International Trade Practice Questions
Course Introduction
International Trade explores the theories, policies, and practical aspects of exchanging goods and services across national borders. The course examines fundamental models explaining why countries trade, the effects of trade policies such as tariffs and quotas, and the impact of international trade on economic growth, income distribution, and developing economies. Topics include comparative advantage, trade agreements, the role of international organizations like the World Trade Organization, and contemporary issues such as globalization, trade disputes, and the balance of payments. Through case studies and real-world applications, students gain a comprehensive understanding of how international trade shapes economies and global relations.
Recommended Textbook
Global Business 3rd Edition by Mike Peng
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17 Chapters
1326 Verified Questions
1326 Flashcards
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Page 2
Chapter 1: Globalizing Business
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78 Verified Questions
78 Flashcards
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Sample Questions
Q1) The term "base of the pyramid" represents economies where individuals make less than $2,000 a year.
A)True
B)False
Answer: True
Q2) A dragon multinational is a name given to MNEs from emerging markets.
A)True
B)False
Answer: True
Q3) The _____ of globalization suggests that globalization is neither recent nor one-directional.
A) new-force view
B) long-run historical view
C) pendulum view
D) colonial view
Answer: C
Q4) The Group of 20 includes the European Union (EU)-a regional bloc.
A)True
B)False
Answer: True
Page 3
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Chapter 2: Understanding Formal Institutions: Politics, Laws, and Economics
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Sample Questions
Q1) Economic systems are examples of formal institutions.
A)True
B)False
Answer: True
Q2) _____ are exclusive legal rights of firms to use specific names,brands,and designs to differentiate their products from others.
A) Patents
B) Trademarks
C) Copyrights
D) Trade secrets
Answer: B
Q3) Civil law uses comprehensive statutes and codes as a primary means to form legal judgments.
A)True
B)False
Answer: True
Q4) Cognitive pillar is the coercive power of governments.
A)True
B)False
Answer: False
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Chapter 3: Emphasizing Informal Institutions: Cultures, Ethics, and Norms
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78 Verified Questions
78 Flashcards
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Sample Questions
Q1) The average length of contracts is longer in low-context countries than in high-context countries.
A)True
B)False
Answer: True
Q2) Power distance is the extent to which less powerful members within a country expect and accept that power is distributed unequally.
A)True
B)False
Answer: True
Q3) Individualists differ from collectivists in that individualists are _____.
A) less collaborative with in-group members
B) more collaborative with out-group members
C) more opportunistic when dealing with in-group members
D) less opportunistic with out-group members
Answer: C
Q4) Ethical imperialism suggests that all ethical standards are relative.
A)True
B)False
Answer: False
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Chapter 4: Leveraging Resources and Capabilities
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Sample Questions
Q1) Which of the following firms is most likely to have a sustained competitive advantage based on the VRIO framework?
A) A firm with valuable but common resources and capabilities
B) A firm with valuable and rare but imitable resources and capabilities
C) A firm with valuable, rare, inimitable resources, and organizationally capabilities
D) A firm with non-value-adding resources and capabilities
Q2) According to the VRIO framework,only valuable and rare resources and capabilities have the potential to provide temporary competitive advantage for a firm.
A)True
B)False
Q3) An ODM is similar to an OBM in that both _____.
A) execute design blueprints provided by other firms
B) include product marketing in their organizational boundary
C) exclude manufacturing in their organizational boundary
D) design and manufacture their own products
Q4) Captive sourcing is also known as foreign direct investment (FDI).
A)True
B)False
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Chapter 5: Trading Internationally
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Sample Questions
Q1) Economist Adam Smith proposed the theory of comparative advantage.
A)True
B)False
Q2) The basic concept of protectionism and mercantilism is the same.
A)True
B)False
Q3) The theory of national competitive advantage of industries assumes that comparative advantage always resides in the lead innovation nation.
A)True
B)False
Q4) Discuss the political arguments against free trade.
Q5) _____ are the most direct denial of absolute or comparative advantage.
A) Quotas
B) Tariffs
C) Local content requirements
D) Subsidies
Q6) Briefly explain the classical theory of mercantilism.
Q7) Briefly elaborate on any three nontariff barriers (NTBs).
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Q8) What are the few factors that determine the success and failure of firms' exports around the globe?
