Course Introduction
International Business Exam Practice Tests
International Business explores the complexities of conducting commerce across national borders, examining topics such as global trade theories, international market entry strategies, cultural differences, global supply chains, and the impact of political and legal environments on business operations. The course provides students with a comprehensive understanding of how businesses adapt to diverse economic, legal, and cultural contexts, and develop strategies for competitive advantage in the global marketplace. Through case studies and real-world examples, students learn to analyze international business opportunities and challenges, as well as the ethical considerations involved in cross-border transactions.
Recommended Textbook
International Economics 15th Edition by Robert Carbaugh
Available Study Resources on Quizplus
17 Chapters
1863 Verified Questions
1863 Flashcards
Source URL: https://quizplus.com/study-set/3500
Page 2
Chapter 1: The International Economy and Globalization
Available Study Resources on Quizplus for this Chatper
48 Verified Questions
48 Flashcards
Source URL: https://quizplus.com/quiz/69522
Sample Questions
Q1) A main advantage of specialization results from:
A) Economies of large-scale production
B) The specializing country behaving as a monopoly
C) Smaller production runs resulting in lower unit costs
D) High wages paid to foreign workers
Answer: A
Q2) International trade in goods and services is sometimes used as a substitute for all of the following except:
A) International movements of capital
B) International movements of labor
C) Domestic production of the same goods and services
D) Domestic production of different goods and services
Answer: D
Q3) The United States was less open to international trade between:
A) 1890 and 1910
B) 1930 and 1950
C) 1890 and 1950
D) 1950 and 2013
Answer: C
To view all questions and flashcards with answers, click on the resource link above.
Page 3
Chapter 2: Foundations of Modern Trade Theory:
Comparative Advantage
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/69523
Sample Questions
Q1) Refer to Figure 2.1.If the relative cost of aluminum were to rise,then the production possibilities schedule would:
A) Become steeper
B) Become flatter
C) Shift inward in a parallel manner
D) Shift outward in a parallel manner
Answer: B
Q2) The theory of reciprocal demand does not well apply when one country:
A) Produces under constant cost conditions
B) Produces along its production possibilities curve
C) Is of minor economic importance in the world marketplace
D) Partially specializes the production of its export good
Answer: C
Q3) Refer to Figure 2.1.If the relative cost of steel were to rise,then the production possibilities schedule would:
A) Become steeper
B) Become flatter
C) Shift inward in a parallel manner
D) Shift outward in a parallel manner
Answer: A
4
To view all questions and flashcards with answers, click on the resource link above.
Chapter 3: Sources of Comparative Advantage
Available Study Resources on Quizplus for this Chatper
108 Verified Questions
108 Flashcards
Source URL: https://quizplus.com/quiz/69524
Sample Questions
Q1) With economies of scale,specialization in a few products allows a manufacturer to benefit from longer production runs which lead to decreasing average cost.
A)True
B)False
Answer: True
Q2) Because seasons in the Southern Hemisphere are opposite those in the Northern Hemisphere,one would expect intra-industry trade to occur in agricultural products.
A)True
B)False
Answer: True
Q3) The Leontief paradox provided:
A) Support for the principle of absolute advantage
B) Support for the factor endowment model
C) Evidence against the factor endowment model
D) Evidence against the principle of absolute advantage
Answer: C
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Tariffs
Available Study Resources on Quizplus for this Chatper
124 Verified Questions
124 Flashcards
Source URL: https://quizplus.com/quiz/69525
Sample
Questions
Q1) With a compound duty,its "specific" portion neutralizes the cost disadvantage of domestic manufacturers that results from tariff protection granted to domestic suppliers of raw materials,and the "ad valorem" portion of the duty grants protection to the finished-goods industry.
A)True
B)False
Q2) Bonded warehouses and foreign trade zones have the effect of allowing domestic importers to postpone and prorate over time their import duty obligations.
A)True
B)False
Q3) Although tariffs on imported steel may lead to job gains for domestic steel workers,they can lead to job losses for domestic auto workers.
