones that allowed users to remotely control certain functions and features of their vehicles, such as ignition, windshields, and headlights. The success of this technology prompted other companies across the world to produce similar software. In this scenario, which of the following is most likely to have influenced other companies to produce similar software?

Accepted Answer

A) Establishment of new industries 
B) Inflow of innovation 
C) Access to factors of production 
D) Reduced risk 
A) Establishment of new industries 
B) Inflow of innovation 
C) Access to factors of production 
D) Reduced risk

Question 6

Vertiaplume, a drug manufacturing company, exports its products to more than 15 countries around the world. Regardless of reduced sales in one of these countries, Vertiaplume is able to maintain its overall profits. In the given scenario, which of the following is a reason behind Vertiaplume's ability to maintain its overall profits?

Accepted Answer

A) Access to factors of production 
B) Ease of storage of goods 
C) Inflow of innovation 
D) Reduced risk 
A) Access to factors of production 
B) Ease of storage of goods 
C) Inflow of innovation 
D) Reduced risk

Question 7

Despite their huge populations, China and India represent a much smaller opportunity in terms of size and economic growth.

Accepted Answer

A) True 
 B)False

Question 8

A firm that contracts with foreign producers has an obligation to ensure that those factories adhere to ethical standards.

Accepted Answer

A) True 
 B)False

Question 9

Nersina, a European country, exports petroleum and imports cotton and jute. In the current fiscal year, the total value of Nersina's exports is higher than the total value of its imports. In this scenario, Nersina most likely has a _____.

Accepted Answer

A) balance of payments surplus 
B) trade deficit 
C) balance of payments deficit 
D) trade surplus 
A) balance of payments surplus 
B) trade deficit 
C) balance of payments deficit 
D) trade surplus

Question 10

Tanya Williams, the chief executive officer of Willister Computers, believes that the firm is currently best equipped to enter the market of Troyesna, a fast-developing country. The firm offers a small-scale producer in Tryoesna the right to produce and market its goods based on a set of specific operating functions and requirements. This scenario of Willister Computers illustrates _____.

Accepted Answer

A) foreign franchising 
B) direct investment 
C) a strategic alliance 
D) a joint venture 
A) foreign franchising 
B) direct investment 
C) a strategic alliance 
D) a joint venture

Question 11

In the context of international trade, often countries with the highest trade barriers have the least competition.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following countries is involved in countertrade?

Accepted Answer

A) An Asian country that imports cotton from an African country and resells it to other countries 
B) A North American country that experiences more cash outflow than inflow 
C) An Asian country that provides sugarcane to an African country in exchange for jute 
D) A European country whose total value of exports is higher than its imports 
A) An Asian country that imports cotton from an African country and resells it to other countries 
B) A North American country that experiences more cash outflow than inflow 
C) An Asian country that provides sugarcane to an African country in exchange for jute 
D) A European country whose total value of exports is higher than its imports

Question 13

In the context of international trade, India, China, and the Philippines attract multibillion-dollar investments because:

Accepted Answer

A) they are more developed than any other developed country in the world. 
B) they have a large cohort of technically skilled university graduates who work for about one-fifth the pay of comparable American workers. 
C) the value of euro is lower in the Asian market than in the American market. 
D) the level of risk associated with establishing business relationships with firms belonging to the Asian market is minimal. 
A) they are more developed than any other developed country in the world. 
B) they have a large cohort of technically skilled university graduates who work for about one-fifth the pay of comparable American workers. 
C) the value of euro is lower in the Asian market than in the American market. 
D) the level of risk associated with establishing business relationships with firms belonging to the Asian market is minimal.

Question 14

Nescat Autos, an automobile manufacturing company, developed a secondary market for its products in a foreign country. This allowed the company to minimize its losses when its primary market failed to generate enough revenue to benefit the company. In this scenario, which of the following is most likely to have influenced Nescat Autos's decision to set up a market in another country?

Accepted Answer

A) Inflow of innovation 
B) Reduced risk 
C) Access to factors of production 
D) Growth of domestic industries 
A) Inflow of innovation 
B) Reduced risk 
C) Access to factors of production 
D) Growth of domestic industries

Question 15

Which of the following statements is true of international trade?

Accepted Answer

A) It increases a firm's dependence on its domestic economy. 
B) It offers companies an invaluable source of new ideas. 
C) It increases the economic risk for multinational companies. 
D) It reduces a firm's opportunity to tap into growing new markets. 
A) It increases a firm's dependence on its domestic economy. 
B) It offers companies an invaluable source of new ideas. 
C) It increases the economic risk for multinational companies. 
D) It reduces a firm's opportunity to tap into growing new markets.

Question 16

Elision Inc., an American software development company, outsourced its support operations to Luzenza, an Asian nation, because it found that Luzenza has a large cohort of English-speaking college graduates who are ready to work for one-fourth the pay of comparable American workers. Which of the following is most likely to have influenced Elision Inc.'s decision to outsource its support operations to Luzenza?

Accepted Answer

A) Inflow of innovation 
B) Growth of domestic industries 
C) Reduced risk 
D) Access to factors of production 
A) Inflow of innovation 
B) Growth of domestic industries 
C) Reduced risk 
D) Access to factors of production

Question 17

The basic mission of the _____ is to promote global economic cooperation and stable growth.

