Exam 3: The Political and Legal Environments Facing Business

Logan Electronics has a production facility in Bolivia.Recently,the firm was taxed at a significantly higher rate than a local electronics company.Which type of political risk is Logan most likely experiencing?

Garnet Footwear suffered significant financial losses and had to close its foreign operations.The dissolution process took six months and cost four percent of the firm's value.Where were Garnet's foreign operations most likely located?

Countries with a theocratic legal system encourage precise,detailed contracts whereas countries with a common legal system encourage shorter and less specific contracts.

The fundamental element of democracy is justice.

The ________ of a country specifies the rules that regulate behavior,the processes by which laws are enforced,and the procedures used to resolve grievances.

Which of the following statements about approaches to political risk management is NOT true?

Barkely Enterprises,a U.S.manufacturer,received assistance from the Overseas Private Investment Corporation when it expanded operations into Saudi Arabia.Which of the following types of support did Barkely most likely receive from OPIC?

All of the following are reasons piracy has occurred EXCEPT ________.

A civil law system anchors itself in the wisdom of daily experience or,more intellectually,great spiritual or philosophical traditions.

Intellectual property refers to the creative ideas,innovative expertise,or intangible insights that give an individual,company,or country a competitive advantage.

In which of the following countries would business activity,given its status as a "not free" marketplace,be under the greatest government control?

The rule of man,a practice that has been in play for millennia,presumes that the law is the will of the ruler,whether the king,czar,raj,or emperor.

The Washington Consensus promotes democracy,freedom,the rule of man,and human rights.

International companies often must customize products to comply with local standards if they are to do business in a particular country.

________ is the chance that political forces may change a country's business environment in ways that lead investors to lose some or all of the value of their investment or be forced to accept a lower-than-projected rate of return.

Under the ________ form of totalitarianism,the regime confines itself to political control of the state.It does not regulate the economic and social structure of society.

Elite Manufacturing seeks a foreign location with a highly favorable business environment and a comprehensive legal code.Which of the following countries would be most suitable for Elite?

Which of the following would most likely be used in a totalitarian system to promote unconditional support for the official ideology?

________ political risks arise from political actions,such as public corruption or a partisan judicial system,that interfere with transactions between sellers and buyers and that can significantly raise the costs of getting things done.

A common law system is based on tradition,judge-made precedent,and usage in which the courts assign a preeminent position to existing case law to guide dispute resolution.