TEST BANK For Global Business Today 7th Canadian Edition By Charles W. L. Hill, Thomas McKaig, Frank Cotae, Jacqueline Musabende Student name:__________ 1)
According to the opening case, Bombardier is a good example of:
A) domestic markets B) foreign exchange C) globalization of production D) outsourcing E) deregulation
2) The trend toward a more integrated and interdependent global economic system that has been in place for many years is commonly referred to as:
A) market standardization B) cross-border integration C) globalization D) consumerism E) nationalization
3)
Sourcing goods and services from locations around the globe is known as __________.
A) melding of markets B) integration of markets C) deregulation D) globalization of production E) globalization of markets
4)
Currently, most global markets are markets for what type of product?
Version 1
1
A) Consumer goods B) Industrial goods C) National products D) Deregulated products E) Local goods
5) The globalization of __________ refers to the sourcing of goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production (such as labour, energy, land, and capital).
A) information technology B) process design C) markets D) production E) R&D
6)
The factors of production include:
A) information technology B) process design C) markets D) labour E) research and development
7) The _______ was created in 1944 by 44 nations that met in Bretton Woods, New Hampshire.
Version 1
2
A) International bank B) World Monetary Fund C) World Trade Organization D) International Monetary Fund E) United Nations
8) The _______ is seen as the lender of last resort to nation-states whose economies are in turmoil and currencies are losing value against those of other nations.
A) International Monetary Fund B) International bank C) United Nations D) Canada's Export Development Corporation E) Bank of Canada
9)
Who is responsible for policing the world trading system?
A) International Monetary Fund B) The World Bank C) The World Trade Organization D) Canada's Export Development Corporation E) Bank of Canada
10)
What was created at the same time as the International Monetary Fund?
Version 1
3
A) World Bank B) GATT C) United Nations D) Canada's Export Development Corporation E) Bank of Canada
11) Although this organization is perhaps best known for its peacekeeping role, one of its central mandates is the promotion of higher standards of living, full employment, and conditions of economic and social progress and development. What is it called?
A) World Bank B) GATT C) United Nations D) Canada's Export Development Corporation E) Bank of Canada
12) _______ are the two macro factors that seem to underlie the trend toward greater globalization.
A) The increase in global economic stability, and the slowdown in technological change B) The increase in barriers to the free flow of goods, services, and capital that has occurred since the end of World War II, and global economic stability C) The decline in barriers to the free flow of goods, services, and capital that has occurred in the past 10 years, and the slowdown in technological change D) The decline in barriers to the free flow of goods, services, and capital that has occurred since the end of World War II, and technological change E) Technological change and the convergence of global product preferences
Version 1
4
13) A firm exports a number of products to users in other countries. This practice is referred to as __________.
A) world exchange B) international trade C) cross-national barter D) situational commerce E) multinational diversification
14) XYZ, Inc. is an auto parts distributing warehouse that exports many of its products to consumers in other countries. XYZ Inc. can be described as engaging in:
A) international trade. B) cross-border investments. C) product development. D) trading barriers. E) international procurement.
15) Which of the following refers to the exporting of goods or services to consumers in another country?
A) situational commerce B) world exchange C) international trade D) cross-national barter E) foreign investment
16) Although Inco is a Canadian company, it has invested substantial business resources in activities outside Canada. This practice is referred to as:
Version 1
5
A) transnational commerce B) foreign direct investment C) international trade D) organizational diversification E) outsourcing
17) The investing of resources in business activities outside a firm's home country is referred to as:
A) international trade B) domestic direct investment C) transnational barter D) foreign direct investment E) outsourcing
18) The __________ is a treaty designed to remove barriers to the free flow of goods, services, and capital between nations.
A) Global Agreement on Tariffs and Commerce B) United Nations Treaty on Trade C) General Agreement on Tariffs and Trade D) Multinational Agreement on Tariffs and Commerce E) The ILO
19) After World War II, the West committed to removing trade barriers between nations because of what experience?
Version 1
6
A) the loss of production from the war B) retaliatory trade policies leading to the Depression C) the General Agreement on Tariffs and Trade D) massive waves of immigrants seeking jobs E) the shift away from production to consumption
20) Under the umbrella of GATT there have been eight rounds of negotiations among member states. The _______ was the most recent round of negotiations.
A) Uruguay Round B) Malaysian Symposium C) German Round D) New Zealand Symposium E) Cancun Round
21)
Which of the following was not an outcome of the Uruguay Round of the GATT?
A) reduced trade barriers B) extended GATT to cover services as well as manufactured goods C) established the World Trade Organization D) provided extended protection for patents, trademarks, and copyrights E) reduced agricultural subsidies
22)
If the Doha talks are ever completed, the biggest gain will come from what?
Version 1
7
A) trademarks B) agriculture C) intellectual property D) consumer goods E) manufactured goods
23) The agency established at the 1993 Uruguay Round to police the international trading system is the __________.
A) Global Trade Enforcement Administration B) World Tariff and Trade Bureau C) International Trade Enforcement Agency D) World Trade Organization E) The European bank of Reconstruction and Development
24) Suppose Petro Canada, an international oil company, had a complaint about a trade issue. The __________, a governing body established at the Uruguay Round in 1993 to police the international trading system, is an organization that Petro Canada could take its complaint to.
A) World Trade Organization B) International Trade Monitoring Bureau C) World Tariff and Trade Agency D) International Trade Monitoring Agency E) The United Nations
25)
The acronym WTO stands for:
Version 1
8
A) Western Trade Organization B) World Tax Organization C) World Trade Organization D) World Tariff Organization E) World Trade Operations
26) In the past decades, many countries, in addition to reducing trade barriers, have done what?
A) decreased production B) increased wages C) removed restrictions to FDI D) increased tariffs E) joined the United Nations
27)
Since 1992, most of the world's changes to FDI have done what?