Accepted Answer

A) World Bank 
B) World Trade Organization 
C) International Monetary Fund 
D) General Agreement on Tariffs and Trade 
A) World Bank 
B) World Trade Organization 
C) International Monetary Fund 
D) General Agreement on Tariffs and Trade

Question 18

In foreign licensing, licensors run the risk that unethical licensees may become their competitors, using information that they gained from the licensing agreement.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following countries most likely has a comparative advantage?

Accepted Answer

A) A South American country that produces more coffee compared to an Asian country despite having equal resources 
B) An Asian country that manufactures more textile products than most countries by decreasing its production of tea 
C) An Asian country that produces quality automobiles with little opportunity cost compared to other countries 
D) A North American country that expands its trade relations to a neighboring country to share resources 
A) A South American country that produces more coffee compared to an Asian country despite having equal resources 
B) An Asian country that manufactures more textile products than most countries by decreasing its production of tea 
C) An Asian country that produces quality automobiles with little opportunity cost compared to other countries 
D) A North American country that expands its trade relations to a neighboring country to share resources

Question 20

Compared to the United States, China and India have:

Accepted Answer

A) smaller market size. 
B) higher gross domestic product growth rates. 
C) higher per capita gross domestic products. 
D) lower population. 
A) smaller market size. 
B) higher gross domestic product growth rates. 
C) higher per capita gross domestic products. 
D) lower population.

In the context of international trade, which of the following statements is true of comparative advantage?

Resorto, a European country, exported sugar worth $600 million between 2015 and 2016 and imported tea worth $750 million during the same period. In this scenario, Resorto most likely had a _____ between 2015 and 2016.

In the context of competitive advantage, the value of the first-best choice represents the opportunity cost of producing a second product.

Despite their huge populations, China and India represent a much smaller opportunity in terms of size and economic growth.

A firm that contracts with foreign producers has an obligation to ensure that those factories adhere to ethical standards.

Nersina, a European country, exports petroleum and imports cotton and jute. In the current fiscal year, the total value of Nersina's exports is higher than the total value of its imports. In this scenario, Nersina most likely has a _____.

In the context of international trade, often countries with the highest trade barriers have the least competition.

Which of the following countries is involved in countertrade?

In the context of international trade, India, China, and the Philippines attract multibillion-dollar investments because:

Which of the following statements is true of international trade?

The basic mission of the _____ is to promote global economic cooperation and stable growth.

In foreign licensing, licensors run the risk that unethical licensees may become their competitors, using information that they gained from the licensing agreement.

Which of the following countries most likely has a comparative advantage?

Compared to the United States, China and India have:

Business Now: Change Is the Only Constant

Economics: the Framework for Business

Business Ethics and Social Responsibility: Doing Well by Doing Good

Business Communication: Creating and Delivering Messages That Matter

Business Formation: Choosing the Form That Fits

Small Business and Entrepreneurship: Economic Rocket Fuel

Accounting: Decision Making by the Numbers

Finance: Acquiring and Using Funds to Maximize Value

Financial Markets: Allocating Financial Resources

Marketing: Building Profitable Customer Connections

Product and Promotion: Creating and Communicating Value

Distribution and Pricing: Right Product Right Person Right Place Right Price

Management Motivation and Leadership: Bringing Business to Life

Human Resource Management: Building a Top-Quality Workforce

Managing Information and Technology: Finding New Ways to Learn and Link

Operations Management: Putting It All Together

Appendix: Personal Finance

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Exam 3: The World Marketplace: Business Without Borders

In the context of international trade, which of the following statements is true of comparative advantage?

Resorto, a European country, exported sugar worth $600 million between 2015 and 2016 and imported tea worth $750 million during the same period. In this scenario, Resorto most likely had a _____ between 2015 and 2016.

In the context of competitive advantage, the value of the first-best choice represents the opportunity cost of producing a second product.

Despite their huge populations, China and India represent a much smaller opportunity in terms of size and economic growth.

A firm that contracts with foreign producers has an obligation to ensure that those factories adhere to ethical standards.

Nersina, a European country, exports petroleum and imports cotton and jute. In the current fiscal year, the total value of Nersina's exports is higher than the total value of its imports. In this scenario, Nersina most likely has a _____.

In the context of international trade, often countries with the highest trade barriers have the least competition.

Which of the following countries is involved in countertrade?

In the context of international trade, India, China, and the Philippines attract multibillion-dollar investments because:

Which of the following statements is true of international trade?

The basic mission of the _____ is to promote global economic cooperation and stable growth.

In foreign licensing, licensors run the risk that unethical licensees may become their competitors, using information that they gained from the licensing agreement.

Which of the following countries most likely has a comparative advantage?

Compared to the United States, China and India have:

Business Now: Change Is the Only Constant

Economics: the Framework for Business

Business Ethics and Social Responsibility: Doing Well by Doing Good

Business Communication: Creating and Delivering Messages That Matter

Business Formation: Choosing the Form That Fits

Small Business and Entrepreneurship: Economic Rocket Fuel

Accounting: Decision Making by the Numbers

Finance: Acquiring and Using Funds to Maximize Value

Financial Markets: Allocating Financial Resources

Marketing: Building Profitable Customer Connections

Product and Promotion: Creating and Communicating Value

Distribution and Pricing: Right Product Right Person Right Place Right Price

Management Motivation and Leadership: Bringing Business to Life

Human Resource Management: Building a Top-Quality Workforce

Managing Information and Technology: Finding New Ways to Learn and Link

Operations Management: Putting It All Together

Appendix: Personal Finance

Filters