Question 1

Adam Smith believed that ________.

Accepted Answer

A) governments should determine trade flows 
B) market forces should determine trade flows 
C) international trade should be restricted by tariffs and quotas 
D) countries should produce most goods themselves and trade as little as possible 
A) governments should determine trade flows 
B) market forces should determine trade flows 
C) international trade should be restricted by tariffs and quotas 
D) countries should produce most goods themselves and trade as little as possible

Question 2

The condition that results when the value of a country's imports is greater than the value of its exports is called ________.

Accepted Answer

A) a trade deficit 
B) economies of scale 
C) a break-even point 
D) absolute advantage 
A) a trade deficit 
B) economies of scale 
C) a break-even point 
D) absolute advantage

Question 3

According to Michael Porter,advanced factors account for the sustained competitive advantage a country enjoys in a product.

Accepted Answer

A) True 
 B)False

Question 4

The measures of a nation's well-being other than the financial wealth accumulated through exports are irrelevant according to ________.

Accepted Answer

A) mercantilism 
B) absolute advantage theory 
C) factor proportions theory 
D) new trade theory 
A) mercantilism 
B) absolute advantage theory 
C) factor proportions theory 
D) new trade theory

Question 5

Scenario: Chuck Praeger,Global Entrepreneur
Chuck Praeger has made a name for himself by selling high-quality golf equipment to customers in Europe.He would like to expand his business into the Pacific Rim countries and has therefore,begun making inquiries into potential distributors.
-Chuck is convinced that his golf equipment will sell itself.But he is preparing a special presentation for Asian customers because he wants to make a good first impression.As an expert in culture of the Pacific Rim countries,which of the following would be your most likely advice to Chuck?

Accepted Answer

A) Be sure to have a tight legal contract ready,to avoid product piracy problems. 
B) Aggressive salesmanship is unlikely to work in Pacific Rim countries. 
C) Have plenty of English-language business cards to pass around because most Asians know English and like the language. 
D) Avoid the confusion introduced by third-party contacts. 
A) Be sure to have a tight legal contract ready,to avoid product piracy problems. 
B) Aggressive salesmanship is unlikely to work in Pacific Rim countries. 
C) Have plenty of English-language business cards to pass around because most Asians know English and like the language. 
D) Avoid the confusion introduced by third-party contacts.

Question 6

Mercantilism states that nations should only concern themselves with accumulating financial wealth.

Accepted Answer

A) True 
 B)False

Question 7

The danger of trade dependency is that ________.

Accepted Answer

A) it often leads to the exploitation of developed countries 
B) political turmoils in a country might affect all dependent countries 
C) the countries involved in trade often get into rivalry over trade tariff issues 
D) it is difficult to end trade activities with current trade partners and find new trade partners 
A) it often leads to the exploitation of developed countries 
B) political turmoils in a country might affect all dependent countries 
C) the countries involved in trade often get into rivalry over trade tariff issues 
D) it is difficult to end trade activities with current trade partners and find new trade partners

Question 8

Which of the following is true about the theory of absolute advantage?

Accepted Answer

A) The theory accepts the mercantilist idea that international trade is a zero-sum game. 
B) The theory approves the objective of national governments to acquire wealth through restrictive trade policies. 
C) The theory emphasizes that nations should open their doors to trade so that people can obtain more goods at cheaper rates. 
D) The theory measures a nation's wealth by how much gold and silver it has on reserve. 
A) The theory accepts the mercantilist idea that international trade is a zero-sum game. 
B) The theory approves the objective of national governments to acquire wealth through restrictive trade policies. 
C) The theory emphasizes that nations should open their doors to trade so that people can obtain more goods at cheaper rates. 
D) The theory measures a nation's wealth by how much gold and silver it has on reserve.

Question 9

Which of the following refers to the ability of a nation to produce a good more efficiently than any other nation?

Accepted Answer

A) mercantilism 
B) comparative advantage 
C) absolute advantage 
D) neomercantilism 
A) mercantilism 
B) comparative advantage 
C) absolute advantage 
D) neomercantilism

Question 10

The theories of comparative advantage and absolute advantage assume that countries are driven only by the maximization of production and consumption.

Accepted Answer

A) True 
 B)False

Question 11

Discuss the three essential pillars of the theory of mercantilism.

Accepted Answer

The trade theory that nations should acc

Question 12

According to Adam Smith,international trade should be restricted by tariffs and quotas in order to give a country an absolute advantage.

Accepted Answer

A) True 
 B)False

Question 13

During which stage of the product life cycle are companies looking for low-cost production bases in developing nations to supply a growing worldwide market?

Accepted Answer

A) product decline stage 
B) new product stage 
C) maturing product stage 
D) standardized product stage 
A) product decline stage 
B) new product stage 
C) maturing product stage 
D) standardized product stage

Question 14

Scenario: Foodland and Drinkland
Two countries,Foodland and Drinkland,produce food and drinks.In Foodland,one resource unit produces 20 tons of food and one resource unit produces 10 tons of drinks.In Drinkland,one resource unit produces 12 tons of food and one resource unit produces 24 tons of drinks.
Food Drinks
Foodland 20 10
Drinkland 12 24
-If these two countries were to gain from trading with each other,this would support the notion that trade is a ________.

