Question 1

Which of the following is an argument offered by the new trade theory?

Accepted Answer

A) It is in line with the factor proportions theory. 
B) There are gains to be made from specialization and increasing economies of scale. 
C) The companies first to market forgo the opportunities to create barriers to entry. 
D) Market forces alone play a role in assisting the home companies in a country. 
A) It is in line with the factor proportions theory. 
B) There are gains to be made from specialization and increasing economies of scale. 
C) The companies first to market forgo the opportunities to create barriers to entry. 
D) Market forces alone play a role in assisting the home companies in a country.

Question 2

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 3

The ________ theory states that a country's export eventually becomes its import.

Accepted Answer

A) competitive advantage 
B) factor proportions 
C) international product life cycle 
D) new trade 
A) competitive advantage 
B) factor proportions 
C) international product life cycle 
D) new trade

Question 4

Discuss the dangers of trade dependency.

Accepted Answer

The dangers of trade dependency become a

Question 5

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

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 believes that his business has grown because of his personal involvement in every step of the way.What advice do you offer Chuck as he continues to expand his business in new Asian markets?

Accepted Answer

A) Contact distributors directly to avoid misunderstandings that can arise when using third-party contacts. 
B) Always stick to corporate settings when doing business to avoid misunderstandings that can arise in less formal environments. 
C) Protect your interests by insisting on detailed contracts from the start. 
D) Use proper intermediaries as required in Pacific Rim nations. 
A) Contact distributors directly to avoid misunderstandings that can arise when using third-party contacts. 
B) Always stick to corporate settings when doing business to avoid misunderstandings that can arise in less formal environments. 
C) Protect your interests by insisting on detailed contracts from the start. 
D) Use proper intermediaries as required in Pacific Rim nations.

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

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 9

Economist David Ricardo developed the theory of comparative advantage.

Accepted Answer

A) True 
 B)False

Question 10

International trade is the purchase,sale,or exchange of goods and services across national borders.

Accepted Answer

A) True 
 B)False

Question 11

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 12

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 13

The value of trade passing through the borders of all countries exceeds the amount of goods and services they produce.

Accepted Answer

A) True 
 B)False

Question 14

Explain how the national competitive advantage theory supports and builds upon the factor proportions theory.

Accepted Answer

The factor proportions theory is an inte

Question 15

Today,countries seen by others as trying to maintain a trade surplus and expand their national treasures at the expense of other nations are accused of practicing ________.

Accepted Answer

A) totalitarianism 
B) anti-mercantilism 
C) social stratification 
D) economic nationalism 
A) totalitarianism 
B) anti-mercantilism 
C) social stratification 
D) economic nationalism

Question 16

Who proposed the theory of absolute advantage?

Accepted Answer

A) David Ricardo 
B) Adam Smith 
C) Bertil Ohlin 
D) Raymond Vernon 
A) David Ricardo 
B) Adam Smith 
C) Bertil Ohlin 
D) Raymond Vernon

Question 17

Which of the following is an assumption made by the comparative advantage theory?

Accepted Answer

A) maximization of production and consumption 
B) government interference and control in trade activities 
C) creation of trade deficits 
D) creation of trade surpluses 
A) maximization of production and consumption 
B) government interference and control in trade activities 
C) creation of trade deficits 
D) creation of trade surpluses

Question 18

Explain how both the international product life cycle theory and the new trade theory ultimately result in lower priced goods.Include a definition of "first mover advantage" in your answer.

Accepted Answer

The international product life cycle the

Question 19

Factor proportions theory differs from the theory of comparative advantage in that the focus of factor proportions theory is on the ________.

Accepted Answer

A) usage of the most abundant factors of production,while the focus of the comparative advantage theory is on the productivity of the production process 
B) accumulation of financial wealth in the form of gold by encouraging imports and discouraging exports,while the comparative advantage theory focuses on usage of the most abundant factors of production 
C) productivity of the production process,while the comparative advantage theory focuses on maximization of production and consumption 
D) minimization of trade surpluses,whereas the comparative advantage theory focuses on the mercantilist idea that international trade is a zero-sum game 
A) usage of the most abundant factors of production,while the focus of the comparative advantage theory is on the productivity of the production process 
B) accumulation of financial wealth in the form of gold by encouraging imports and discouraging exports,while the comparative advantage theory focuses on usage of the most abundant factors of production 
C) productivity of the production process,while the comparative advantage theory focuses on maximization of production and consumption 
D) minimization of trade surpluses,whereas the comparative advantage theory focuses on the mercantilist idea that international trade is a zero-sum game

Question 20

Which of the following statements is incorrect with regard to the importance of colonies for mercantilist nations?

Accepted Answer

A) They served as sources of inexpensive raw materials. 
B) They served as markets for higher-priced finished goods. 
C) They served as a source of military protection. 
D) They served as a source of profits for mercantilist powers. 
A) They served as sources of inexpensive raw materials. 
B) They served as markets for higher-priced finished goods. 
C) They served as a source of military protection. 
D) They served as a source of profits for mercantilist powers.

Which of the following is an argument offered by the new trade theory?

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

The ________ theory states that a country's export eventually becomes its import.

Discuss the dangers of trade dependency.

The danger of trade dependency is that ________.

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

Economist David Ricardo developed the theory of comparative advantage.

International trade is the purchase,sale,or exchange of goods and services across national borders.

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

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

The value of trade passing through the borders of all countries exceeds the amount of goods and services they produce.

Explain how the national competitive advantage theory supports and builds upon the factor proportions theory.

Today,countries seen by others as trying to maintain a trade surplus and expand their national treasures at the expense of other nations are accused of practicing ________.

Who proposed the theory of absolute advantage?

Which of the following is an assumption made by the comparative advantage theory?

Explain how both the international product life cycle theory and the new trade theory ultimately result in lower priced goods.Include a definition of "first mover advantage" in your answer.

Factor proportions theory differs from the theory of comparative advantage in that the focus of factor proportions theory is on the ________.

Which of the following statements is incorrect with regard to the importance of colonies for mercantilist nations?

Globalization

Cross-Cultural Business

Political Economy and Ethics

Economic Development of Nations

Political Economy of Trade

Foreign Direct Investment

Regional Economic Integration

International Financial Markets

International Monetary 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 Theory

Which of the following is an argument offered by the new trade theory?

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

The ________ theory states that a country's export eventually becomes its import.

Discuss the dangers of trade dependency.

The danger of trade dependency is that ________.

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

Economist David Ricardo developed the theory of comparative advantage.

International trade is the purchase,sale,or exchange of goods and services across national borders.

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

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

The value of trade passing through the borders of all countries exceeds the amount of goods and services they produce.

Explain how the national competitive advantage theory supports and builds upon the factor proportions theory.

Today,countries seen by others as trying to maintain a trade surplus and expand their national treasures at the expense of other nations are accused of practicing ________.

Who proposed the theory of absolute advantage?

Which of the following is an assumption made by the comparative advantage theory?

Explain how both the international product life cycle theory and the new trade theory ultimately result in lower priced goods.Include a definition of "first mover advantage" in your answer.

Factor proportions theory differs from the theory of comparative advantage in that the focus of factor proportions theory is on the ________.

Which of the following statements is incorrect with regard to the importance of colonies for mercantilist nations?

Globalization

Cross-Cultural Business

Political Economy and Ethics

Economic Development of Nations

Political Economy of Trade

Foreign Direct Investment

Regional Economic Integration

International Financial Markets

International Monetary 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