A)True
B)False
Q4) A tariff on steel imports tends to improve the competitiveness of domestic automobile companies.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Nontariff Trade Barriers
Available Study Resources on Quizplus for this Chatper
134 Verified Questions
134 Flashcards
Source URL: https://quizplus.com/quiz/69526
Sample Questions
Q1) Voluntary export restraint agreements typically apply to all of the world's exporting nations rather than only the most important exporting nations.
A)True
B)False
Q2) Describe some of the differences between tariffs and quotas?
Q3) According to the U.S.Buy American Act,federal government agencies cannot purchase materials and products from U.S.suppliers if their prices are higher than those of foreign competitors.
A)True
B)False
Q4) If the Australian government imposes a domestic content requirement of 75 percent on autos,at least 25 percent of an auto's value must be produced in a foreign country if that auto is to be sold in Australia.
A)True
B)False
Q5) What is the price-based definition of dumping?
Q6) What are the intent and impact of domestic content requirements?
Q7) Is a tariff-rate quota a two-tier tariff? Why?
Page 7
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Trade Regulations and Industrial Policies
Available Study Resources on Quizplus for this Chatper
129 Verified Questions
129 Flashcards
Source URL: https://quizplus.com/quiz/69527
Sample Questions
Q1) The only members of the General Agreement on Tariffs and Trade and its successor,the World Trade Organization,are developing countries rather than developed countries.
A)True
B)False
Q2) Industrial policies of the U.S.government have included subsidizing particular firms to promote national champions,nationalizing basic industries,and encouraging cartelization of industries.
A)True
B)False
Q3) A trade policy designed to alleviate some domestic economic problem by exporting it to foreign countries is known as a (an):
A) International dumping policy
B) Trade adjustment assistance policy
C) Most-favored-nation policy
D) Beggar-thy-neighbor policy
Q4) Explain how advocates of strategic trade policy differ from the classical free traders in their treatment of externalities?
Q5) What is the basis for trade adjustment assistance?
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Trade Policies for the Developing Nations
Available Study Resources on Quizplus for this Chatper
100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/69528
Sample Questions
Q1) Consider Figure 7.3.Under competitive conditions,producer profits total:
A) $0
B) $140
C) $200
D) $280
Q2) To be considered a good candidate for an export cartel,a commodity should:
A) Be a manufactured good
B) Be a primary product
C) Have a high price elasticity of supply
D) Have a low price elasticity of demand
Q3) The "newly industrializing countries" of East Asia have emphasized the implementation of import-substitution policies to insulate their industries from international competition.
A)True
B)False
Q4) To prevent the market price of tin from falling below the target price,the manager of a buffer stock would purchase any excess supply of tin that exists at the target price.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Regional Trading Arrangements
Available Study Resources on Quizplus for this Chatper
130 Verified Questions
130 Flashcards
Source URL: https://quizplus.com/quiz/69529
Sample Questions
Q1) Suppose that government procurement liberalization results in the U.K.government importing automobiles from Germany,the low-cost EU manufacturer.Cost savings could result from all of the following except:
A) Competition effect
B) Scale-economy effect
C) Protective effect
D) Trade effect
Q2) In 1989 Canada and the United States agreed to implement a (an)____ over a ten year period.
A) Customs union
B) Common market
C) Free trade area
D) Economic union
Q3) The common agricultural policy of the European Union has:
A) Increased American farm exports to the EU
B) Decreased American farm exports to the EU
C) Lowered the price of American farm exports to the EU
D) Not affected the price of American farm exports to the EU
Q4) What factors influence the extent of trade creation and trade diversion?
Q5) What is meant by economic integration?
Page 10
To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: International Factor Movements and Multinational
Enterprises
Available Study Resources on Quizplus for this Chatper
96 Verified Questions
96 Flashcards
Source URL: https://quizplus.com/quiz/69530
Sample Questions
Q1) The effect of workers migrating from low-wage Mexico to high-wage United States is to redistribute income from capital to labor in the United States and from labor to capital in Mexico.
A)True
B)False
Q2) The United States has discouraged the "brain drain" problem by permitting the immigration of unskilled workers while restricting the immigration of skilled persons.
