WGU C211 Global Economics for Managers: Brian Final Complete
Review (Latest 2026/2027 Update) | Q&A | Grade A | 100% Correct
(Verified Answers) – WGU
Subject: Global Economics for Managers – Globalization Theories, FDI, Trade Theories, Market
Entry, Institutional Theory, Political & Legal Systems, Supply/Demand, Market Structures,
Monetary & Fiscal Policy, GDP, Consumer/Producer Surplus
Source: WGU C211 Brian Final Study Guide / Global Economics for Managers Blueprint
Format: Q&A Guide with Economic Rationale | 100% Verified
1: What are the three views on globalization?
Correct Answer: New, Evolutionary, and Pendulum
1. New view: globalization as a recent phenomenon (late 20th century).
2. Evolutionary view: globalization as a long-term historical process.
3. Pendulum view: globalization swings between extremes over time.
2: What is the "New" view on globalization?
Correct Answer: A force sweeping through the world in recent times.
1. Associated with post-1980s technological and economic changes.
2. Driven by digital revolution, reduced trade barriers, and MNE expansion.
3: Which view claims that the phenomenon of globalization was initially driven by the
desire of Western economies to exploit their power through multinational enterprises?
Correct Answer: "New" view (New-force view)
1. New-force view argues globalization is Western-driven exploitation.
2. Contrasts with evolutionary view (natural historical process).
4: What is the "Evolutionary" view on globalization?
Correct Answer: A long-run historical evolution since the dawn of human history
1. Trade has existed for millennia (Silk Road, ancient civilizations).
2. Modern era is continuation, not a break from past.
5: What is the "Pendulum" view on globalization?
Correct Answer: One that swings from one extreme to another from time to time.
1. Globalization ebbs and flows (e.g., pre-WWI open trade, interwar protectionism).
2. Most historically accurate dynamic view.
,6: What is Foreign Direct Investment (FDI)?
Correct Answer: Investments made by one company into another company that is located in another
country.
1. FDI implies control (typically >10% ownership).
2. Contrasts with portfolio investment (no control).
7: What are the three different political views on FDI?
Correct Answer: Radical view (hostile); Free market view (unrestricted best); Pragmatic nationalism
(weigh benefits/costs)
1. Radical: Marxist/anti-imperialist, favors nationalization.
2. Free market: based on comparative advantage and efficiency.
3. Pragmatic nationalism: most countries practice this case-by-case approach.
8: What are the benefits to a country receiving Foreign Direct Investment?
Correct Answer: Capital Inflow, Technology Spillover, Advanced Management Know-How, Job
creation
1. Capital inflow finances investment and infrastructure.
2. Technology transfer and managerial expertise improve productivity.
9: What costs exist in a country when they receive Foreign Direct Investment?
Correct Answer: 1. Loss of Sovereignty (power); 2. Adverse effects on competition; 3. Capital outflow
1. Loss of sovereignty: MNEs may influence local policies.
2. Competition effects: domestic firms may be crowded out.
3. Capital outflow: profits repatriated to home country.
10: How do resources and capabilities influence the competitive dynamics of a business?
Correct Answer: A firm's resources and capabilities must create value compared to its competition.
They need: Value, Rarity, Imitability, Organization.
1. VRIO framework: resources must be Valuable, Rare, Inimitable, and firm must be Organized.
2. Patents and proprietary technology are examples.
11: What are the classical theories of international trade?
Correct Answer: 1. Mercantilism; 2. Absolute advantage; 3. Comparative advantage
1. Static theories that do not account for change over time.
2. Developed before 20th century.
12: How does resource similarity impact competitive dynamics?
Correct Answer: Firms with a high degree of similarity are likely to make similar competitive
decisions.
1. Homogenous resource endowments lead to mutual awareness and rivalry.
2. Example: Starbucks and McDonald's both raise coffee prices after a shortage.
, 13: What are the modern trade theories of international trade?
Correct Answer: (1) Product life cycles; (2) Strategic trade; (3) National competitive advantage or
"Diamond"
1. Dynamic theories accounting for changes in trade patterns over time.
2. Developed in 20th century.
14: What is the classical theory view of international trade regarding change?
Correct Answer: Static, not changing
1. Assumes constant comparative advantage.
2. Does not account for technology, scale economies, or product evolution.
15: What is absolute advantage?
Correct Answer: The economic advantage one nation enjoys that is superior to other nations; the
ability to produce more output with the same inputs.
1. Adam Smith's theory: nations should specialize where they are most productive.
2. International trade is win-win, not zero-sum.
16: What is comparative advantage?
Correct Answer: The ability to produce a good or service at a lower opportunity cost than trading
partners.
1. David Ricardo's theory: trade benefits even if one country has absolute advantage in
everything.
2. Focus on opportunity cost, not absolute productivity.
17: What is mercantilism?
Correct Answer: A theory that suggests the wealth of the world (gold/silver) is fixed and a nation
that exports more and imports less will be richer.
1. First recorded theory of international trade.
2. Views trade as zero-sum; promotes protectionism and trade surplus.
18: What are the features of the product life cycle theory?
Correct Answer: New stage (production in US, exports); Maturing stage (production in other
developed nations); Standardized stage (production moves to low-cost developing nations)
1. Raymond Vernon's dynamic theory.
2. Comparative advantage changes as products mature.
19: What is strategic trade theory?
Correct Answer: Strategic intervention by governments in certain industries can enhance their odds
for international success (infant industry protection).
