Exam 2

Question 1

Did the practice of mercantilism encourage countries to import the goods they needed?

Answer 1

No

Question 2

According to Adam Smith, should a country’s imports/exports be determined by government policy?

Answer 2

No

Question 3

What produces a trade surplus?

Answer 3

A country exports more than it imports

Question 4

What is mercantilism?

Answer 4

An economic practice governments used to increase a country’s wealth and power through trade

Question 5

According to comparative advantage, is the potential world production greater with unrestricted free trade than with it?

Answer 5

Yes

Question 6

What does factor endowments refer to?

Answer 6

Availability of land and labor

Question 7

According to the product life cycle how does the locus of global production not change?

Answer 7

Developing nations to other advanced nations to the United States

Question 8

When does a zero-sum game occur?

Answer 8

When an economic gain by one country results in an economic loss by another

Question 9

What is absolute advantage?

Answer 9

The ability to produce a good or service more efficiently than a competitor, using the same amount of resources

Question 10

What is comparative advantage?

Answer 10

An economy’s ability to produce a particular good/service at a lower opportunity cost than its trading partners

Question 11

What is an advantage for a company to being a first mover?

Answer 11

Ability to capture scale economies ahead of later entrants

Question 12

What component of Porter’s diamond is most important in shaping the attributes of domestically made products and creating pressures for innovation and quality?

Answer 12

Demand conditions

Question 13

What other two elements did Porter believe can influence the national diamond?

Answer 13

Chance and government

Question 14

What are the four aspects of Porter’s diamond?

Answer 14

Factor endowments, demand conditions, firm strategy and structure, and rivalry, related and supporting industries

Question 15

Would Michael Porter agree that skilled labor is an advanced factor of production?

Answer 15

Yes

Question 16

Where are the many ethical issues in international business rooted from?

Answer 16

Political systems, law, economic development, and culture varying significantly from country to country

Question 17

When is the tragedy of the commons in evidence?

Answer 17

When a resource that is held by everyone, but not owned by anyone is depleted to the point of degradation

Question 18

Does Milton Friedman agree that a business should undertake social expenditures even if it reduces profits?

Answer 18

No

Question 19

State one criticism of the righteous moralist approach?

Answer 19

Adopting home-country standards is not always appropriate

Question 20

What is the phrase, “when in Rome, do as the romans do” associated with?

Answer 20

Cultural relativism

Question 21

What does Kantian ethics state?

Answer 21

People should be treated as ends and never purely as means to the ends of others

Question 22

What does the difference principle indicate?

Answer 22

Inequalities are justified if they benefit the position of the least advantaged members of society

Question 23

As countries get richer, does a shift away from traditional values tend to occur?

Answer 23

Yes

Question 24

Do rituals and symbols constitute the outward expression of deeper values?

Answer 24

Yes

Question 25

Is the least rigid system of social stratification a caste system?

Answer 25

No

Question 26

What does the Islamic banking method of mudarabah state?

Answer 26

When money is lent they don't charge that business interest, but instead take a share of the profits that are derived from the investment

Question 27

Will a country characterised by low uncertainty avoidance be less resistant to change?

Answer 27

Yes

Question 28

Does someone believing that their culture is superior result in conflicts with their colleagues from different countries?

Answer 28

Yes

Question 29

What is someone's disposition?

Answer 29

Their mood or general attitude about life

Question 30

Define guanxi

Answer 30

The practice of using personal relationships to gain favours or services

Question 31

What is the most widely spoken language in the world, and serves as the language of international business?

Answer 31

English

Question 32

What is the utilitarian approach to ethics based on?

Answer 32

The moral worth of actions is determined by their ultimate consequences

Question 33

What is a grease payment (speed money)?

Answer 33

A payment to government employees to speed up an administrative process whose outcome is already determined

Question 34

Are righteous moralists most likely to claim that a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries?

Answer 34

Yes

Question 35

Does culture refer to the inherited attitudinal traits of an individual?

Answer 35

Yes

Question 36

Does the veil of ignorance support impartiality in justice?

Answer 36

Yes

Question 37

In collective societies is competition for resources the norm?

Answer 37

No

Question 38

Are firms with high power distance more likely to be characterised by concentrated power among executives and little autonomy for subordinates?

Answer 38

Yes