A) blocked FDI B) created a more favourable environment for FDI C) had no impact on FDI D) decreased production E) decreased wealth
28) Which of the following is a major cause for lowering the trade barriers of markets and production?
Version 1
9
A) Technological change B) Increased labour mobility C) Elastic demand D) Corporate greed E) Consumer demand
29) _______ is the theory that predicts that the number of transistors on a computer chip doubles every 24 months.
A) Brennan's Theorem B) Bailey's Law C) Moore's Law D) Ivan's Law E) Global Micro Accelerant (GMA) Law
30)
By 2019 the number of Internet users around the world was estimated to be what?
A) 5 million B) 100 million C) 1 billion D) 4 billion E) 5 billion
31)
The Web is viewed as a global what?
Version 1
10
A) equalizer B) way of decreasing production C) force for decreasing FDI D) way of reaching businesses at the expense of consumer E) way for government to market to its population
32) _______ was not mentioned in our textbook as a major innovation in transportation technology.
A) Commercial jet aircraft B) Super freighters C) E-commerce D) The introduction of containerization E) Both containerization and e-commerce were not mentioned
33) As a result of a variety of innovations, the real costs of information processing and communication have __________ over the past two decades.
A) fallen slightly B) increased slightly C) remained constant D) fallen dramatically E) had no impact on the cost of international business
34) According to your textbook, between 1930 and 1990, the cost of a three-minute phone call between New York and London fell from $244.65 to $3.32. This decrease can be mainly contributed to
Version 1
11
A) open communication between governments. B) the advent of the microprocessor. C) continuing efforts to globalize. D) high corporate ethical standards. E) the deregulation of the telecommunications industry.
35)
Over the past fifty years, which country dominated the world trade picture?
A) China B) Canada C) The United Kingdom D) The United States E) India
36) The globalization of markets and production and the resulting growth of world trade, foreign direct investment, and imports all imply that firms are finding their home markets under attack from foreign competitors. This is most true in which country?
A) China B) Canada C) The United Kingdom D) The United States E) India
37) Many of the changes that countries have made pertaining to foreign direct investment regulations have:
Version 1
12
A) made it harder for foreign companies to enter their markets B) made it easier for foreign companies to enter their markets C) had no effect on the ease upon which foreign companies can enter their markets D) made it easier to foreign producers of raw materials to enter their markets but more difficult for foreign producers of finished products to enter their markets E) prevented the expropriation of business assets by a foreign government
38)
The steep drop in world trade occurred when?
A) 1950-1951. B) 1955-1956. C) 1995-1996. D) 2005-2006. E) 2008-2009.
39)
According to our textbook, the growing integration of the world economy is:
A) increasing the intensity of competition within the home market of a company in a wide range of manufacturing and service industries B) decreasing the intensity of global competition in manufacturing industries, and increasing the intensity of domestic competition in services C) increasing the intensity of global competition in manufacturing industries, and decreasing the intensity of domestic competition in services D) narrowing the scope of global competition in a wide range of service, commodity, and manufacturing industries E) Widening the opportunities for competing with manufacturing companies within their home market and narrowing the opportunities for competing with service companies in their home market.
Version 1
13
40) Although the characteristics of the global economy have changed dramatically over the past 50 years, as late as the 1960s all of the following demographic characteristics were true except:
A) the U.S. dominated the world economy B) small, U.S. entrepreneurial firms dominated the international business scene C) the U.S. dominated the world foreign direct investment picture D) the U.S. was the world's largest industrial power E) the U.S. dominated world trade
41)
Since the 1960s, what has been a notable trend regarding multinational enterprises?
A) the decline of the multinational enterprise B) the decline of the Canadian multinational enterprise C) the rise of non-U.S. multinationals D) the decline of the Japanese multinational enterprise E) the rise of U.S. multinationals
42) What kind of enterprise is a business that has productive activities in two or more countries?
A) cross-cultural B) multinational C) varied-national D) diverse-national E) multi-domestic
43)
Recently there has been _______ in the number of smaller firms that are multinationals.
Version 1
14
A) a significant growth B) no change C) a significant decline D) some growth E) some decline
44) General Electric Corporation has productive activities in a number of countries. As a result, it would be appropriate to refer to General Electric as a __________ corporation.
A) transnational B) diverse-national C) cross-national D) multinational E) global
45) Iceculture Inc., of Ontario exports around the world. It would be considered to be a ______ company
A) multinational B) transnational C) cross-border national D) mini-multinational E) U.S.- dominated
46) Since the 1960s, there have been two notable trends in the demographics of the multinational enterprise. These two trends have been:
Version 1
15
A) the rise of non-U.S. multinationals and the disappearance of mini-multinationals B) the decline of non-U.S. multinationals and the decline of mini-multinationals C) the decline of non-U.S. multinationals and the growth of mini-multinationals D) the rise of non-U.S. multinationals and the growth of mini-multinationals E) the rise of U.S. multinationals and the growth of mini-multinationals
47) If we look into the future, most forecasts now predict a __________ in world output accounted for by developing nations such as China, India, Indonesia, and South Korea, and a __________ in the share enjoyed by rich industrialized countries such as Britain, Japan, and the United States.
A) rapid rise; rapid decline B) slight rise; slight decline C) rapid decline; rapid rise D) rapid rise; slight decline E) stay the same; slight decline
48)
The relative decline of the developed countries' share of world output _______________.
A) will reduce the living standards of the citizens of developed countries. B) will increase competition for scarce resources and create political instability. C) reflects the growing economic and industrial strength of developing countries. D) will decrease prices but also reduce wages in Canada E) will decrease job opportunities in Canada
49)
Which of the following is an example of a developing nation?
Version 1
16
A) Thailand B) Britain C) Japan D) United States E) Canada
50)
In the 1960s, what was then seen as an economic threat to Europe?