1. Government assistance helps firms build scale and compete globally.
2. Targets capital-intensive, high-barrier industries.
Review (Latest 2026/2027 Update) | Q&A | Grade A | 100% Correct
(Verified Answers) – WGU
Subject: Global Economics for Managers – Globalization Theories, FDI, Trade Theories, Market
Entry, Institutional Theory, Political & Legal Systems, Supply/Demand, Market Structures,
Monetary & Fiscal Policy, GDP, Consumer/Producer Surplus
Source: WGU C211 Brian Final Study Guide / Global Economics for Managers Blueprint
Format: Q&A Guide with Economic Rationale | 100% Verified
1: What are the three views on globalization?
Correct Answer: New, Evolutionary, and Pendulum
1. New view: globalization as a recent phenomenon (late 20th century).
2. Evolutionary view: globalization as a long-term historical process.
3. Pendulum view: globalization swings between extremes over time.
2: What is the "New" view on globalization?
Correct Answer: A force sweeping through the world in recent times.
1. Associated with post-1980s technological and economic changes.
2. Driven by digital revolution, reduced trade barriers, and MNE expansion.
3: Which view claims that the phenomenon of globalization was initially driven by the
desire of Western economies to exploit their power through multinational enterprises?
Correct Answer: "New" view (New-force view)
1. New-force view argues globalization is Western-driven exploitation.
2. Contrasts with evolutionary view (natural historical process).
4: What is the "Evolutionary" view on globalization?
Correct Answer: A long-run historical evolution since the dawn of human history
1. Trade has existed for millennia (Silk Road, ancient civilizations).
2. Modern era is continuation, not a break from past.
5: What is the "Pendulum" view on globalization?
Correct Answer: One that swings from one extreme to another from time to time.
1. Globalization ebbs and flows (e.g., pre-WWI open trade, interwar protectionism).
2. Most historically accurate dynamic view.
,6: What is Foreign Direct Investment (FDI)?
Correct Answer: Investments made by one company into another company that is located in another
country.
1. FDI implies control (typically >10% ownership).
2. Contrasts with portfolio investment (no control).
7: What are the three different political views on FDI?
Correct Answer: Radical view (hostile); Free market view (unrestricted best); Pragmatic nationalism
(weigh benefits/costs)
1. Radical: Marxist/anti-imperialist, favors nationalization.
2. Free market: based on comparative advantage and efficiency.
3. Pragmatic nationalism: most countries practice this case-by-case approach.
8: What are the benefits to a country receiving Foreign Direct Investment?
Correct Answer: Capital Inflow, Technology Spillover, Advanced Management Know-How, Job
creation
1. Capital inflow finances investment and infrastructure.
2. Technology transfer and managerial expertise improve productivity.
9: What costs exist in a country when they receive Foreign Direct Investment?
Correct Answer: 1. Loss of Sovereignty (power); 2. Adverse effects on competition; 3. Capital outflow
1. Loss of sovereignty: MNEs may influence local policies.
2. Competition effects: domestic firms may be crowded out.
3. Capital outflow: profits repatriated to home country.
10: How do resources and capabilities influence the competitive dynamics of a business?
Correct Answer: A firm's resources and capabilities must create value compared to its competition.
They need: Value, Rarity, Imitability, Organization.
1. VRIO framework: resources must be Valuable, Rare, Inimitable, and firm must be Organized.
2. Patents and proprietary technology are examples.
11: What are the classical theories of international trade?
Correct Answer: 1. Mercantilism; 2. Absolute advantage; 3. Comparative advantage
1. Static theories that do not account for change over time.
2. Developed before 20th century.
12: How does resource similarity impact competitive dynamics?
Correct Answer: Firms with a high degree of similarity are likely to make similar competitive
decisions.
1. Homogenous resource endowments lead to mutual awareness and rivalry.
2. Example: Starbucks and McDonald's both raise coffee prices after a shortage.
, 13: What are the modern trade theories of international trade?
Correct Answer: (1) Product life cycles; (2) Strategic trade; (3) National competitive advantage or
"Diamond"
1. Dynamic theories accounting for changes in trade patterns over time.
2. Developed in 20th century.
14: What is the classical theory view of international trade regarding change?
Correct Answer: Static, not changing
1. Assumes constant comparative advantage.
2. Does not account for technology, scale economies, or product evolution.
15: What is absolute advantage?
Correct Answer: The economic advantage one nation enjoys that is superior to other nations; the
ability to produce more output with the same inputs.
1. Adam Smith's theory: nations should specialize where they are most productive.
2. International trade is win-win, not zero-sum.
16: What is comparative advantage?
Correct Answer: The ability to produce a good or service at a lower opportunity cost than trading
partners.
1. David Ricardo's theory: trade benefits even if one country has absolute advantage in
everything.
2. Focus on opportunity cost, not absolute productivity.
17: What is mercantilism?
Correct Answer: A theory that suggests the wealth of the world (gold/silver) is fixed and a nation
that exports more and imports less will be richer.
1. First recorded theory of international trade.
2. Views trade as zero-sum; promotes protectionism and trade surplus.
18: What are the features of the product life cycle theory?
Correct Answer: New stage (production in US, exports); Maturing stage (production in other
developed nations); Standardized stage (production moves to low-cost developing nations)
1. Raymond Vernon's dynamic theory.
2. Comparative advantage changes as products mature.
19: What is strategic trade theory?
Correct Answer: Strategic intervention by governments in certain industries can enhance their odds
for international success (infant industry protection).
1. Government assistance helps firms build scale and compete globally.
2. Targets capital-intensive, high-barrier industries.
