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International MGNT > Chapter 1 > Flashcards

Chapter 1 Flashcards

1
Q
  1. _____ is the process of applying management concepts and techniques in a multinational environment and adapting management practices to different economic, political, and cultural environments.
A

International management

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2
Q
  1. To qualify as a multinational corporation (MNC), a firm must meet all of the following criteria except:
    A. operations in more than one country.
    B. international sales.
    C. a mix of nationalities among managers and owners.
    D. sales of at least one million dollars per year.
A

sales of at least one million dollars per year.

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3
Q
  1. Critics of globalization believe that:
    A. the offshoring of business services jobs to lower-wage countries inherently creates greater opportunities at home.
    B. growing trade deficits and slow wage growth are damaging economies.
    C. when production moves to countries to take advantage of less-regulated environments, an upward pressure is created on wages and working conditions.
    D. the main winners of globalization are the low-wage workers.
A

growing trade deficits and slow wage growth are damaging economies.

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4
Q
  1. The subcontracting or contracting out of activities to external organizations that had previously been performed by a firm is called
    A. homesourcing
    B. insourcing
    C. offshoring
    D. outsourcing
A

outsourcing

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5
Q
  1. _____ is the process by which companies undertake some activities at offshore locations instead of in their countries of origin.
    A. Homesourcing
    B. Insourcing
    C. Offshoring
    D. Globalization
A

Offshoring

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6
Q
  1. The _____ is the global organization of countries that oversees rules and regulations for international trade and investment, including agriculture, intellectual property, services, competition, and subsidies.
    A. WTO
    B. NAFTA
    C. WIPO
    D. ITO
A

WTO

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7
Q
  1. The _____ is a free-trade agreement among the United States, Canada, and Mexico that has removed most barriers to trade and investment.
    A. AFTA
    B. EFTA
    C. CAFTA
    D. NAFTA
A

NAFTA

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8
Q
  1. Identify a true statement about the Development Round in which the members of the World Trade Organization (WTO) met and launched a round of negotiations at Doha, Qatar in November 2011.
    A. The WTO members agreed upon the opening of government procurement markets to companies in the developed nations.
    B. There was a lack of consensus among WTO members regarding agricultural subsidies.
    C. There was a lack of consensus among WTO members regarding unbalanced population pyramids.
    D. The WTO members agreed upon the issues of competition.
A

There was a lack of consensus among WTO members regarding agricultural subsidies.

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9
Q
  1. The United States, Canada, and Mexico make up the _____, which in essence has removed all barriers to trade among these countries and created a huge North American market.
    A. General Agreement on Tariffs and Trade
    B. North American Common Market
    C. North American Free Trade Agreement
    D. North American Trade Union
A

North American Free Trade Agreement

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10
Q
  1. Agreements like NAFTA and CAFTA:
    A. not only reduce barriers to trade but also require additional domestic legal and business reforms in developing nations to protect property rights.
    B. do not include supplemental commitments like the FTAA does on labor and the environment to encourage countries to upgrade their working conditions and environmental protections.
A

not only reduce barriers to trade but also require additional domestic legal and business reforms in developing nations to protect property rights.

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11
Q
  1. In the context of the changing global demographics, identify a change that will be seen in developed nations.
    A. Developed Asian nations will be able to easily replace the retiring, aging population.
    B. In Japan, the number of nonworkers will be nearly equal to that of workers by 2050.
    C. In South Korea, the immigration policy will ease by 2050.
    D. In Germany, there will be a removal of restrictions on agricultural products, auto parts, and energy goods.
A

In Japan, the number of nonworkers will be nearly equal to that of workers by 2050.

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12
Q
  1. According to some critics, agreements like North American Free Trade Agreement (NAFTA) and Central American Free Trade Agreement (CAFTA):
    A. have been successful in ensuring environmental standards.
    B. have been successful in preventing the decline of the global working-age population.
    C. do not go far enough in ensuring worker rights.
    D. do not go far enough in protecting property rights.
A

do not go far enough in ensuring worker rights.

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13
Q
  1. The Asian economic block, made up of Indonesia, Malaysia, the Philippines, Singapore, Brunei, Thailand, Cambodia, Myanmar, and Vietnam, is referred to as the:
    A. Association of Southeast Asian Nations (ASEAN).
    B. Southeast Asia Free Trade Agreement (SWAFTA).
    C. Southeast Asia Common Market.
    D. Asian Economic Union.
A

Association of Southeast Asian Nations (ASEAN).

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14
Q
  1. A method that adjusts GDP to account for different prices in countries is called:
    A. cumulative distribution function.
    B. nominal GDP.
    C. current currency exchange rate.
    D. purchasing power parity.
A

purchasing power parity.

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15
Q
  1. Unlike the Group of Seven (G7) economies, the Emerging Seven (E7) economies are:
    A. primarily located in North America and Europe.
    B. located throughout Latin America and Asia.
    C. mature economies in which economic growth is slow.
    D. incentivizing citizens to have more children.
A

located throughout Latin America and Asia.

