International Economics
Exam Answer Key
Course Introduction
International Economics explores the economic interactions among countries, focusing on the theories of international trade, trade policy, and the effects of globalization. Topics include comparative advantage, the gains from trade, barriers to trade, international financial markets, exchange rates, and the impacts of government policies on trade flows and capital movements. The course also examines current issues such as trade agreements, economic integration, and the role of international organizations in shaping global economic relations. Through theoretical frameworks and empirical analysis, students gain an understanding of how international economic forces influence national economies and global welfare.
Recommended Textbook
International Business The Challenges of Globalization 9th Edition by John J. Wild
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16 Chapters
1650 Verified Questions
1650 Flashcards
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Page 2
Chapter 1: Globalization
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100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/40400
Sample Questions
Q1) Jeans Unlimited manufactures its clothing at facilities located in two Southeast Asian countries.The dispersal of manufacturing activities by the company indicates
A) customization of products
B) niche marketing
C) globalization of markets
D) globalization of production
Answer: D
Q2) Two major forces that underlie the expansion of globalization are falling barriers to trade and investment,and ________.
A) elevation of nationalism
B) rise of closed economies
C) political stagnation
D) technological innovation
Answer: D
Q3) Critics of globalization argue that it eliminates jobs in developing nations.
A)True
B)False
Answer: False
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Page 3
Chapter 2: Cross-Cultural Business
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) ________ tend to occupy the highest social layer in industrialized countries.
A) Teachers
B) Scientists
C) Medical doctors
D) Business leaders
Answer: D
Q2) Cultures that score high on uncertainty avoidance tend to be less open to change and new ideas.
A)True
B)False
Answer: True
Q3) Ethnocentricity can be defined as the ________.
A) scientific description of individual human societies
B) systematic study of an ethnic group's religious core
C) merging of all ethnic practices into one homogeneous culture
D) belief that one's own ethnic group or culture is superior to that of others
Answer: D
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Page 4
Chapter 3: Political Economy and Ethics
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) ________ is the layer of corporate social responsibility whereby a corporation donates money and,perhaps,employee time toward a specific social cause.
A) Risk management
B) Strategic Corporate Social Responsibility (CSR)
C) Socialist Corporate Social Responsibility (CSR)
D) Traditional philanthropy
Answer: D
Q2) Which of the following statements is true of Paribo,a democratic nation whose legal system is based on civil law?
A) The law is based on religious teachings and is enforced by the country's religious leaders.
B) The law is flexible and its interpretations differ with situations.
C) The law is based on a detailed set of written rules that constitute a legal code.
D) The law is interpreted on the basis of tradition, precedent and usage.
Answer: C
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Chapter 4: Economic Development of Nations
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86 Verified Questions
86 Flashcards
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Sample Questions
Q1) Expropriation is the term used to describe a host-country government seizing the assets of a foreign corporation and providing no compensation in return.
A)True
B)False
Q2) Christopher Electronics plans to expand into foreign markets.Top executives want the firm to focus only on locations where the rule of law prevails.Which of the following should most likely be considered by Christopher?
A) wealthier, westernized countries
B) developing, non-Western countries
C) emerging economies experiencing rapid growth
D) countries inclined toward totalitarian-style government
Q3) Guanxi,in the Chinese business context,means ________.
A) bribing government officials
B) manufacturing inexpensive products
C) personal relationships
D) preference for communism
Q4) Differentiate between GDP and GNP.Briefly discuss the drawbacks of using GDP and GNP as indicators of economic development.
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Chapter 5: International Trade Theory
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) Which of the following refers to the ability of a nation to produce a good more efficiently than any other nation?
A) mercantilism
B) comparative advantage
C) absolute advantage
D) neomercantilism
Q2) Factor proportions theory states that a country will produce and export those goods that require resources abundantly available within the country.
A)True
B)False
Q3) When a country is not able to produce a good more efficiently than other nations,but produces the good more efficiently than it does any other good,it is said to have a(n)________.