Accepted Answer

A) zero-sum game 
B) negative experience 
C) positive-sum game 
D) form of economic nationalism 
A) zero-sum game 
B) negative experience 
C) positive-sum game 
D) form of economic nationalism

Question 15

Scenario: Better Mousetrap Inc.
Better Mousetrap Inc.is a manufacturing company that sells pest control products.Recently the company launched an innovative mousetrap with a unique design that has been selling well in the U.S.market.Senior Vice President Marc Wallace,even recommended expanding sales overseas in order to increase company revenues.
-Wallace's executive team reviews the stages of the international product life cycle to understand better what to expect when the product is sold overseas.Since there is virtually no export market for the product at present,the product is most likely in which of the following stages of the international product life cycle?

Accepted Answer

A) maturing product stage 
B) new product stage 
C) product decline stage 
D) standardized product stage 
A) maturing product stage 
B) new product stage 
C) product decline stage 
D) standardized product stage

Question 16

Which of the following was a prominent mercantilist nation?

Accepted Answer

A) U)S. 
B) China 
C) Britain 
D) Japan 
A) U)S. 
B) China 
C) Britain 
D) Japan

Question 17

The factor proportions theory of international trade was developed by Wassily Leontief.

Accepted Answer

A) True 
 B)False

Question 18

According to the Porter diamond,which of the following is an example of an advanced factor?

Accepted Answer

A) labor forces in the nation 
B) technological infrastructure in the nation 
C) climate in the nation 
D) natural resources in the nation 
A) labor forces in the nation 
B) technological infrastructure in the nation 
C) climate in the nation 
D) natural resources in the nation

Question 19

According to mercantilism,the accumulation of national wealth depended on the ________.

Accepted Answer

A) increase in a nation's trade surplus 
B) increase in a nation's trade deficit 
C) expansion of a nation's total value of trade 
D) expansion of a nation's total volume of trade 
A) increase in a nation's trade surplus 
B) increase in a nation's trade deficit 
C) expansion of a nation's total value of trade 
D) expansion of a nation's total volume of trade

Question 20

Most of the world merchandise trade is composed of trade in ________.

Accepted Answer

A) minerals 
B) services 
C) manufactured goods 
D) agricultural products 
A) minerals 
B) services 
C) manufactured goods 
D) agricultural products

Adam Smith believed that ________.

The condition that results when the value of a country's imports is greater than the value of its exports is called ________.

According to Michael Porter,advanced factors account for the sustained competitive advantage a country enjoys in a product.

The measures of a nation's well-being other than the financial wealth accumulated through exports are irrelevant according to ________.

Mercantilism states that nations should only concern themselves with accumulating financial wealth.

The danger of trade dependency is that ________.

Which of the following is true about the theory of absolute advantage?

Which of the following refers to the ability of a nation to produce a good more efficiently than any other nation?

The theories of comparative advantage and absolute advantage assume that countries are driven only by the maximization of production and consumption.

Discuss the three essential pillars of the theory of mercantilism.

According to Adam Smith,international trade should be restricted by tariffs and quotas in order to give a country an absolute advantage.

During which stage of the product life cycle are companies looking for low-cost production bases in developing nations to supply a growing worldwide market?

Which of the following was a prominent mercantilist nation?

The factor proportions theory of international trade was developed by Wassily Leontief.

According to the Porter diamond,which of the following is an example of an advanced factor?

According to mercantilism,the accumulation of national wealth depended on the ________.

Most of the world merchandise trade is composed of trade in ________.

Globalization

Cross-Cultural Business

Politics, Law, and Business Ethics

Economics and Emerging Markets

Business-Government Trade Relations

Foreign Direct Investment

Regional Economic Integration

International Financial Markets

International Money System

International Strategy and Organization

Analyzing International Opportunities

Selecting and Managing Entry Modes

Developing and Marketing Products

Managing International Operations

Hiring and Managing Employees

Filters

Exam 5: International Trade

Adam Smith believed that ________.

The condition that results when the value of a country's imports is greater than the value of its exports is called ________.

According to Michael Porter,advanced factors account for the sustained competitive advantage a country enjoys in a product.

The measures of a nation's well-being other than the financial wealth accumulated through exports are irrelevant according to ________.

Mercantilism states that nations should only concern themselves with accumulating financial wealth.

The danger of trade dependency is that ________.

Which of the following is true about the theory of absolute advantage?

Which of the following refers to the ability of a nation to produce a good more efficiently than any other nation?

The theories of comparative advantage and absolute advantage assume that countries are driven only by the maximization of production and consumption.

Discuss the three essential pillars of the theory of mercantilism.

According to Adam Smith,international trade should be restricted by tariffs and quotas in order to give a country an absolute advantage.

During which stage of the product life cycle are companies looking for low-cost production bases in developing nations to supply a growing worldwide market?

Which of the following was a prominent mercantilist nation?

The factor proportions theory of international trade was developed by Wassily Leontief.

According to the Porter diamond,which of the following is an example of an advanced factor?

According to mercantilism,the accumulation of national wealth depended on the ________.

Most of the world merchandise trade is composed of trade in ________.

Globalization

Cross-Cultural Business

Politics, Law, and Business Ethics

Economics and Emerging Markets

Business-Government Trade Relations

Foreign Direct Investment

Regional Economic Integration

International Financial Markets

International Money System

International Strategy and Organization

Analyzing International Opportunities

Selecting and Managing Entry Modes

Developing and Marketing Products

Managing International Operations

Hiring and Managing Employees

Filters