Chapter 6: Investing Abroad Directly
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Sample Questions
Q1) Compared to licensing,FDI increases dissemination risks.
A)True
B)False
Q2) Government's confiscation of foreign assets is known as _____.
A) obsolescing bargains
B) sunk costs
C) expropriation
D) conflicting interests
Q3) Why do firms prefer FDI to licensing?
Q4) A type of FDI in which the firm moves upstream or downstream in different value chain stages in a host country is called horizontal FDI.
A)True
B)False
Q5) _____ knowledge is noncodifiable and its acquisition and transfer requires hands-on practice.
A) Explicit
B) Tacit
C) Lucid
D) A priori
Q6) Describe the process of obsolescing bargain between MNEs and governments.
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Chapter 7: Dealing with Foreign Exchange
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Sample Questions
Q1) Governments adopting the floating exchange rate policy tend to set the exchange rate of a currency relative to other currencies.
A)True
B)False
Q2) The weight a member country carries within the IMF,which determines the amount of its financial contribution,its capacity to borrow from the IMF,and its voting power is referred to as a(n)_____.
A) grant
B) accommodation
C) quota
D) balance of payment
Q3) A currency board is a monetary authority that issues notes and coins convertible into a key foreign currency at a _____ exchange rate.
A) clean floating
B) dirty floating
C) fixed
D) target
Q4) What determines the success and failure of currency management around the globe?
Q5) Briefly explain the cause for the fall of the Bretton Woods System.
Page 9
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Chapter 8: Capitalizing on Global and Regional Integration
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Sample Questions
Q1) NAFTA is a free trade agreement between Latin American countries.
A)True
B)False
Q2) The European Union (EU)was established when the ____ went into effect in 1993.
A) Treaty of Rome
B) Maastricht Treaty
C) Lisbon Treaty
D) ECSC Treaty
Q3) Explain possible benefits of global economic integration.
Q4) _____ refers to the official title for regional economic integration involving 21 member economies around the Pacific.
A) UNASUR
B) APEC
C) NAFTA
D) CAFTA
Q5) The Andean Community's largest trading partner is the United States.
A)True
B)False
Q6) Discuss the benefits and challenges faced by the EU member countries sharing a common currency,the euro.
Page 10
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Chapter 9: Growing and Internationalizing the Entrepreneurial Firm
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Sample Questions
Q1) Individuals who discover,evaluate,and exploit previously unexplored opportunities are referred to as entrepreneurs.
A)True
B)False
Q2) ____ is a way to reach overseas customers by exporting through domestic-based export intermediaries.
A) Direct exports
B) Licensing
C) Indirect exports
D) Letters of credit
Q3) ____ perform an important "middleman" function by linking sellers and buyers overseas.
A) Export intermediaries
B) Indirect exporters
C) Sporadic exporters
D) Alliance partners
Q4) Entrepreneurs need to cultivate strong informal norms granting legitimacy to entrepreneurs.
A)True
B)False
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Chapter 10: Entering Foreign Markets
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Sample Questions
Q1) An advantage of joint ventures is _____.
A) the protection of know-how
B) the access to partners' assets
C) the ease of global coordination
D) the complete equity and operational control
Q2) Indirect exports are the most basic mode of entry,capitalizing on economies of scale in production concentrated in the home country.
A)True
B)False
Q3) Cultural distance is the difference between two cultures along some identifiable dimensions.
A)True
B)False
Q4) Which of the following is an advantage shared by both greenfield operations and acquisitions?
A) Protection of know-how
B) Fast entry speed
C) Add new capacity to industry
D) Low development costs
Q5) Compare and contrast between the strategies of direct and indirect exports.
Page 12
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Chapter 11: Managing Global Competitive Dynamics
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Sample Questions
Q1) The lowest intensity of rivalry between competitors is the result of high resource similarity and low market commonality.
A)True
B)False
Q2) The price leader's _____ is defined as sufficient resources possessed to deter and combat defection.
A) capacity to collude
B) capacity to imitate
C) capacity to punish
D) capacity to compete
Q3) Identify and describe two of the arguments that exist against the practice of imposing antidumping restrictions on foreign firms.
Q4) If globalization pressures for a firm are relatively low,and if the firm has skills and assets that are transferable overseas,which of the following is the best strategy for the firm to use?