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16
Q
  1. Which of the following statements is true according to the reports that were released in 2004 and 2011 by the Goldman Sachs global economics team?
    A. The economies of Russia and Brazil would remain unaffected by the low prices for oil and other commodities in the years 2015 and 2016.
    B. The BRIC (Brazil, Russia, India, and China) economies’ share of world growth could rise significantly from 2003 to 2025.
A

The BRIC (Brazil, Russia, India, and China) economies’ share of world growth could rise significantly from 2003 to 2025.

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17
Q
  1. _____ is the term used to indicate the amount invested in property, plant, and equipment in another country.
    A. Exporting
    B. Foreign direct investment
    C. Importing
    D. Trade imperfection
A

Foreign direct investment

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18
Q
  1. According to the World Trade Organization, in 2014 merchandise exports:
    A. reached a record high.
    B. declined for the first time since 1983.
    C. remained fairly consistent.
    D. decreased by almost 50 percent.
A

reached a record high.

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19
Q
  1. In 2009, global FDI _____.
    A. nearly doubled
    B. nearly tripled
    C. dropped substantially
    D. remained fairly constant
A

dropped substantially

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20
Q
  1. By 2017, foreign direct investment (FDI) is estimated to:
    A. surpass the all-time high set a decade earlier in 2007.
    B. reach an all-time low due to political instability and uncertain markets.
    C. experience a significant drop similar to the global recession of 2009.
    D. experience an insignificant rise due to a slow rate of increase of merchandise exports.
A

surpass the all-time high set a decade earlier in 2007.

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21
Q
  1. In the context of the shifting balance of economic power in the global economy, which of the following factors has helped boost incomes and wealth in the African continent between 2000 and 2015?
    A. A one-child policy
    B. An increase in the price of agricultural products
    C. An increase in the size of the elderly population
    D. An easy immigration process for workers
A

An increase in the price of agricultural products

22
Q
  1. Which of the following economies is projected to become the largest by 2050 using market exchange rates?
    A. China
    B. India
    C. Australia
A

China

22
Q
  1. The Trans-Pacific Partnership (TPP) is a trade agreement among 12 Pacific Rim countries, including:
    B. Great Britain, New Zealand, and China.
    C. India, Canada, and Australia.
    D. Singapore, Russia, and Chile.
A

Peru, the United States, and Vietnam.

23
Q
  1. A _____ is comparable to a monopoly in the sense that an organization, in this case the government, has explicit control over the price and supply of a good or service.
    A. command economy
    B. market economy
    C. mixed economy
    D. socialist economy
A

command economy

24
Q
  1. Identify a characteristic of a market economy.
    A. The state reserves the right to monitor the production and distribution of goods and services.
    B. Private enterprises reserve the right to own property.
    C. Monopolies boost economic growth.
    D. Competition is discouraged because it hinders penetration into niche markets.
A

Private enterprises reserve the right to own property.

25
Q
  1. Unlike a market economy, a command economy is characterized by:
    A. private ownership of businesses.
    B. an appropriate response to consumers’ stated needs and desires.
    C. insufficient security provided by government subsidies.
    D. an ignorance of demographic information by management.
A

an ignorance of demographic information by management.

26
Q
  1. A _____ exists when private enterprise reserves the right to own property and monitor the production and distribution of goods and services while the state simply supports competition and efficient practices.
    A. command economy
    B. market economy
    C. mixed economy
    D. socialist economy
A

market economy

27
Q
  1. The challenge for the future of the European Union is to:
    A. have common custom duties.
    B. have unified industrial and commercial policies.
    C. be able to manufacture high-quality, low-cost goods.
    D. absorb its eastern neighbors.
A

absorb its eastern neighbors.

28
Q
  1. _____ is the United States’ largest trading partner, a position it has held for many years.
    A. England
    B. Canada
    C. Japan
    D. Mexico
A

Canada

29
Q
  1. After becoming part of the North American Free Trade Agreement (NAFTA) in 1994, Mexico:
    A. exhibited significant economic stability.
    B. was able to take advantage of the U.S. market.
    C. experienced a tremendous increase in transportation costs.
    D. experienced a significant increase in labor costs.
A

was able to take advantage of the U.S. market.

30
Q
  1. In the context of established economies, the United States has considerable foreign direct investment in _____.
    A. the Netherlands
    B. Mexico
    C. the United Kingdom
    D. Canada
A

Canada

31
Q
  1. Which of the following statements is true of the economic system of North America?
    A. The free-market-based economy of this region allows considerable freedom in decision-making processes of private firms.
    B. The command economy of this region allows for high flexibility with decisions and low barriers for other countries to establish business.
    C. The free-market-based economy of this region results in low trade barriers when attempting to move into other countries.
    D. The command economy of this region allows competition to strive while the government can extend assistance to individuals or companies.
A

The free-market-based economy of this region allows considerable freedom in decision-making processes of private firms.

32
Q
  1. By the early 1990s _____ had recovered from its economic problems of the previous decade and had become the strongest economy in Latin America.
    A. Brazil
    B. Argentina
    C. Mexico
    D. Chile
A

Mexico

33
Q
  1. U.S. firms maintain particularly dominant global positions in all of the following industries except:
    A. telecommunications.
    B. biotechnology.
    C. media.
    D. textiles.
A

textiles.