A) The dominance of U.S. firms B) Technological innovations C) Low-cost transportation D) Low-cost global communication networks E) Reduction in trade barriers
51) Throughout the 1990s, the amount of investment directed at both developed and developing nations did what?
A) stayed the same B) decreased C) increased D) was highly variable E) decreased, then increased
52) Among developing nations, the largest recipient of foreign direct investment has been which country?
Version 1
17
A) China B) India C) Japan D) Canada E) the United States
53)
The economies of most of the former Communist countries can best be described as:
A) in poor condition with high risk associated with doing business there B) steady growth, especially since 2009 C) dominated by multinationals D) robust and growing stronger E) closed to many international businesses due to high tariffs
54) Which of the following statements is not true regarding the majority of Latin American countries?
A) governments are selling state-owned enterprises to private investors B) foreign investment is welcome C) debt and inflation are down D) neither democracy nor free market reforms have seemed to take hold E) None of these answers is correct
55)
The last quarter of the 20
Version 1
th
century experienced __________ in the global economy.
18
A) increased stability B) slow-moving C) virtually no changes D) rapid changes E) great concerns over potential disruptions
56) Economists argue that increased international trade and cross-border investments will result in __________ prices for goods and services.
A) higher B) stable C) lower D) unstable E) variable
57)
_______ is not a benefit of globalization.
A) Lowering prices for goods B) Raising the incomes of consumers C) Slowing economic growth D) Helping to create jobs in all countries that choose to participate E) More leisure time
58)
Benefits of globalization include:
Version 1
19
A) Falling barriers to trade and investment drive prosperity B) Increased trade and investment will lower prices for goods and services C) Increased income of consumers D) Creates jobs in all countries that participate in global trade E) All of these options
59) One frequently voiced concern about globalization is that it destroys manufacturing jobs in wealthy advanced economies such as Canada. The basic thrust of the critics' argument is:
A) developing nations will recruit employees from the more advanced economies, thereby depleting their labour pools B) globalization increases the pace of the shift from a world economy based on manufactured goods to a world economy based on services C) falling trade barriers allows firms to move their manufacturing activities offshore to countries where wage rates are much lower D) the governments of developing countries will heavily subsidize their primary industries, making competing products produced in advanced economies less attractive E) Canadian workers are overpaid and the true value of a manufacturing job is much lower
60)
Outsourcing has even extended to the Canadian _______ industry.
A) auto B) mineral extraction C) services D) home construction E) lumber
61) Critics use the following argument to suggest that globalization is a contributing factor to an increase in pollution.
Version 1
20
A) globalization results in an increase in the amount of activity that takes place in companies that do not have adequate pollution controls B) globalization results in increased commerce between countries, which results in an increase in the amount of transportation activity (e.g. trains, barges, air cargo, trucks, etc.) C) firms that operate in countries that have adequate pollution regulations have a tendency to move their manufacturing operations to countries that have less stringent or no pollution controls to avoid the cost of regulation D) globalization results in increased production, which has the undesirable side-effect of increased pollution E) people in developing countries are used to coping with more pollution
62)
What does the CUSMA stand for?
A) Canada-US-Mexico free trade agreement B) North American free trade agreement 2.0 C) Canadian Union of Shop Manufacturing Associations D) US-Canada-Mexico free trade agreement E) Canadian-American-Mexican free trade agreement
63) Many critics of globalization argue that outsourcing leads to increased use of _________ labour practices in developing countries.
A) exploitive B) fair C) underground D) neo-colonialist E) non-competitive
64)
What is the primary purpose of the World Trade Organization?
Version 1
21
A) arbitrate of trade disputes B) act as a "watchdog" for countries that lower their pollution standards in an effort to attract more foreign manufacturing activity C) set tariffs for countries that signed the GATT agreement D) monitor the implementation of trade agreements such as NAFTA E) reduce the number of job losses in member countries
65)
Supranational organizations such as the WTO are criticized for
A) interfering in the regulation of prices of a country's natural resources. B) ruling in favour of rich western countries at the expense of poor developing countries. C) focusing on economics and not on democracy and environmental responsibility. D) limiting its actions to what the WTO member states agree to. E) encouraging economic stagnation in poor countries so that rich countries can grow faster.
66)
The world's poorest nations have also faced __________.
A) standardization B) alignment C) global simplification D) economic stagnation E) consumerization
67) Managing an international business is different from managing a purely domestic business for all of the following reasons except:
Version 1
22
A) countries are different B) international transactions involve converting money into different currencies C) the range of problems confronted by a manager in an international business are narrower than those confronted by a manager in a domestic business D) an international business must find ways to work within the limits imposed by government intervention in the international trade and investment system E) different languages have to be learned
68)
The closing Tim Hortons case study is an example of what?
A) how easily Canadian firms can enter the US market B) the similarity of Canadian and US consumer tastes C) Canadian firms buying up US firms D) protests against globalization E) the difficulty of Canadian firms expanding internationally
69) The Sustainability in Practice section focuses on measures that the Adidas Group has taken to sustainability regarding: _______
A) supply chain management and supplier labour standards B) Supply chain management C) labour standards D) materials used in production E) efficient water and stormwater management
70) Describe the concept of globalization. What are the major opportunities and challenges that globalization has created for business organization?
Version 1
23
71) Describe the two main facets of globalization. Explain how each of these components of globalization has helped create the shift towards a more integrated world economy.
72) Describe the meaning of the term "trade barriers"? What measures have been taken by the world community to reduce the impact of trade barriers on international trade?
73)
Describe the impact of the development of the World Wide Web on global commerce.
74) Define the term "foreign direct investment (FDI)." How does the term "foreign direct investment" differ from the term "international trade?"
Version 1
24
75) You manage a company that produces and sells cameras that work under water. The camera bodies are made in China, in a facility your company owns, and which employs about 500 people. The electronics for the camera are bought from a supplier in South Korea. The lens and optics are made in your own facility in Japan, which employs about 300 people. The final product is also assembled and packaged at this facility in Japan. Your company currently employs about 350 people in Canada (head office functions, advertising, legal, and sales). You are a successful company, in business for many years, and you hope to expand your sales around the globe. What is this type of company called?
