Chapter 16

Question 1

Autarky

Answer 1

(noncooperation and nationalism)
Example North Korea

Question 2

Hegemony

Answer 2

(noncooperation and globalization)

Example Russia

Question 3

Multilateralism

Answer 3

(cooperation and globalization)

Example Germany

Question 4

Bilateralism

Answer 4

(cooperation and nationalism)

refers to cooperation between two countries. A

Question 5

Event risk

Answer 5

Events we know the timing but not outcome.

Ex: Elections

Question 6

Exogenous risk

Answer 6

refers to unanticipated events

Ex: War or natural disasters

Question 7

Thematic risk

Answer 7

refers to known factors that have effects over long periods.

Ex: human migration pattern, climate change, risk from terroist attacks, cyber risks.

Question 8

Black Swan

Answer 8

Exogenous risk with low likelihood of occurrence, but a high short-term impact

Question 9

Low-Velocity Classification

Answer 9

A low-velocity classification describes a geopolitical risk that will take a long time to impact investment values. Risks that land in the environmental, social, and governance area tend to be low-velocity risks.

Question 10

Describe Geopolitical Risk

Answer 10

Geopolitical risks often have greater impacts during recessions than they would likely have during expansions.

Geopolitical risks may have discrete impacts on specific companies or industries as well as broad impacts on countries and regions. Scenario analysis is a technique for modeling the potential impacts of geopolitical risks.

Question 11

IMF International monetary Fund (5 bullet points)

Answer 11

-Promoting international monetary cooperation

-Facilitating the expansion and balanced growth of international trade

-Promoting exchange stability

-Assisting in the establishment of a multilateral system of payments

-Making resources available (with adequate safeguards) to members experiencing balance of payments difficulties

Question 12

World Bank and their two institutions

Answer 12

Vital source of tech assistant to developing counties around the world.

Mission is to fight poverty and help provide resources

Two Institutions:
IBRD (International bank of reconstruction and development)

IDA (international development association)

Question 13

World Trade Organization (WTO)

Main functions and Trading systems

Answer 13

only international org. that deal with global rules of trade between nations.

Main function is to ensure that trade flows smoothly , predictably, and freely as possible.

Multilateral trading system:
- WTO agreements negotiated, signed, and ratified in law by making large majority of trading nations.

-The agreements are legal ground rules for international commerce to guarantee member country trade rights.