Question 1

The stock of FDI is the:

Accepted Answer

A)  amount of FDI undertaken over a given period of time. 
B)  total accumulated value of foreign-owned assets at a given time. 
C)  flow of FDI out of a country. 
D)  amount of foreign direct investment made by domestic companies over a given period of time. 
A)  amount of FDI undertaken over a given period of time. 
B)  total accumulated value of foreign-owned assets at a given time. 
C)  flow of FDI out of a country. 
D)  amount of foreign direct investment made by domestic companies over a given period of time.

Question 2

Mergers and acquisitions are quicker to execute than greenfield investments.

Accepted Answer

A) True 
 B)False

Question 3

Direct effects of FDI arise when jobs are created in local suppliers as a result of the FDI and when jobs are created because of increased local spending by employees of the MNE.

Accepted Answer

A) True 
 B)False

Question 4

According to pragmatic nationalist view, FDI should be allowed so long as:

Accepted Answer

A)  the benefits outweigh the costs. 
B)  they do not aggressively court domestic firms. 
C)  the costs outweigh the benefits. 
D)  the MNE does not seek tax breaks or grants. 
A)  the benefits outweigh the costs. 
B)  they do not aggressively court domestic firms. 
C)  the costs outweigh the benefits. 
D)  the MNE does not seek tax breaks or grants.

Question 5

What is the term that describes when two or more enterprises encounter each other in different regional markets, national markets, or industries?

Accepted Answer

A)  Multipoint competition 
B)  Monopoly 
C)  Location-specific competition 
D)  Oligopoly 
A)  Multipoint competition 
B)  Monopoly 
C)  Location-specific competition 
D)  Oligopoly

Question 6

Which of the following is a direct consequence of the interdependence between firms in an oligopoly?

Accepted Answer

A)  Increased regulation 
B)  Increased consumer welfare 
C)  Imitative behavior 
D)  Longer product life-cycles 
A)  Increased regulation 
B)  Increased consumer welfare 
C)  Imitative behavior 
D)  Longer product life-cycles

Question 7

A country's _____ keeps track of its payments to and its receipts from other countries.

Accepted Answer

A)  federal payments ledgers 
B)  concurrent accounts 
C)  checks-and-balances accounts 
D)  balance-of-payments accounts 
A)  federal payments ledgers 
B)  concurrent accounts 
C)  checks-and-balances accounts 
D)  balance-of-payments accounts

Question 8

How can FDI undertaken to serve the home market stimulate economic growth in the home country?

Accepted Answer

A)  By freeing home-country resources to concentrate on activities where the home country has a comparative advantage 
B)  By importing more goods and services than it is exporting 
C)  By circumventing trade barriers that may have prevented direct exports in the past 
D)  By reducing demand for home-country exports of capital equipment, intermediate goods, and complementary products 
A)  By freeing home-country resources to concentrate on activities where the home country has a comparative advantage 
B)  By importing more goods and services than it is exporting 
C)  By circumventing trade barriers that may have prevented direct exports in the past 
D)  By reducing demand for home-country exports of capital equipment, intermediate goods, and complementary products

Question 9

Discuss the two main forms of FDI.

Accepted Answer

FDI takes on two main forms. The first i

Question 10

Governments normally are concerned when their country is running a surplus on the current account of their balance of payments.

Accepted Answer

A) True 
 B)False

Question 11

Offshore production refers to FDI undertaken to serve the host market.

Accepted Answer

A) True 
 B)False

Question 12

Other things being equal, the greater the capital investment in an economy, the more favorable its future growth prospects are likely to be.

Accepted Answer

A) True 
 B)False

Question 13

A country's _____ keep track of both its payments to and its receipts from other countries.

Accepted Answer

A)  current accounts 
B)  offshore accounts 
C)  balance-of-payments accounts 
D)  currency accounts 
A)  current accounts 
B)  offshore accounts 
C)  balance-of-payments accounts 
D)  currency accounts

Question 14

The _____ and Knickerbocker's theory of FDI tend to be less useful from a business perspective because they are descriptive rather than analytical.

Accepted Answer

A)  noninterventionist theory 
B)  internalization theory 
C)  eclectic paradigm 
D)  product life-cycle theory 
A)  noninterventionist theory 
B)  internalization theory 
C)  eclectic paradigm 
D)  product life-cycle theory

Question 15

_____ argues that FDI is a benefit to both the source country and to the host country.

Accepted Answer

A)  Pragmatic nationalism 
B)  The free market view 
C)  The noninterventionist principle 
D)  The radical view 
A)  Pragmatic nationalism 
B)  The free market view 
C)  The noninterventionist principle 
D)  The radical view

Question 16

Describe the situations when licensing is not a good option for a firm.

Accepted Answer

Licensing is not a good option in three

Question 17

FDI can benefit the home country's _____ if the foreign subsidiary creates demands for home-country exports of capital equipment, intermediate goods, complementary products, and the like.

