Question 1

A company that sells its product in a foreign market below the cost of production may be accused of _____.

Accepted Answer

A)  pandering 
B)  profiteering 
C)  carnivorous behavior 
D)  dumping 
A)  pandering 
B)  profiteering 
C)  carnivorous behavior 
D)  dumping

Question 2

Which of the following is a political reason for governments to intervene in markets?

Accepted Answer

A)  To help citizens obtain jobs in foreign markets 
B)  To aid their country's businesses in foreign markets 
C)  To subsidize multinational companies 
D)  To protect jobs and industries 
A)  To help citizens obtain jobs in foreign markets 
B)  To aid their country's businesses in foreign markets 
C)  To subsidize multinational companies 
D)  To protect jobs and industries

Question 3

According to the Buy America Act, if a company wishes to win a contract from a U.S. government agency to provide some equipment, it must ensure that at least 51 percent of the product by value is manufactured in the United States. This is an example of:

Accepted Answer

A)  antidumping duties. 
B)  voluntary export restraints. 
C)  import quotas. 
D)  local content requirements. 
A)  antidumping duties. 
B)  voluntary export restraints. 
C)  import quotas. 
D)  local content requirements.

Question 4

The threat of _____ limits the ability of a firm to use aggressive pricing to gain market share in a country.

Accepted Answer

A)  specific tariffs 
B)  import quotas 
C)  countervailing duties 
D)  antidumping action 
A)  specific tariffs 
B)  import quotas 
C)  countervailing duties 
D)  antidumping action

Question 5

The WTO's GATS has taken the lead to:

Accepted Answer

A)  provide enhanced protection for intellectual property. 
B)  extend free trade agreements to services. 
C)  reduce agricultural subsidies. 
D)  enforce GATT rules. 
A)  provide enhanced protection for intellectual property. 
B)  extend free trade agreements to services. 
C)  reduce agricultural subsidies. 
D)  enforce GATT rules.

Question 6

Antidumping duties are often called:

Accepted Answer

A)  special circumstance duties. 
B)  positive duties. 
C)  retroactive duties. 
D)  countervailing duties. 
A)  special circumstance duties. 
B)  positive duties. 
C)  retroactive duties. 
D)  countervailing duties.

Question 7

According to the strategic trade policy argument:

Accepted Answer

A)  government intervention is not required because firms can borrow money from the capital markets to finance the required investments. 
B)  selling goods in a foreign market at below their "fair" market value is legally and ethically justified. 
C)  government support can help domestic firms overcome the first-mover advantages enjoyed by foreign competitors. 
D)  a government should use subsidies to support promising firms that are active in old, established industries. 
A)  government intervention is not required because firms can borrow money from the capital markets to finance the required investments. 
B)  selling goods in a foreign market at below their "fair" market value is legally and ethically justified. 
C)  government support can help domestic firms overcome the first-mover advantages enjoyed by foreign competitors. 
D)  a government should use subsidies to support promising firms that are active in old, established industries.

Question 8

In 1997, two South Korean manufacturers of semiconductors, LG Semicon and Hyundai Electronics, were accused of selling dynamic random access memory chips (DRAMs) in the U.S. market at below their costs of production. It was alleged that the firms were trying to unload their excess production in the United States. This is an example of:

Accepted Answer

A)  ad valorem tariff. 
B)  subsidy. 
C)  dumping. 
D)  import quota. 
A)  ad valorem tariff. 
B)  subsidy. 
C)  dumping. 
D)  import quota.

Question 9

What are the central issues facing the WTO at the present time?

Accepted Answer

Four issues at the top of the agenda for

Question 10

What is dumping? How do governments respond to charges of dumping?

Accepted Answer

Dumping is defined as selling goods in a

Question 11

During the 1980s and early 1990s, the world trading system erected by the GATT gained momentum as protectionist demands generally decreased across the world.

Accepted Answer

A) True 
 B)False

Question 12

_____ are levied as a proportion of the value of the imported good.

Accepted Answer

A)  Specific tariffs 
B)  Import quotas 
C)  Ad valorem tariffs 
D)  Tariff rate quotas 
A)  Specific tariffs 
B)  Import quotas 
C)  Ad valorem tariffs 
D)  Tariff rate quotas

Question 13

Under a tariff rate quota, a higher tariff rate is applied to imports within the quota than those over the quota.