A) Defender strategy
B) Extender strategy
C) Dodger strategy
D) Contender strategy
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Chapter 12: Making Alliances and Acquisitions Work
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Sample Questions
Q1) Describe the stages in the formations of alliances.
Q2) One of the disadvantages of having strategic alliances is potential partner opportunism.
A)True
B)False
Q3) In the context of equity-based alliances,_____ involves both firms investing in each other.
A) strategic fit
B) acquisition premium
C) strategic investment
D) cross-shareholding
Q4) Equity alliance relationships tend to have less direct control over joint activities on a continual basis than contractual relationships.
A)True
B)False
Q5) The ability to successfully manage interfirm relationships is called _____.
A) hubristic capability
B) synergistic capability
C) contractual capability
D) relational capability
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Chapter 13: Strategizing,Structuring,and Learning around the World
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Sample Questions
Q1) Social capital is the ability to recognize the value of new information,assimilate it,and apply it.
A)True
B)False
Q2) Informal social capital hinders knowledge management.
A)True
B)False
Q3) What are centers of excellence?
Q4) Absorptive capacity refers to the informal benefits that individuals and organizations derive from their social structures and networks.
A)True
B)False
Q5) Cost pressures often push MNEs to adapt locally.
A)True
B)False
Q6) The transnational strategy is usually the easiest strategy for an MNE to implement and the first one adopted when the firm ventures abroad.
A)True
B)False
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Chapter 14: Competing on Marketing and Supply Chain Management
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Sample Questions
Q1) In international marketing,the country-of-origin effect refers to the positive or negative perception of firms and products from a certain country.
A)True
B)False
Q2) Which of the following is one of the triple As in supply chain management?
A) Accountability
B) Accessibility
C) Applicability
D) Alignment
Q3) Which of the following four Ps of marketing includes TV,radio,print,and online advertising,as well as coupons,direct mail,billboards,direct marketing,and public relations?
A) Prospecting
B) Promotion
C) Pointcasting
D) Positioning
Q4) List a few do's and don'ts to avoid blunders in international marketing.
Q5) Price elasticity refers to the changes in demand when price changes.
A)True
B)False
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Chapter 15: Managing Human Resources Globally
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78 Verified Questions
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Sample Questions
Q1) MNEs only hire host-country nationals to work at a local subsidiary.
A)True
B)False
Q2) In countries with a high context culture,younger expatriates may be ineffective.
A)True
B)False
Q3) A(n)_____ emphasizes the norms and practices of the parent company relying on parent-country nationals.
A) polycentric approach
B) geocentric approach
C) regiocentric approach
D) ethnocentric approach
Q4) Most inpatriates are expected to eventually return to their home country to replace expatriates.
A)True
B)False
Q5) The best way to reduce expatriate turnover is a career development plan.
A)True
B)False
Q6) What are the problems related with inpatriation?
Page 17
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Chapter 16: Financing and Governing the Corporation
Globally
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78 Verified Questions
78 Flashcards
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Sample Questions
Q1) A form of corporate theft that diverts resources from the firm for personal or family use is called _____.
A) tunneling
B) swapping
C) flipping
D) paging
Q2) The costs associated with principal-agent relationships are called _____.
A) principal costs
B) opportunity costs
C) agency costs
D) actual costs
Q3) Companies with diffused ownership have a separation of ownership and control.
A)True
B)False
Q4) Corporations in the United States and the United Kingdom rely mostly on _____.
A) voice-based, internal mechanism
B) bank-oriented, network-based systems
C) bank-oriented, high-tension systems
D) exit-based, external mechanism
Q5) Explain the role of the Board of Directors.
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Chapter 17: Managing Corporate Social Responsibility
Globally
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Sample Questions
Q1) Adopting a code of conduct is a tangible indication of a firm's willingness to accept CSR.
A)True
B)False
Q2) Top management at a reactive firm not only supports and champions CSR activities,but also views CSR as a source of differentiation that permeates throughout the corporate DNA.
A)True
B)False
Q3) A key insight of the institution-based view of CSR is that individuals and organizations make rational choices given the right kind of incentives.
A)True
B)False
Q4) A reactive strategy is indicated by relatively little or no support by top management of CSR causes.
A)True
B)False
Q5) Elaborate on the environmental standards debate concerning CSR.
Q6) Elaborate on the resource-based view to CSR.
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