A)True
B)False
Q3) Multinational corporations sometimes locate manufacturing subsidiaries abroad to avoid tariff barriers which would place their products at a competitive disadvantage in a foreign country.
A)True
B)False
Q4) Joint ventures may lead to
A) Welfare increases
B) Welfare decreases
C) No changes in welfare
D) All of the above
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: The Balance of Payments
Available Study Resources on Quizplus for this Chatper
92 Verified Questions
92 Flashcards
Source URL: https://quizplus.com/quiz/69531
Sample Questions
Q1) Concerning the U.S.balance of payments,which account is defined in essentially the same way as the net export of goods and services,which comprises part of the country's gross domestic product?
A) Merchandise trade account
B) Goods and services account
C) Current account
D) Capital account
Q2) That U.S.importers purchase bananas from Brazil constitutes a debit transaction on the U.S.balance of payments.
A)True
B)False
Q3) If Bank of America receives repayment for a loan it made to a Mexican firm,the U.S.capital account would register an inflow.
A)True
B)False
Q4) Concerning the balance of international indebtedness,when is a country a net creditor or a net debtor?
Q5) What are the components of the current account of the balance of payments?
Q6) What does a current account deficit mean?
Page 12
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Foreign Exchange
Available Study Resources on Quizplus for this Chatper
121 Verified Questions
121 Flashcards
Source URL: https://quizplus.com/quiz/69532
Sample Questions
Q1) Refer to Figure 11.3.If the supply curve is represented by S<sub>0</sub>,the equilibrium exchange rate is
A) $1.20
B) $1.00
C) $0.80
D) $0.60
Q2) Referring to Table 11.3,the yen cost of purchasing 100 British pounds is roughly:
A) 18,000 yen
B) 19,000 yen
C) 20,000 yen
D) 21,000 yen
Q3) Grain shortages in countries that buy large amounts of grain from the United States would increase the demand for American grain and:
A) Reduce the demand for dollars
B) Increase the demand for dollars
C) Reduce the supply of dollars
D) Increase the supply of dollars
Q4) Where are foreign currency options traded?
Q5) What foreign exchange transactions do banks typically engage in?
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Exchange-Rate Determination
Available Study Resources on Quizplus for this Chatper
133 Verified Questions
133 Flashcards
Source URL: https://quizplus.com/quiz/69533
Sample Questions
Q1) What is the purchasing power parity approach to exchange rate determination?
Q2) Refer to Figure 12.2.If the United States decreases tariffs on imports from Switzerland,there would occur a decrease in the demand for francs and a decrease in the dollar price of the franc.
A)True
B)False
Q3) Given a system of floating exchange rates,stronger U.S.preferences for imports would trigger:
A) An increase in the demand for imports and an increase in the demand for foreign currency
B) An increase in the demand for imports and a decrease in the demand for foreign currency
C) A decrease in the demand for imports and an increase in the demand for foreign currency
D) A decrease in the demand for imports and a decrease in the demand for foreign currency
Q4) In a free market,what determines exchange rates in the long run and the short run?
Q5) What is exchange rate overshooting?
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Mechanisms of International Adjustment
Available Study Resources on Quizplus for this Chatper
107 Verified Questions
107 Flashcards
Source URL: https://quizplus.com/quiz/69534
Sample Questions
Q1) Refer to Exhibit 13.1.The change in the level of U.S.imports resulting from the rise in U.S.income equals:
A) $5 billion
B) $10 billion
C) $15 billion
D) $20 billion
Q2) Refer to Figure 13.3.If the political and economic stability of foreign countries worsens relative to that of the United States,the U.S.capital and financial account schedule would shift downward from CA<sub>0</sub> to CA<sub>1</sub>,resulting in net financial outflows from the United States.
A)True
B)False
Q3) Under the gold standard,a surplus nation facing a gold inflow and an increase in its money supply would also experience a:
A) Rise in its interest rate and a short-term financial inflow
B) Rise in its interest rate and a short-term financial outflow
C) Fall in its interest rate and a short-term financial inflow
D) Fall in its interest rate and a short-term financial outflow
Q4) What is the foreign repercussion effect?