Accepted Answer

A) True 
 B)False

Question 14

The _____ specifies that government agencies must give preference to American products when putting contracts for equipment out to bid unless the foreign products have a significant price advantage.

Accepted Answer

A)  General Agreement on Tariffs and Trade 
B)  Buy America Act 
C)  American Reinvestment Act 
D)  Smoot-Hawley Act 
A)  General Agreement on Tariffs and Trade 
B)  Buy America Act 
C)  American Reinvestment Act 
D)  Smoot-Hawley Act

Question 15

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Accepted Answer

A) True 
 B)False

Question 16

Tariff rates on agricultural products are generally:

Accepted Answer

A)  much lower than tariff rates on manufactured products or services. 
B)  much lower than import fees on electronics. 
C)  much higher than tariff rates on manufactured products or services. 
D)  much higher than import fees on electronics. 
A)  much lower than tariff rates on manufactured products or services. 
B)  much lower than import fees on electronics. 
C)  much higher than tariff rates on manufactured products or services. 
D)  much higher than import fees on electronics.

Question 17

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

Accepted Answer

A) True 
 B)False

Question 18

Antidumping policies vary drastically from country to country.

Accepted Answer

A) True 
 B)False

Question 19

If a domestic industry lacks the capacity to meet demand, an _____ can raise prices for both the domestically produced and the imported good.

Accepted Answer

A)  import tariff 
B)  import quota 
C)  import subsidy 
D)  ad valorem tariff 
A)  import tariff 
B)  import quota 
C)  import subsidy 
D)  ad valorem tariff

Question 20

GATT has not recognized the infant industry argument as a legitimate reason for protectionism.

Accepted Answer

A) True 
 B)False

A company that sells its product in a foreign market below the cost of production may be accused of _____.

Which of the following is a political reason for governments to intervene in markets?

According to the Buy America Act, if a company wishes to win a contract from a U.S. government agency to provide some equipment, it must ensure that at least 51 percent of the product by value is manufactured in the United States. This is an example of:

The threat of _____ limits the ability of a firm to use aggressive pricing to gain market share in a country.

The WTO's GATS has taken the lead to:

Antidumping duties are often called:

According to the strategic trade policy argument:

What are the central issues facing the WTO at the present time?

What is dumping? How do governments respond to charges of dumping?

During the 1980s and early 1990s, the world trading system erected by the GATT gained momentum as protectionist demands generally decreased across the world.

_____ are levied as a proportion of the value of the imported good.

Under a tariff rate quota, a higher tariff rate is applied to imports within the quota than those over the quota.

The _____ specifies that government agencies must give preference to American products when putting contracts for equipment out to bid unless the foreign products have a significant price advantage.

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Tariff rates on agricultural products are generally:

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

Antidumping policies vary drastically from country to country.

If a domestic industry lacks the capacity to meet demand, an _____ can raise prices for both the domestically produced and the imported good.

GATT has not recognized the infant industry argument as a legitimate reason for protectionism.

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

Foreign Direct Investment

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 7: Government Policy and International Trade

A company that sells its product in a foreign market below the cost of production may be accused of _____.

Which of the following is a political reason for governments to intervene in markets?

According to the Buy America Act, if a company wishes to win a contract from a U.S. government agency to provide some equipment, it must ensure that at least 51 percent of the product by value is manufactured in the United States. This is an example of:

The threat of _____ limits the ability of a firm to use aggressive pricing to gain market share in a country.

The WTO's GATS has taken the lead to:

Antidumping duties are often called:

According to the strategic trade policy argument:

What are the central issues facing the WTO at the present time?

What is dumping? How do governments respond to charges of dumping?

During the 1980s and early 1990s, the world trading system erected by the GATT gained momentum as protectionist demands generally decreased across the world.

_____ are levied as a proportion of the value of the imported good.

Under a tariff rate quota, a higher tariff rate is applied to imports within the quota than those over the quota.

The _____ specifies that government agencies must give preference to American products when putting contracts for equipment out to bid unless the foreign products have a significant price advantage.

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Tariff rates on agricultural products are generally:

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

Antidumping policies vary drastically from country to country.

If a domestic industry lacks the capacity to meet demand, an _____ can raise prices for both the domestically produced and the imported good.

GATT has not recognized the infant industry argument as a legitimate reason for protectionism.

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

Foreign Direct Investment

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