A) absolute advantage
B) resource advantage
C) first-mover advantage
D) comparative advantage
Q4) Explain how the theory of absolute advantage conflicts with the theory of mercantilism.
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Chapter 6: Political Economy of Trade
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108 Verified Questions
108 Flashcards
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Sample Questions
Q1) The purpose of ________ is to force companies from other nations to use local resources in their production processes,particularly labor.
A) administrative delays
B) currency controls
C) local content requirements
D) voluntary export restraints
Q2) Which of the following is true regarding the protection of infant industries from international competition?
A) It is difficult for governments to identify the industries worth protecting.
B) Protection of infant industries helps domestic companies become innovative.
C) Protection from competition leads to improved quality and lower prices.
D) Protection leads to more economic good than harm.
Q3) Describe the role of special government agencies in promoting exports and imports.
Q4) Which of the following is a method of restricting trade?
A) export financing
B) local content requirements
C) subsidy
D) foreign trade zones
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Chapter 7: Foreign Direct Investment
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104 Verified Questions
104 Flashcards
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Sample Questions
Q1) Exports and imports of computer software,electronic components,and apparel are included in the ________ account of a country's balance of payments.
A) services
B) capital
C) merchandise
D) savings
Q2) Firms from emerging markets account for a greater share of global mergers and acquisitions than developed markets.
A)True
B)False
Q3) In industries having a limited number of small firms,foreign direct investment decisions frequently resemble a "follow the leader" scenario.
A)True
B)False
Q4) According to the market imperfections theory,competition is a common market imperfection.
A)True
B)False
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Page 9
Chapter 8: Regional Economic Integration
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111 Verified Questions
111 Flashcards
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Sample Questions
Q1) Which of the following would the government of Zucoland most likely experience as a benefit of joining the trading bloc?
A) increased national sovereignty
B) increased military security
C) trade diversion
D) higher-wage employment
Q2) The European Union is an example of ________ integration.
A) regional
B) relative
C) global
D) bilateral
Q3) Briefly describe regional integration efforts in Central America and the Caribbean.
Q4) Discuss free trade areas as a level of regional economic integration.How can regional integration enable employment opportunities?
Q5) The stated aim of Asia Pacific Economic Cooperation (APEC)is to strengthen the multilateral trading system.
A)True
B)False
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Chapter 9: International Financial Markets
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109 Verified Questions
109 Flashcards
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Sample Questions
Q1) A currency used as an intermediary to convert funds between two other currencies in the foreign exchange market is called a ________.
A) local currency
B) vehicle currency
C) community currency
D) private currency
Q2) ________ is the simultaneous purchase and sale of foreign exchange for two different dates.
A) Currency hedging
B) Currency speculation
C) Currency swap
D) Currency arbitrage
Q3) Banks in the interbank market ________.
A) provide long-term loans to small-sized and medium-sized companies
B) provide long-term loans to large companies
C) offer advice on trading strategies
D) exchange currencies exclusively at spot rates
Q4) Describe the purposes of the international capital market.What factors account for its rapid growth?
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Chapter 10: International Monetary System
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107 Verified Questions
107 Flashcards
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Sample Questions
Q1) ________ is an activity under the monetary policy of a nation.
A) Increasing taxes
B) Lowering taxes
C) Increasing government spending
D) Selling government securities
Q2) An exchange-rate system in which the exchange rate for converting one currency into another is set by international governmental agreement is called a ________ system.
A) floating exchange-rate
B) fixed exchange-rate
C) cross rate
D) spot rate
Q3) Devaluation increases the price of a country's exports in the global market and increases the price of its imports.
A)True
B)False
Q4) The gold standard effectively created a floating exchange-rate system.
A)True
B)False
Q5) Briefly describe the gold standard,its advantages,and why it collapsed.
Page 12
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Chapter 11: International Strategy and Organization
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) The main benefit of a multinational strategy is that it allows companies to monitor buyer preferences closely in each local market.
A)True
B)False
Q2) Which of the following statements is true of objectives?
A) Objectives of individual business units in a company tend to be stated in the most general terms.