76) You manage a company that produces and sells cameras that work under water. The camera bodies are made in China, in a facility your company owns, and which employs about 500 people. The electronics for the camera are bought from a supplier in South Korea. The lens and optics are made in your own facility in Japan, which employs about 300 people. The final product is also assembled and packaged at this facility in Japan. Your company currently employs about 350 people in Canada (head office functions, advertising, legal, and sales). You are a successful company, in business for many years, and you hope to expand your sales around the globe. What are some other examples of this type of firm?
77) You manage a company that produces and sells cameras that work under water. The camera bodies are made in China, in a facility your company owns, and which employs about 500 people. The electronics for the camera are bought from a supplier in South Korea. The lens and optics are made in your own facility in Japan, which employs about 300 people. The final product is also assembled and packaged at this facility in Japan. Your company currently employs about 350 people in Canada (head office functions, advertising, legal, and sales). You are a successful company, in business for many years, and you hope to expand your sales around the globe. What have been the two most notable trends in these types of enterprises since the 1960s?
Version 1
25
78) Discuss the primary advantages and disadvantages of globalization. Do you believe the advantages outweigh the disadvantages? How can the effects of the disadvantages of globalization be reduced?
79) Country competitiveness is not something that is permanent or fixed. The dominant features of the global economy are the rapid changes relative economic and competitive status of different countries. Canada is not immune to these changes. We have seen our total share of the global economy decrease and the loss of many industries. The anti-globalization movement has been active in Canada. In particular they have been critical of multinational corporate power and argued against global and regional agreements on economic growth and the lowering of trade barriers. Others feel that globalization is inevitable and contributes to the well being of people around the world. a. Consider the overall impact of globalization on Canada from the perspective of a software developer-has it been positive or negative? Explain your answer. b. What kinds of strategies could a Canadian developer of software employ to reduce the negative impacts and take advantage of the positive aspects? Explain your answer.
80)
Why is international trade important to Canada?
Version 1
26
81) What measures can global companies take to prove a commitment to sustainability? Provide an example of a real company's practices.
82) The global economy is moving progressively towards a world in which national economies are relatively isolated from each other. ⊚ ⊚
true false
83) The volume of goods, services and investment crossing national borders expanded faster than did world output every year during the last two decades of the 20 th century. ⊚ ⊚ 84)
Currently global markets are mostly markets for consumer products. ⊚ ⊚
85)
true false
true false
To benefit from the globalization of markets, a company has to be a multinational firm. ⊚ ⊚
Version 1
true false
27
86) Currently most global markets are for industrial goods and materials that serve a universal need the world over. ⊚ ⊚
true false
87) Although many companies have lowered their overall cost structure and have improved the quality of their products by dispersing their production activities to locations around the world, this activity is confined primarily to large firms. ⊚ ⊚
true false
88) Sourcing goods and services from locations around the globe is known as the globalization of markets. ⊚ ⊚ 89)
true false
General Agreement on Tariffs and Trade is what the acronym GATT stands for. ⊚ ⊚
true false
90) As markets globalize and an increasing proportion of business activity transcends national borders, there is a need for institutions to help manage, regulate and police the global market place. ⊚ ⊚
Version 1
true false
28
91) The International Monetary Fund and the World Bank were both created in 1944 by 44 nations that met at Bretton Woods, New Hampshire. ⊚ ⊚
true false
92) The International Monetary Fund (IMF) is often seen as the leader of last resort to nation states whose economies are in economic turmoil. ⊚ ⊚ 93)
true false
FDI occurs when a firm invests resources in business activities outside its home country. ⊚ ⊚
true false
94) In addition to reducing trade barriers, many countries have also been progressively removing restrictions on barriers to foreign direct investment. ⊚ ⊚
true false
95) The advanced nations of the East committed themselves after World War II to removing barriers to the free flow of goods, services, and capital between nations. ⊚ ⊚
true false
96) There is very little evidence that suggests that the lowering of trade barriers has facilitated the globalization of production.
Version 1
29
⊚ ⊚
true false
97) Surprisingly, despite the importance of technology in our everyday lives, technological change has played only a minor role in the globalization of markets. ⊚ ⊚ 98)
true false
Since the 1960s, the U.S. has dominated the world economy ⊚ ⊚
true false
99) Most forecasts now predict a rapid rise in world output accounted for by developing nations such as China, India, and South Korea, and a rapid decline in the share enjoyed by rich industrialized countries such as Canada and the United States. ⊚ ⊚
true false
100) Many of tomorrow's economic opportunities may be found in the developing nations of the world. ⊚ ⊚
true false
101) In the 1960s global business activity was dominated by large Japanese multinational corporations.
Version 1
30
⊚ ⊚
true false
102) Beginning in the 1970s, European and Japanese firms began to shift labour-intensive manufacturing operations from their home markets to developing nations. ⊚ ⊚
true false
103) Although most international trade and investment is still conducted by large firms, small to medium sized firms are increasingly involved in international trade and investment. ⊚ ⊚ 104)
true false
An MNE is any firm that invests outside of its home country. ⊚ ⊚
true false
105) Between 1995 and 2000 most countries in Eastern Europe saw their Communist governments collapse. ⊚ ⊚
true false
106) If what is occurring in China continues for two more decades, China may move from a developing to an industrial superpower status even more rapidly than Japan did. ⊚ ⊚ Version 1
true false
31
107) The volume of cross-border trade and investment has been growing more rapidly than global output. ⊚ ⊚
true false
108) Economists argue that increased international trade and cross-border investments will result in higher prices for goods and services, although there are many benefits to globalization. ⊚ ⊚
true false
109) It is commonly believed that globalization stimulates economic growth, creates jobs, and raises income levels. ⊚ ⊚
true false
110) The United Kingdom's vote to withdraw from the European Union in 2016, known as "Brexit" can be seen as a popular protest vote. ⊚ ⊚
true false
111) If critics of globalization are correct, the decline in labour's share of national income must be due, in part, to moving production to low-wage countries. ⊚ ⊚
Version 1
true false
32
112) A concern by some is that free trade encourages the movement of manufacturing from developed countries to less developed countries. ⊚ ⊚ 113)
Free trade agreements can be tied to tougher environmental and labour laws. ⊚ ⊚
114)
true false
National sovereignty is not a concern for those critical of globalization. ⊚ ⊚
116)
true false
Some Canadian firms have outsourced jobs to developing countries. ⊚ ⊚
115)
true false
true false
Economic stagnation in some countries is caused in part by their form of government. ⊚ ⊚
true false
117) Managing an international business is not that different from running a purely domestic business.
