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Exam 3: Doing Business in Global Markets

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Question 91

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In order to prevent dumping,U.S.law stipulates that foreign firms selling similar products as domestic firms to U.S.customers must charge at least 10% more than what U.S.firms charge.

A) True
B) False

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Question 92

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Since the approval of the North American Free Trade Agreement NAFTA),the value of U.S.exports to Mexico and Canada has increased.

A) True
B) False

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Question 93

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According to the theory of mercantilism,a country should develop policies that encourage a favorable balance of trade.

Some governments initiate restrictive standards that detail exactly how a product must be sold in a country.Trade experts call these restrictions ________________.

Technological differences can prevent some companies from doing business abroad.

Contract manufacturing is when a firm pays foreign manufacturers to produce its product.The Foreign manufacturer places the domestic company's label on the products.

The All-Sports Gaming Company has avoided contract manufacturing abroad due to the significant start-up costs in buying land and setting up its own manufacturing plants.

The United States enjoys a trade surplus in the global market.

A major concern voiced by U.S.critics of the North American Free Trade Agreement NAFTA) is that it would result in:

Workers in the nation of Argenia prefer managers that forcefully tell employees what to do and how to do it.Conversely,employees in the U.S.prefer to participate in decision making in the workplace.This __________ difference between Argenian workers and U.S.workers represents a management challenge for firms trading in the global market.

A devaluation of the U.S.dollar would make American goods cheaper to foreign buyers.

Denmark requires foreign companies that sell butter in Denmark to sell it in cubes,not tubs.This type of requirement is known as a:

Many of the toy products sold in the United States are imported from Taiwan because the Taiwanese can produce these products more efficiently than U.S.companies.This is an example of:

Although he is confident of success,Rhett is concerned that social,cultural and economic differences in other nations may create some problems.He believes he should adapt his approach to these differences rather than trying to force the "American way" on foreign consumers.Rhett's attitude suggests that he wants to avoid an) ___________ approach to business.

Explain and provide at least one example of how socio-cultural differences can create trade difficulties in world markets.

As a business strategy,the strategy behind "dumping" is to ____________.

If you travel to Mexico and the exchange rate is 12 pesos for one U.S.dollar,the peso is said to have strength against the dollar because you can get so many more pesos that you can dollars.

ExxonMobil Corporation refines and markets its petroleum products in many different nations.In addition,Exxon's stockholders and managers come from many different nations.If some of the nations where it operates decided to take over the assets of the company,this act would constitute:

With the achievements of the General Agreement on Tariffs and Trade GATT)and the World Trade Organization WTO),nearly all barriers to trade expansion are finally removed.

The U.S.government continues to be committed to free-trade agreements,as evidenced by the more recent passage of CAFT A.The future goal of U.S.free trade advocates is: