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Flashcards in BUSB 342 MID-TERM 1 Deck (45)
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1

The shift toward a more integrated and interdependent world economy is referred to as globalization. T or F

True

2

A company does not need to be large in size to facilitate the globalization of markets. T or F

True

3

Companies hope to lower their overall cost structure to improve the quality or functionality of their product offering through globalization of production. T or F

True

4

The largest of all global markets, currently, are markets for consumer products. T or F

False

5

Outsourcing is a process that is limited to manufacturing enterprises.

False

6

The health care sector in the U.S. cannot avail the benefits of outsourcing to low-cost producers in other nations because of the nature of the work. T or F

False

7

The World Bank has focused on policing the world trading system and making sure nation-states adhere to the rules laid down in trade treaties. T or F

False (WTO)

8

The World Bank is known as the lender of last resort. T or F

False (IMF)

9

A few of the UN's central mandates are the promotion of higher standards of living, full employment, and conditions of economic and social progress and development. T or F

True

10

In 2008 and 2009, the GATT became the forum through which major nations attempted to launch a coordinated policy response to the global financial crisis, which started in America. T or F

False

11

The expansion of world trade implies that nations are becoming less dependent on each other for important goods and services. T or F

False

12

Over the past 30 years the flow of FDI has accelerated faster than the growth in the world trade and world output. T or F

True

13

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 homes markets protected from foreign competitors. T or F

False

14

In a totalitarian country, there are safeguards to protect an individual's right to freedom of expression, opinion, and organization. T or F

False

15

It is possible to have a totalitarian state that is hostile to collectivism and where some degree of individualism is encouraged. T or F

True

16

In a market economy, if demanded for a product exceeds supply, prices will rise, signaling to producers to produce more. T o F

True

17

The number of command economies has fallen dramatically since the demise of communism in the late 1980s. T or F

True

18

The objective of the government in a command economy is to encourage free and fair competition between private producers. T or F

False

19

In a command economy, enterprises have little incentive to control costs and be efficient, because they cannot go out of business. T or F

True

20

In mixed economies, governments also tend to take into state ownership troubled firms whose continued operation is thought to be vital to national interests. T or F

True

21

Gross National Income per-capital data take into account differences in the cost of living. T or F

False

22

GNI per capita can be adjusted by purchasing power to account for differences in the cost of living. T or F

True

23

GNI allows a more direct comparison of living standards in different countries. T or F

False

24

The base for the purchasing power parity adjustment of the GNI is the cost of living in the United States. T or F

True

25

GNI and PPP data are useful because they provide a dynamic analysis of economic development. T or F

False

26

Since the collapse of communism at the end of the 1980s, the erstwhile communist nations have transformed their economies by globalizing their markets. This involves:

A. regulating markets
B. privatizing state-owned enterprises
C. decreasing competition
D. reducing foreign investment

B. privatizing state-owned enterprises

27

Which of the following is a consequence of globalization?

A. Decreasing interdependence between national economies
B. Increasing outsourcing of services
C. Differentiation of material culture
D. Increase in barriers to cross-border trade

B. Increasing outsourcing of services

28

Which of the following has enabled globalization of markets?

A. Differentiation amongst national markets
B. Falling barriers to cross border trade
C. Reduced homogeneity of material culture across the world
D. Increased government ownership of fasctors of productions

B. Falling barriers to cross border trade

29

Which of the following factors hinders globalization of consumer goods market?

A. National differences in tastes and preferences
B. Higher production costs in developed nations
C. Homogenization of material culture
D. Increasing outsourcing of goods and services

A. National differences in tastes and preferences

30

Globalization of markets results in markets becoming___.

A. less interdependent
B. less diverse
C. more protected
D. less competitive

B. less diverse