Version 1
33
⊚ ⊚ 118)
true false
Members of the Fair Labour Association are not subject to independent monitoring. ⊚ ⊚
Version 1
true false
34
Answer Key Test name: chapter 1 1) C 2) C 3) D 4) B 5) D 6) D 7) D 8) A 9) C 10) A 11) C 12) D 13) B 14) A 15) C 16) B 17) D 18) C 19) B 20) A 21) E 22) B 23) D 24) A 25) C 26) C Version 1
35
27) B 28) A 29) C 30) D 31) A 32) C 33) D 34) B 35) D 36) A 37) B 38) E 39) A 40) B 41) C 42) B 43) A 44) D 45) D 46) D 47) A 48) C 49) A 50) A 51) C 52) A 53) A 54) D 55) D 56) C Version 1
36
57) C 58) E 59) C 60) C 61) C 62) A 63) A 64) A 65) C 66) D 67) C 68) E 69) A 82) FALSE 83) TRUE 84) FALSE 85) FALSE 86) TRUE 87) FALSE 88) FALSE 89) TRUE 90) TRUE 91) TRUE 92) TRUE 93) TRUE 94) TRUE 95) FALSE 96) FALSE 97) FALSE 98) TRUE Version 1
37
99) TRUE 100) TRUE 101) FALSE 102) TRUE 103) TRUE 104) FALSE 105) FALSE 106) TRUE 107) TRUE 108) FALSE 109) TRUE 110) TRUE 111) TRUE 112) TRUE 113) TRUE 114) TRUE 115) FALSE 116) TRUE 117) FALSE 118) FALSE
Version 1
38
Student name:__________ 1)
According to the opening case, China is no longer dependent on Hong Kong for:
A) supply chain management B) high tech goods C) the manufactured goods D) the service economy E) a links to international trade
2) Collectively, we refer to political, economic, and legal systems as constituting the _______ economy of a country.
A) domestic B) civic C) administrative D) political E) governing
3)
The economy and legal systems of a country are shaped by its what?
A) civil system B) political economy C) political system D) judicial economy E) governance structure
4)
Political systems can be assessed according to two related dimensions:
Version 1
1
A) the degree to which they emphasize individualism opposed to totalitarian and the degree to which they are individualistic verses democratic B) the degree to which they are market orientated opposed to production orientated and the degree to which they are democratic verses individualistic C) the degree to which they emphasize social democracy opposed to communism and the degree to which they emphasize collectivism opposed to individualism D) the degree to which they emphasize collectivism opposed to individualism and the degree to which they are democratic or totalitarian E) the degree to which they emphasize capitalism as opposed to communism and the degree to which they emphasize cultural freedom as opposed to cultural monitoring
5) The two dimensions of political systems are interrelated; systems that emphasize _______ tend towards totalitarianism, while systems that place a high value on _______ tend to be democratic.
A) individualism; collectivism B) collectivism; individualism C) socialism; individualism D) individualism; socialism E) theocracy; capitalism
6) __________ refers to a system that stresses the primacy of collective goals over individual goals.
A) Collectivism B) Capitalism C) Individualism D) Totalitarian E) Democracy
Version 1
2
7) When __________ is practiced, the needs of society as a whole are generally viewed as being more important than individual freedoms.
A) totalitarianism B) collectivism C) individualism D) capitalism E) theocracy
8) _______ is consistent with the notion that an individual's right to do something may be restricted because it runs counter to "the good of society" or "the common good."
A) Totalitarian B) Collectivism C) Autocratic D) Capitalism E) Platonism
9)
Modern __________ trace their intellectual roots to Karl Marx.
A) Separatists B) Capitalists C) Individualists D) Socialists E) Federalists
10) The group that believed that socialism could be achieved only through violent revolution and totalitarian dictatorship were referred to as:
Version 1
3
A) Communists B) Fascists C) Political democrats D) Collectivists E) Mensheviks
11) Followers of socialist ideology who commit themselves to achieving socialism through democratic reforms are called:
A) Communists B) Social democrats C) Individualists D) Political democrats E) New democrats
12)
The communist version of socialism reached its high point in the late ________.
A) 1940s B) 1950s C) 1960s D) 1970s E) 1980s
13)
What country is the last major Communist power left?
Version 1
4
A) Russia B) China C) Vietnam D) North Korea E) Cuba
14)
Social democracy has had its greatest influence in the following group of countries:
A) Canada, United States, Mexico, and Spain B) India, Pakistan, Burma, Nepal, Sri Lanka, and Bhutan C) Brazil, Chile, Uruguay, Ecuador, Columbia, and French Guiana D) Australia, Britain, France, Germany, Norway, Spain, and Sweden E) Australia, Columbia, Venezuela, Cambodia, Brazil
15)
Experience has demonstrated that state ownership of the means of production:
A) often runs in parallel with the public interest B) is the most profitable way to organize production C) is the most efficient way to organize production D) often runs counter to the public interest E) leads to increased inefficiency, higher prices and higher taxes
16)
Which of the following definitions best describes the concept of individualism?