Accepted Answer

A)  balance of payments 
B)  oligopolistic industry 
C)  current accounts 
D)  licensing endeavors 
A)  balance of payments 
B)  oligopolistic industry 
C)  current accounts 
D)  licensing endeavors

Question 18

What are the ways in which host governments restrict inward FDI?

Accepted Answer

Host governments use a wide range of con

Question 19

John Dunning pioneered the eclectic paradigm.

Accepted Answer

A) True 
 B)False

Question 20

Licensing would be a good option for firms in which of the following industries?

Accepted Answer

A)  High-technology industries in which protecting firm-specific expertise is of paramount importance. 
B)  Global oligopolies, in which competitive interdependence requires that multinational firms maintain tight control over foreign operations. 
C)  Industries in which intense cost pressures require that multinational firms maintain tight control over foreign operations. 
D)  In fragmented, low-technology industries in which globally dispersed manufacturing is not an option. 
A)  High-technology industries in which protecting firm-specific expertise is of paramount importance. 
B)  Global oligopolies, in which competitive interdependence requires that multinational firms maintain tight control over foreign operations. 
C)  Industries in which intense cost pressures require that multinational firms maintain tight control over foreign operations. 
D)  In fragmented, low-technology industries in which globally dispersed manufacturing is not an option.

The stock of FDI is the:

Mergers and acquisitions are quicker to execute than greenfield investments.

Direct effects of FDI arise when jobs are created in local suppliers as a result of the FDI and when jobs are created because of increased local spending by employees of the MNE.

According to pragmatic nationalist view, FDI should be allowed so long as:

What is the term that describes when two or more enterprises encounter each other in different regional markets, national markets, or industries?

Which of the following is a direct consequence of the interdependence between firms in an oligopoly?

A country's _____ keeps track of its payments to and its receipts from other countries.

How can FDI undertaken to serve the home market stimulate economic growth in the home country?

Discuss the two main forms of FDI.

Governments normally are concerned when their country is running a surplus on the current account of their balance of payments.

Offshore production refers to FDI undertaken to serve the host market.

Other things being equal, the greater the capital investment in an economy, the more favorable its future growth prospects are likely to be.

A country's _____ keep track of both its payments to and its receipts from other countries.

The _____ and Knickerbocker's theory of FDI tend to be less useful from a business perspective because they are descriptive rather than analytical.

_____ argues that FDI is a benefit to both the source country and to the host country.

Describe the situations when licensing is not a good option for a firm.

FDI can benefit the home country's _____ if the foreign subsidiary creates demands for home-country exports of capital equipment, intermediate goods, complementary products, and the like.

What are the ways in which host governments restrict inward FDI?

John Dunning pioneered the eclectic paradigm.

Licensing would be a good option for firms in which of the following industries?

Globalization

National Differences in Political Economy, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Government Policy and International Trade

Regional Trade Pacts Give the Mexican Auto Industry an Edge

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and RD

Global Human Resource Management

Accounting and Finance in the International Business

Filters

Exam 8: Foreign Direct Investment

The stock of FDI is the:

Mergers and acquisitions are quicker to execute than greenfield investments.

Direct effects of FDI arise when jobs are created in local suppliers as a result of the FDI and when jobs are created because of increased local spending by employees of the MNE.

According to pragmatic nationalist view, FDI should be allowed so long as:

What is the term that describes when two or more enterprises encounter each other in different regional markets, national markets, or industries?

Which of the following is a direct consequence of the interdependence between firms in an oligopoly?

A country's _____ keeps track of its payments to and its receipts from other countries.

How can FDI undertaken to serve the home market stimulate economic growth in the home country?

Discuss the two main forms of FDI.

Governments normally are concerned when their country is running a surplus on the current account of their balance of payments.

Offshore production refers to FDI undertaken to serve the host market.

Other things being equal, the greater the capital investment in an economy, the more favorable its future growth prospects are likely to be.

A country's _____ keep track of both its payments to and its receipts from other countries.

The _____ and Knickerbocker's theory of FDI tend to be less useful from a business perspective because they are descriptive rather than analytical.

_____ argues that FDI is a benefit to both the source country and to the host country.

Describe the situations when licensing is not a good option for a firm.

FDI can benefit the home country's _____ if the foreign subsidiary creates demands for home-country exports of capital equipment, intermediate goods, complementary products, and the like.

What are the ways in which host governments restrict inward FDI?

John Dunning pioneered the eclectic paradigm.

Licensing would be a good option for firms in which of the following industries?

Globalization

National Differences in Political Economy, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Government Policy and International Trade

Regional Trade Pacts Give the Mexican Auto Industry an Edge

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and RD

Global Human Resource Management

Accounting and Finance in the International Business

Filters