B) Objectives become more precise at the level of individual departments.
C) Objectives at the highest level in an organization tend to be more specific.
D) Objectives at the highest level in an organization are more concrete as they contain numerical targets.
Q3) ________ decision making disperses decisions to lower organizational levels,such as to international subsidiaries.
A) Decentralized
B) Top-down
C) Authoritative
D) Top management
Q4) Explain the different ways in which products can be differentiated,providing an example of each.
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Chapter 12: Analyzing International Opportunities
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102 Verified Questions
102 Flashcards
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Sample Questions
Q1) Trade missions are advantageous to small businesses as they are the most inexpensive method of getting introduced to important business contacts.
A)True
B)False
Q2) When developing a market-potential indicator for an emerging market,the ________ factor attempts to assess channels of distribution and communication.
A) market size
B) market intensity
C) commercial infrastructure
D) economic freedom
Q3) If Matt wants to estimate an emerging market's spending capacity,he should focus on the ________.
A) population in the middle class
B) need for consumer products
C) demand for consumer and industrial products
D) volume of imports
Q4) Explain why the availability of data is a challenge when conducting international research.How do interviews and focus groups help in the availability of data?
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Chapter 13: Selecting and Managing Entry Modes
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106 Verified Questions
106 Flashcards
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Sample Questions
Q1) A(n)________ exports products on behalf of an indirect exporter.
A) local distributor
B) subsidiary
C) sales representative
D) export management company
Q2) Which of the following allows a country to earn back some of the currency it pays out for imports?
A) switch trading
B) counterpurchase
C) buyback
D) barter
Q3) What are the different financing methods available to exporters and importers?
Q4) Gro-Tru would be engaging in ________,if it decides that in exchange for a hard-currency sale it would make a hard-currency purchase of an unspecified product from the importing nation in the future.
A) barter
B) offset
C) switch trading
D) buyback
Q5) What are the differences between a turnkey project and a strategic alliance?
Page 15
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Chapter 14: Developing and Marketing Products
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103 Verified Questions
103 Flashcards
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Sample Questions
Q1) Which of the following communication strategies adapts both the product and its marketing communication to suit the target market?
A) product/communications extension
B) product extension/communications adaptation
C) product adaptation/communications extension
D) product/communications adaptation
Q2) When a product has a higher selling price in the target market than it does in the home market or the country where production takes place,it is called ________.
A) price skimming
B) price escalation
C) price dispersion
D) price fixing
Q3) Briefly discuss the effects of globalization on international marketing activities and explain how a dual adaption method works as a promotional strategy.
Q4) A brand name can function as a form of intellectual property.
A)True
B)False
Q5) How does the dual extension method work as a promotional strategy?
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Chapter 15: Managing International Operations
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) The make-or-buy decision primarily relates to ________.
A) reducing production
B) acquiring components
C) forming joint ventures
D) obtaining foreign facilities
Q2) A company that sells undifferentiated products in all their markets and do not need to locate near their markets in order to stay on top of changes in buyer preferences use
A) vertical integration
B) centralized production
C) lean production
D) continuous production
Q3) Companies selling undifferentiated products find centralized production most effective.
A)True
B)False
Q4) A back-to-back loan is one in which a subsidiary acquires a loan from the same bank where its parent secured the first loan.
A)True
B)False
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Chapter 16: Hiring and Managing Employees
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102 Verified Questions
102 Flashcards
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Sample Questions
Q1) The process of recruitment involves screening and hiring the best-qualified applicants with the greatest performance potential.
A)True
B)False
Q2) An expatriate manager who returns after a few years from an overseas assignment to find that there is no position for him in his home country office experiences a(n)________.
A) reverse culture shock
B) expatriate failure
C) cognitive dissonance
D) assimilation effect
Q3) The process of screening and hiring the best-qualified applicants with the greatest performance potential is called ________.
A) performance appraisal
B) orientation
C) recruitment
D) selection
Q4) Compare and contrast the methods of cultural training.Is any single method better than all the others?
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