Version 1
5
A) Political system in which an individual is governed by laws created to limit corruption and exploitation. B) Political system in which government is by the people, exercised either directly or through elected representatives. C) Political system that stresses the primacy of collective goals over individual goals. D) Form of government in which one person or political party exercises absolute control over all spheres of human life and in which opposing political parties are prohibited. E) Political philosophy that an individual should have freedom over his or her economic and political pursuits.
17)
Which of the following can be traced to an ancient Greek philosopher, Aristotle?
A) collectivism B) individualism C) socialism D) totalitarianism E) theocracy
18) In contrast to collectivism, __________ stresses that the interests of the individual should take precedence over the interests of the state.
A) totalitarianism B) socialism C) individualism D) collectivism E) tribalism
19)
Individualism is built on two central themes:
Version 1
6
A) socialism is the preferred political philosophy and an emphasis on the importance of collective interests over individual interests B) an emphasis on the importance of collective interests over individual interests and the belief that the welfare of society is best served by letting a collective body determine what is in society's best interest rather than individuals C) the needs of society as a whole are more important than individual freedoms and the welfare of society is best served by letting a collective body determine what is in society's best interest rather than individuals D) the public good is more important than corporate profits and the people exist to serve the state E) an emphasis on the importance of guaranteeing individual freedom and selfexpression and the belief that the welfare of society is best served by letting people pursue their own economic self-interest
20) The Cold War was essentially a war between __________, championed by the nowdefunct Soviet Union, and __________, championed by the United States.
A) collectivism; individualism B) democracy; socialism C) socialism; totalitarianism D) individualism; collectivism E) Stalinism; Reaganism
21) Which of the following is the political system in which government is by the people, exercised either directly or through elected representatives?
A) despotism B) democracy C) totalitarianism D) collectivism E) tribalism
Version 1
7
22) __________ is a form of government in which one person or political party exercises absolute control over all spheres of human life, and opposing political parties are prohibited.
A) Capitalism B) Totalitarianism C) Democracy D) Collectivism E) Theocracy
23)
_______ go "hand in hand."
A) Anarchy and individualism B) Collectivism and individualism C) Totalitarianism and democracy D) Democracy and collectivism E) Democracy and individualism
24) A political system in which citizens periodically elect individuals to represent them is referred to as a __________.
A) participatory collective B) totalitarianism democracy C) representative democracy D) socialistic democracy E) parliamentary democracy
25) In a representative democracy, if elected representatives fail to perform their job adequately, what will happen?
Version 1
8
A) a socialist democracy will take over B) a federalist republic will take over C) a collectivist federation will take over D) they will be voted out of office in the next election E) they will hold their offices for life
26) To guarantee that elected representatives can be held accountable for their actions by the electorate, an ideal representative democracy has a number of safeguards. Which of the following is not an example of a safeguard in an ideal representative democracy?
A) a fair court system that is independent from the political system B) universal adult suffrage C) an individual's right to freedom of expression, opinion, and organization D) a political police force and armed services E) regular elections
27) _______ is a form of totalitarianism that advocates achieving socialism through totalitarian dictatorship.
A) Tribal totalitarianism B) Democratic totalitarianism C) Communist totalitarianism D) Collective totalitarianism E) Theocratic totalitarianism
28)
There are four major forms of totalitarianism in the world today. These are:
Version 1
9
A) collective, Marxist, right-wing, and ancestral B) theocratic, democratic, tribal, and communist C) communist, theocratic, tribal, and right-wing D) ancestral, Marxist, left-wing, and compiled E) tribal, Maoist, right-wing, and dictatorial
29)
All of the following are forms of totalitarianism except:
A) right-wing B) ancestral C) theocratic D) tribal E) communistic
30) A form of totalitarianism in which political power is monopolized by a party, group, or individual that governs according to religious principles is called __________.
A) right-wing totalitarianism B) theocratic totalitarianism C) ancestral totalitarianism D) tribal totalitarianism E) fundamental totalitarianism
31)
In which region of the world is tribal totalitarianism found?
Version 1
10
A) Africa B) Australia C) South America D) Asia E) Central America
32) Right-wing __________ generally permits individual economic freedom, but restricts individual political freedom on the grounds that it would lead to a rise of communism.
A) socialism B) collectivism C) capitalism D) totalitarianism E) tribalism
33)
Which of the following are the three broad types of economic systems?
A) market economy, combined economy, production economy B) market economy, post-industrial economy, industrial economy C) combined economy, separate economy, mixed economy D) ordinance economy, production economy, political economy E) market economy, command economy, mixed economy
34)
All of the following are types of economic systems except:
Version 1
11
A) market economy B) command economy C) mixed economy D) progressive economy E) none of the answers are an example of a type of economic system
35) In a pure __________ economy the good and services that a country products, and the quantity in which they are produced, is not planned by anyone. Rather it is determined by the interaction of supply and demand and signaled to producers through the price system.
A) ordinance B) market C) command D) combined E) free
36) In a pure command economy, the goods and services that a country produces, the quantity in which they are produced, and the prices at which they are sold are all planned by:
A) private industry B) local trade associations C) individual entrepreneurs D) the government E) citizen committees
37) A _______ is an economic system in which the goods and services produced, the quantity in which they are produced, and the prices at which they are sold are all planned by the government.
Version 1
12
A) civic economy B) administrative economy C) command economy D) market economy E) post-industrial economy
38) In a pure __________ economy all businesses are state owned so the government can direct them to make investments that are in the best interests of the nation as a whole, rather than in the interest of private individuals.
A) command B) mixed C) market D) state-directed E) new
39) In a __________ economy, certain sectors of the economy are left to private ownership and free market mechanisms, while in other sectors there is significant state ownership and government planning.
A) command B) combined C) mixed D) political E) socialist
40) What kind of economies were once very common throughout much of the world, although they are becoming less so?