34
Q
  1. A factory, the majority of which are located in Mexican border towns, that imports materials and equipment on a duty- and tariff-free basis for assembly or manufacturing and re-export is referred to as _____.
    A. a vertically integrated corporation
    B. a keiretsu
    C. a maquiladora
    D. a governmental agency
A

a maquiladora

35
Q
  1. In the context of established economies, which of the following observations about NAFTA is incorrect?
    A. Mexican businesses are able to take advantage of the U.S. market by producing goods for that market that were previously purchased from Asia.
    B. Mexican firms are now able to produce products at highly competitive prices thanks to lower-cost labor and proximity to the American market.
    C. Mexican firms can now export goods into the European community only by paying a heavy tariff.
A

Mexican firms can now export goods into the European community only by paying a heavy tariff.

35
Q
  1. A major development in South America is:
    A. the implementation of a single currency and a regional central bank.
    B. the growth of intercountry trade, spurred on by the progress toward free-market policies.
A

the growth of intercountry trade, spurred on by the progress toward free-market policies.

36
Q
  1. A survey of businesspeople from Argentina, Brazil, Chile, Columbia, and Venezuela found that the _____ market, on average, was more important for their economic well-being than any other market.
    A. Mexican
    B. Japanese
    C. U.S.
A

U.S.

37
Q
  1. The ultimate objective of the European Union is to:
    A. develop separate custom duties for member countries.
    B. eliminate all trade barriers among member countries.
A

eliminate all trade barriers among member countries.

38
Q
  1. In the context of established economies, the European Union:
    A. has largely achieved the reality of a single currency and a regional central bank.
    B. has eliminated all trade barriers among member countries.
A

has largely achieved the reality of a single currency and a regional central bank.

39
Q

In the context of emerging and developing economies in Central and Eastern Europe, which of the following is a pervasive challenge in Russia?
A. Privatization
B. Dismantling of Russian price controls
C. Lack of public security
D. Expansion of the middle class

A

Lack of public security

40
Q

Russia, _____ receive the most media coverage and are among the largest of the former communist countries.
A. Romania, Poland, and Bulgaria
B. Czech Republic, Bulgaria, and Poland
C. Hungary, Romania, and Albania
D. Poland, Hungary, and the Czech Republic

A

Poland, Hungary, and the Czech Republic

41
Q
  1. Which of the following statements is true about the economy of Poland?
    A. The consensus decision-making system of Poland turns out to be too time-consuming in the new speed-based economy.
    B. During the 1970s and 1980s, Poland’s economic success had been without precedent.
    C. Poland is among the largest of the former communist countries that receive the least media coverage.
    D. Poland’s economy was the only economy in the European Union to grow during the global recession of 2008–2009.
A

Poland’s economy was the only economy in the European Union to grow during the global recession of 2008–2009.

42
Q

A _____ can be defined as an organizational arrangement in Japan in which a large, often vertically integrated group of companies cooperate and work closely with each other to provide goods and services to end users.
A. vertically integrated corporation
B. keiretsu
C. maquiladora

A

keiretsu

43
Q
  1. Ministry of International Trade and Industry (MITI) is a _____ government agency that identifies and ranks national commercial pursuits and guides the distribution of national resources to meet these goals.
    A. Chinese
    B. Japanese
    C. South Korean
A

Japanese

44
Q
  1. In the context of established economies, despite setbacks, _____ remains a formidable international competitor and is well poised in all three major economic regions: the Pacific Rim, North America, and Europe.
    A. Japan
    B. Chile
    C. China
A

Japan

45
Q
  1. In addition to Japan and China, the important economies in Asia are:
    A. South Korea, Hong Kong, Singapore, and Taiwan.
    B. Indonesia, South Korea, Japan, and Taiwan.
A

South Korea, Hong Kong, Singapore, and Taiwan.

46
Q
  1. In the context of emerging and developing economies, identify a true statement about China.
    A. Multinational corporations find it extremely easy to do business in and with China because of the undervaluation of the Chinese currency.
    B. China’s policy toward its foreign investors is rigid yet predictable.
    C. Trade relations between China and developed countries and regions have significantly improved after the revaluation of the Chinese currency.
    D. Foreign businesses need to maintain a delicate balance between the communist and the capitalist systems in China.
A

Foreign businesses need to maintain a delicate balance between the communist and the capitalist systems in China.

47
Q
  1. In _____, chaebols are very large, family-held conglomerates that have considerable political and economic power.
    A. Thailand
    B. Japan
    C. South Korea
A

South Korea

48
Q
  1. In the context of emerging and developing economies, identify a true statement about India.
    A. The overwhelmingly diverse people of India mostly speak tribal languages and dialects.
    B. Its political instability is pervasive, which generates substantial risks for foreign investors.
    C. Indians are known for their advanced information technology expertise.
A

Indians are known for their advanced information technology expertise.

49
Q
  1. Which of the following countries was not among the world’s 10 most competitive nations in 2015?
    A. Germany
    B. Singapore
    C. Mexico
    D. Norway
A

Mexico

International MGNT (14 decks)

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