test 1 review part 6

Question 1

A nation’s wealth depends on accumulated treasure and to increase wealth governments should promote exports and discourage imports.

Answer 1

mercantilism

Question 2

Investing in, controlling, and managing value-added activities in other countries.

Answer 2

FDI

Question 3

Governments nationalize private firms in order to
A. extract money from the firms when the firms are suspected of concealing profits.
B. decrease exports to balance the balance of payments.
C. learn about business development experientially.
D. punish workers at the firms for their political activism.

Answer 3

A. extract money from the firms when the firms are suspected of concealing profits.

Question 4

Dumping includes

A. the foreign exporter’s selling better products into the market than those manufactured in the home country.
B. black market sales to avoid prohibited substances, such as weapons, alcohol, and pornography.
C. selling goods priced lower in a foreign market than in the home market to build market share.
D. expanding fast-food franchise operations in foreign markets.

Answer 4

C. selling goods priced lower in a foreign market than in the home market to build market share.

Question 5

Social dumping occurs when an exporting country
A. imposes an export tax on domestic businesses that export, to compensate for the opportunity cost to the domestic market.
B. creates unfair competition based on lower costs because the exporting country provides little social support system to the worker.
C. targets markets that consist of specific vulnerable groups in the importing country.
D. exports good that are not sellable in the domestic environment due to hazards and safety
issues.

Answer 5

B. creates unfair competition based on lower costs because the exporting country provides little social support system to the worker.

Question 6

When governments nationalize a firm, they don’t seek to
A. extract more money from the firm.
B. increase the firm’s profitability.
C. preserve jobs.
D. sell the firm to foreign investors.

Answer 6

D. sell the firm to foreign investors.

Question 7

the extent to which less powerful members within a culture expect and accept that power is distributed unequally

Answer 7

power distance