Version 1
13
A) mixed B) state-directed C) command D) market E) regulated
41) Canada could be described as having elements of both a __________ economy and a ___________ economy.
A) command; mixed B) mixed; regional C) market; regional D) command; regional E) market; mixed
42)
The __________ is influenced by the prevailing political system.
A) corporate system B) economic system C) technological system D) market system E) democratic
43) The __________ of a country refers to the rules that regulate behaviour, along with the processes by which the laws of a country are enforced and through which redress for grievances is obtained.
Version 1
14
A) political system B) administrative system C) economic structure D) legal system E) ethical system
44) The _______________ system evolved in England over hundreds of years and is based on tradition, precedent, and custom.
A) civil B) theocratic C) common law D) economic law E) contract law
45) A _______________ law system is based on a very detailed set of laws organized into codes.
A) judicial B) theocratic C) common D) traditional E) civil
46)
A law system that is based primarily on religious teachings, refers to a
Version 1
15
A) civil law system. B) theocratic law system. C) common law system. D) traditional law system. E) canon law system.
47)
Quebec is the only province in Canada to use the _____________ law system.
A) common B) French C) canon D) civil E) judicial
48) Phillip is in the process of writing up a document that states his company will provide consulting on network applications for the next two weeks, for a specified amount of money. Phillip is in the process of creating what?
A) a contract B) a contract law C) property law D) private action suit E) a memorandum of understanding
49) The parties to an agreement normally resort to _______________ when one party feels the other has violated either the letter of the spirit of the agreement.
Version 1
16
A) property law B) arbitration C) third-party mediator D) contract law E) the courts
50) The _________________ establishes a uniform set of rules governing certain aspects of the making and performance of everyday commercial contracts between sellers and buyers.
A) United Nations Convention on Contracts for the International Sale of Goods B) The foreign practices act C) State directed economy D) The United Nations Human Development E) The Canadian Government
51) The bundle of legal rights over the use to which a resource is put; and over the use made of any income that may be derived form that resource are called __________ rights.
A) statutory B) asset C) taxable D) property E) users
52) The violation of _______________ can be violated in two ways—through private action and through public action.
Version 1
17
A) patents B) copyrights C) warrants D) property rights E) individual rights
53) The Canadian legislation that makes bribery of a foreign official by a Canadian business person a criminal offense is known as what?
A) Foreign Corrupt Practices Act B) Copyright infringement C) Corruption Perceptions Index D) Law OECD 1998 E) Bill S-21
54)
Which of the following describes the concept of intellectual property?
A) Exclusive legal rights of authors, composers, playwrights, artists, and publishers to publish and dispose of their work as they see fit. B) Property, such as computer software, screenplays, musical scores, or chemical formulas for new drugs, that is the product of intellectual activity. C) Designs and names, often officially registered, by which merchants or manufacturers designate and differentiate their products. D) Document giving the inventor of a new product or process exclusive rights to the manufacturer, use, or sales of that invention. E) Property that can be digitized and copied
55) Suppose you invent a new product and want to obtain the exclusive rights to manufacture the product. To protect yourself, you should apply for a __________ on the product.
Version 1
18
A) trust B) patent C) copyright D) trademark E) logo
56) Suppose Apple corporation develops a new type of phone. Apple can protect its invention through what kind of protection?
A) warrant B) patent C) copyright D) trademark E) contract
57) __________ are the exclusive legal rights of authors, composers, playwrights, artists, and publishers to publish and dispose of their work as they see fit.
A) Patents B) Copyrights C) Trusts D) Licenses E) Franchises
58) A composer is able to protect an original musical score from being copied and sold by someone else through __________ protection.
Version 1
19
A) patent B) warrant C) trademark D) copyright E) logo
59) __________ are designs and names, often officially registered, by which merchants or manufacturers designate and differentiate their products.
A) Copyrights B) Patents C) Warrants D) Trademarks E) Logos
60) As a result of __________ protection, the Nike "swoosh" logo is protected from being used by any other shoe manufacturer.
A) logo B) copyright C) patent D) warrant E) trademark
61)
Patents, copyrights, and trademarks are examples of __________ property laws.
Version 1
20
A) intellectual B) administrative C) official D) central E) individual
62) "Windows" is a computer operating system that is an exclusive __________ of the Microsoft corporation.
A) sticker B) hallmark C) registry D) trademark E) brand
63)
Generally speaking, international laws about intellectual property rights are _______.
A) Not part of TRIPS B) Not affected by the lobbying of specific firms C) Roughly the same as they were two decades ago D) Being weakened E) Being strengthened
64)
_______________ set certain safety standards to which a product must adhere.
Version 1
21
A) Turnout safety laws B) Product liability laws C) Product safety laws D) Contract liability laws E) Civil laws
65) __________ liability involves holding a firm and its officers responsible when a product causes injury, death, or damage.
A) Turnout B) Contract C) Product D) Outcome E) Business
66) According to the textbook, the shadow economy includes the following unofficial transactions
A) Unrecorded cash B) Barter agreements C) Unreported assets D) A and B E) All of these options
67) ___________ allows for a more direct comparison of living standards in different countries.
Version 1
22
A) PPP B) UPN C) EOC D) IOF E) GNI
68)
GNP is increasingly being replaced by ______.
A) PPP B) Atlas conversion C) GNI D) Atlas methodology E) IOF
69)
What does the acronym GNP stand for?
A) gross national profile B) gross national product C) gradual notational profile D) general natural productivity E) government natural product
70)
PPP is an acronym that stands for:
A) power purchasing procedures B) procurement priority procedures C) priority patent procedures D) purchasing power parity E) parallel parametric purchasing
Version 1
23
71)
In 2001, the World Bank has chosen to replace GNP with ________.
A) GDP B) aggregate demand and aggregate supply C) GRP D) PPP E) GNI
72) The United Nations __________ index is based on life expectancy, literacy rates, and whether average incomes are sufficient to meet the basic needs of life in a country.
