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Exam 3: Doing Business in Global Markets

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Question 141

True/False

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The Foreign Corrupt Practices Act of 1978 created an advantage for American businesspeople to compete in global markets.

A) True
B) False

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Question 142

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is lowering the value of a nation's currency relative to other currencies.

A) Revaluation
B) Deflatation
C) Devaluation
D) Negative valuation

E) C) and D)
F) B) and D)

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Question 143

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The theory of comparative advantage exists because:

is the selling of products to another country.

The complete ban on the sale of Cuban cigars in the United States is an example of an import quota.

While Asia represents an important source of U.S. imports, few export opportunities exist for U.S. firms to sell goods and services to Asian consumers.

One advantage of franchising is that the parent corporation does not need to concern itself with adapting to the culture of another country.

A complete ban on the import or export of a specific good is called an embargo.

The three countries participating in NAFTA are:

The common market arrangement that groups Brazil, Argentina, Paraguay, Uruguay, Chile, and Bolivia is called the:

Telewhiz, Inc. just contracted with a firm in the Philippines to provide customer service for its cell phone customers. Although there were cheaper labor markets that Telewhiz could have tapped, customers have reported that they understand English speaking Filipino people better than English speaking people in other countries. As an outsourcing option, it is a good compromise.

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

Expropriation occurs when a host government takes over the assets of a foreign company.

A trade deficit is the same as a favorable balance of trade.

Foreign direct investment refers to the buying of goods produced in another country.

Global trade includes the exchange of art, sports, and cultural events.

occurs when a country has a monopoly on producing a product or is able to produce it at a cost well below that of all other countries.

A is a partnership in which two or more companies (often from different countries) join together and share the risk and costs in order to undertake a major project.

Which of the following is an advantage of offshore outsourcing?

In the Spotlight on Small Business topic, "Finding Cracks in the Great Wall," Mitch Free of MFG.com learned that lessons in doing business with other cultures are probably an unnecessary expense.