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Exchange-Rate Adjustments and the Balance of Payments
Available Study Resources on Quizplus for this Chatper
100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/69535
Sample Questions
Q1) According to the J-curve effect,currency depreciation:
A) Decreases a trade deficit
B) Increases a trade deficit
C) Decreases a trade deficit before increasing a trade deficit
D) Increases a trade deficit before decreasing a trade deficit
Q2) According to the absorption approach,currency devaluation best improves a country's trade balance when its economy is at maximum capacity.
A)True
B)False
Q3) As yen-denominated costs become a larger portion of Ford's total costs,a dollar appreciation results in a smaller increase in the yen-denominated cost of a Ford auto than occurs when all input costs are dollar denominated.
A)True
B)False
Q4) The extent to which changing currency values result in changing prices of imports and exports is known as the J-curve effect.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Exchange-Rate Systems and Currency Crises
Available Study Resources on Quizplus for this Chatper
107 Verified Questions
107 Flashcards
Source URL: https://quizplus.com/quiz/69536
Sample Questions
Q1) Under managed floating exchange rates,if the rate of inflation in the United States is less than the rate of inflation of its trading partners,the dollar will likely:
A) Appreciate against foreign currencies
B) Depreciate against foreign currencies
C) Be officially revalued by the government
D) Be officially devalued by the government
Q2) Given a two-country world,assume Canada and Sweden devalue their currencies by 20 percent.This would result in:
A) An appreciation in the Canadian currency
B) An appreciation in the Swedish currency
C) An appreciation in both currencies
D) An appreciation in neither currency
Q3) A surplus nation can reduce its payments imbalance by:
A) Applying tariffs and trade restrictions on imports
B) Revaluing its national currency
C) Increasing its labor productivity
D) Setting higher interest rates than its trading partners
Q4) How can currency boards and dollarization prevent currency crises?
Q5) What is an SDR?
To view all questions and flashcards with answers, click on the resource link above. Page 17
Chapter 16: Macroeconomic Policy in an Open Economy
Available Study Resources on Quizplus for this Chatper
72 Verified Questions
72 Flashcards
Source URL: https://quizplus.com/quiz/69537
Sample Questions
Q1) Economic policymakers have typically adopted expenditure-increasing policies to combat inflation and expenditure-reducing policies to combat recession.
A)True
B)False
Q2) When a nation realizes external balance
A) it can have a current account deficit
B) it can have a current account surplus
C) it has neither a current account deficit nor a current account surplus
D) Both a and b
Q3) Which policies are expenditure-changing policies?
A) Currency devaluation and revaluation
B) Import quotas and tariffs
C) Monetary and fiscal policy
D) Wage and price controls
Q4) The goals of the Plaza Agreement of 1985 were to combat protectionism in the U.S.Congress,promote world economic expansion by stimulating demand in Germany and Japan,and to ease the burden of the U.S.debt service.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: International Banking: Reserves, Debt, and Risk
Available Study Resources on Quizplus for this Chatper
96 Verified Questions
96 Flashcards
Source URL: https://quizplus.com/quiz/69538
Sample Questions
Q1) Which indicator of international debt burden schedules interest and principal payments on long-term debt as a percent of export earnings?
A) Debt service ratio
B) Debt-to-export ratio
C) Ratio of external debt to gross domestic product
D) Ratio of external debt to gross national product
Q2) How can a bank reduce its exposure to the debt of developing nations?
Q3) "Borrowed" international reserves consist of:
A) IMF drawings
B) Foreign currencies
C) Gold
D) Special drawing rights
Q4) In the market for British Pounds the demand is represented by D<sub>0</sub> and supply by S<sub>0</sub>.If the exchange rate is allowed to rise as high as $4 and the demand for pounds increases to D1,US monetary authorities will need to
A) supply 8 million pounds to the market
B) supply 4 million pounds to the market
C) supply 2 million pounds to the market
D) do nothing
To view all questions and flashcards with answers, click on the resource link above. Page 19