A) Human Development B) Standard of Living C) Quality of Life D) Economic Development E) UNICEF
73) Amartya Sen believed that development should be assessed more by measures such as ___________.
A) Aggregate demand B) Aggregate supply C) PPP D) HDI E) GNP
74) The Human Development Index is scaled from 0 to 1. Countries scoring less than _______ are classified as low human development (the quality of life is poor).
Version 1
24
A) 25 B) 50 C) 75 D) 33 E) 65
75) There is fairly wide agreement that __________ and __________ are the engines of longrun economic growth.
A) small business; free markets B) government; consumer demand C) innovation; entrepreneurship D) agriculture; manufacturing E) exports; domestic sales
76) What is the process through which people create new products, new processes, new organization, new management practices, and new strategies called?
A) bureaucracy B) administration C) development D) innovation E) invention
77) It has been argued that the economic freedom associated with a __________ economy creates greater incentives for innovation than either a planned or mixed economy.
Version 1
25
A) production B) market C) commercial D) manufacturing E) consumer
78) Besides a country's political and economic systems, another driver of economic development includes?
A) PPP B) Geography C) History D) UN E) ITB
79) Since the late 1980s two major trends have emerged in the political economies of many of the world's national states. These are:
A) a wave of communist revolutions have swept the world and there has been a strong move away from free market economies toward more centrally planned economies. B) a wave of socialistic revolutions have swept the world and there has been a strong move away from free market economies toward more centrally planned and mixed economies. C) a wave of democratic revolutions have swept the world and there has been a strong move away from centrally planned and mixed economies toward more free market economies. D) a wave of totalitarian revolutions have swept the world and there has been a strong move away from centrally planned and mixed economies toward more free market economies. E) a wave of consumer empowerment and there has been a strong move away from common law and towards civil code.
Version 1
26
80) Which of the following is one of the three main reasons for the spread of democracy worldwide?
A) the spread of democracy has been unchallenged worldwide B) in many countries the economic advances of the past 25 years have led to the emergence of increasingly prosperous middle and working classes, which have pushed for democratic reforms C) geography D) privatization E) intellectual property rights
81) Political scientist _________ believes there is no universal civilization based on widespread acceptance of Western liberal democratic ideals.
A) Samuel Huntington B) Francis Fukuyama C) Michael Porter D) Paul Krugman E) John Maynard Keynes
82)
Privatization refers to:
A) the selling of state-owned enterprises to private investors B) the selling of public corporations to private investors C) guarding company secrets from the general public D) transferring political power from the government to private citizens E) reducing regulation of private business
83)
_________ is the process of selling state-owned enterprises to private investors.
Version 1
27
A) Political-economic divestiture B) Privatization C) Downsizing D) Ownership-transfer E) Nationalization
84) The shift to ________ system typically involves deregulation, privatization and a legal system that protects property rights.
A) a democratic B) a market-based economic C) privatized D) a state-ownership E) Communist
85) Which of the following involves removing legal restrictions to the free play of markets, the establishment of private enterprises, and the manner in which private enterprises operate?
A) privatization B) simplification C) deregulation D) socialism E) competition
86) The __________ movement started in Britain in the early 1980s when then-Prime Minister Margaret Thatcher started to sell state-owned assets.
Version 1
28
A) modification B) simplification C) privatization D) deregulation E) anti-nationalization
87) _____________ transfers the ownership of state property into the hands of private individuals.
A) Privatization B) Simplification C) Deregulation D) Socialism E) Nationalization
88) Without a ________ the incentive to engage in economic activity can be reduced substantially by private and public entities.
A) Political system B) Legal system C) Freedom system D) Accounting system E) Property system
89)
An example of an institutional weakness that undermines contract enforcement is what?
Version 1
29
A) Monetary systems B) Freedom indices C) Entrepreneurship D) Privatization E) Court capacity
90) A World Bank study suggests that post-Communist states that successfully transformed their economies followed what type of economic policy?
A) Monetary policy B) Privatization C) Changing political economy D) Shock therapy E) Socialism
91) Around the world, the tide has turned against command economies in favour of free markets and what?
A) Monetary policy B) Socialism C) Dictatorships D) Fiscal policy E) Democracy
92) What is meant by the term "political system?" What are the two related dimensions by which a political system can be assessed?
Version 1
30
93) Describe the difference between collectivism and individualism. Are these two ideologies compatible or in direct conflict? Which ideology seems to be gaining ground and which ideology is waning? Is this good news or bad news for international commerce? Explain your answer.
94) A political system can be described in terms of whether it is more oriented towards collectivism or individualism. Is Canada oriented more towards collectivism or individualism?
95) Draw a distinction between democracy and totalitarianism. Which political system facilitates the development of a free market economic system? Why?
96) What is intellectual property? What is the philosophy behind intellectual property law? Why is it so important to protect intellectual property rights? Are the laws that protect intellectual property rights fairly consistent across nations, or do they vary widely? Is this a problem?
Version 1
31
97) A Canadian developer of software for automated coal mining equipment has been approached by a Russian mining conglomerate with an offer to cooperate on adapting the software to the Russian market. If the Canadian company agreed to work with the Russian company, they would have to reveal the software's source code (the source code is the key to software and is used to protect proprietary technology). What are the "pros" of entering such an agreement?
98) How important is innovation in economic progress? Does innovation have a better chance of catching hold in a market economy or a planned economy? Explain your answer.
99) The closing case on Tunisia's legacy of corruption describes how it led to continued restrictions on domestic and foreign investment. What are the costs to the country of restricting FDI and of corruption? What changes would be needed to address the costs?
100)
The political, economic, and legal systems of a country are called the political economy. ⊚ ⊚
true false
101) A system that stresses the primacy of collective goals over individual goals is called collectivism.
Version 1
32