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Exam 3: Doing Business in Global Markets

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Question 51

True/False

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Trade protectionism is the use of government regulations to encourage the import of goods and services.

A) True
B) False

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Question 52

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Another name for a common market is:

A) FTA.
B) Trading bloc.
C) Continental community.
D) Economic cooperative.

E) A) and D)
F) None of the above

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Question 53

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One reason countries trade with other countries is that even technologically advanced nations cannot produce all the products their people want and need.

Under a system of floating exchange rates,the value of a country's currency is determined by government regulation.

The Dabble Corporation wants to begin exporting its products.The company needs advice about how to get started,as well as trade-finance support.The federal government has established _____________ to help companies like Dabble Corporation.

American businesspersons often fail to adapt to foreign markets because they feel that American culture is superior to other cultures in the world.

Any corporation that exports at least 50% of its total output can be classified as a multinational corporation.

An import quota is a complete ban on the import or export of certain products.

Currency fluctuations can be an advantage to firms trading in the global market.

The Ozark Bike Company recently entered into an agreement with a large Japanese retailer to distribute its bicycles in Japan.Ozark Bike Company sees itself in a favorable position because:

A Mexican firm has agreed to trade petroleum to an American importer in return for U.S.made computers.This arrangement is an example of:

A Chinese steel manufacturer is selling certain types of steel in the United States at a price significantly lower than it sells the same steel in its home market.This practice may be a violation of U.S.law.

The nation of Redland reported that its imports for the previous year were $4 billion greater than its exports.During the same period,Redland reported a favorable balance of payments.This information suggests:

Recently a news article described the pirating of music originally recorded by popular celebrities in the U.S.It seems that a recording made in the U.S.can be copied within a couple of hours and sold abroad.The U.S.government is able to readily prosecute foreign companies involved in these illegal actions.

Successful multinational corporations disregard cultural differences between countries where they own property and perform business transactions.

Boasting a $1.6 billion Ketchup brand,the H.J.Heinz Company is flying high with a 44% increase in its sales of Indonesian based ABC,a soy sauce company that it owns.ABC is a _____________ of Heinz.

While franchising is popular in the United States,it is not an accepted strategy for firms in the global market.

The theory of _______________ states that a nation should produce and sell goods to other countries that it produces most efficiently,and buy goods from other nations that they produce more efficiently.

A firm desiring to enter a foreign market with a limited investment should consider licensing.

A major advantage of licensing is: