PUZC (Pre Assessment) questions with complete solution study guide

PUZC (Pre Assessment) Which view claims that the phenomenon of globalization was initially driven by the desire of Western economies to exploit their power through multinational enterprises? Ans: A. The new-force view* B. The long-run historical view C. The balanced surplus-deficit view D. The pendulum view Economic gains come from international trade because one country's exported goods, services, or other items are unique, valuable, and difficult to duplicate to the importing country. Which view does this statement portray? Ans: A. Institution-based view B. Country-based view C. City-based view D. Resource-based view* What is the aggregation of importing and exporting that leads to the country-level trade surplus or deficit? Ans: A. Profit B. Revenue C. Balance of Trade* D. Loss What is a cost of foreign direct investment? Ans: A. Developing countries may be exploited by multinational enterprises (MNE)* B. Human rights firms may help labor force in host countries with multinational enterprise (MNE) influence C. Host countries welcome political interference by multinational enterprises (MNE) when things are not in favor of the foreign company D. Local government in host countries may promote corporate social responsibilities on behalf of multinational enterprises (MNEs) Which type of managerial capability is both challenging and difficult to imitate? Ans: A. Duplicative capability B. Intangible capability* C. Factual capability D. Dualistic Capability What may precious, rare, and hard-to-duplicate resources and capabilities lead to for a firm? Ans: A. Sustained competitive disadvantage B. Sustained comparative advantage* C. Sustained influence D. Sustained leverage Which theory of international trade states that poor countries often experience faster rates of economic growth compared to wealthy countries? Ans: A. The catch-up effect* B. The sustainability effect C. The income effect D. The ratchet effect What is the financial environment in which exchange rates and payments for goods and services are conducted. Ans: A. Stock exchange B. Intercontinental exchange C. International monetary system D. Commodity exchange* What happens to a country's real exchange rate and nominal interest rate as the price level increases, assuming all other factors are unchanged? Ans: A. Exchange rate appreciate, interest rates decrease B. Exchange rates depreciate, interest rates increase* C. Exchange rates appreciate, interest rates increase D. Exchange rates depreciate, interest rates decrease What is the easiest method non-financial companies use to handle currency fluctuations? Ans: A. Foreign direct investment B. Commodity trading* C. Export sales D. Currency diversification Which strategy minimizes the risk of unanticipated changes in future exchange rates? Ans: A. Sensitivity analysis B. Currency swap* C. Speculation D. Spot transaction A company is looking for a location with an abundance of ground-breaking individuals, firms, and universities. Which type of strategic goal is this company demonstrating? Ans: A. Efficiency-seeking B. Natural-resource seeking C. Innovation-seeking* D. Market-seeking What advantage comes with not sharing benefits with late entrants? Ans: A. Early-mover advantage B. Laggard advantage C. First-mover advantage* D. Late-mover advantage Which entry mode is a non-equity arrangement for a company contemplating entry into a foreign market? Ans: A. Green-fields B. Acquisitions C. Licensing* D. Joint-venture What size commitment is required for a non-equity mode of entry into a foreign market? Ans: A. Standard commitment B. Larger commitment C. No commitment D. Small commitment* What are two supportive pillars for an informal institution? Ans: A. Normative* B. Protection C. Regulatory D. Cognitive* E. Coercive What is the key role of an institution, according to the institution-based view? Ans: A. To develop a new business culture B. To reduce uncertainty* C. To identify problems D. To challenge laws What are the rules, enforcement mechanisms, and organizations that support market transactions? Ans: A. Businesses B. Companies C. Industries D. Institutions* What is a core proposition underpinning an institutional-based view of global business? Ans: A. Substantive rationality B. Bounded rationality* C. Formal rationality D. Theoretical rationality In which type of political system do citizens elect representatives to govern the country on their behalf? Ans: A. Democracy* B. Communism C. Monarchy D. Totalitarianism Which legal system uses comprehensive lists of rules and written codes? Ans: A. Property law B. Tort law C. Common law D. Civil law* What are the legal privileges associated with the use of economic property to obtain income and other benefits from its use? Ans: A. Property propaganda B. Property rights* C. Universal property D. Property gains What is the purpose of having property rights and intellectual property rights? Ans: A. To legally protect past owners of the property from its future owners after the sale of it B. To legally protect the use to tangible and intangible property and allow its lawful owner to derive income and other benefits from it* C. To legally protect the future and past users of the property and allow its future owners all future benefits D. To legally protect the future of property so that one county can derive income from it and the past users cannot What are the two popular types of economies? Ans: A. Mixed economies* B. Market economies* C. Centrally planned economies D. Open economies In addition to encouraging efficiency, why might a government intervene in a market? Ans: A. To promote equality B. To prop up self-interest C. To increase profits* D. To ensure changes What is the relationship between total and marginal cost? Ans: A. Marginal cost is the change in total cost divided by the change in quantity* B. Marginal cost is total cost divided by quantity C. Marginal cost is price multiplied by total cost D. Marginal cost is quantity multiplied by total cost A farmer sells wheat in a perfectly competitive market. Which action should the farmer take to maximize profits? Ans: A. Produce the quantity that minimizes average variable cost B. Produce at a price were marginal cost equals the average total cost C. Produce the quantity at the average fixed cost D. Produce the quantity where the price equals the farmer's marginal cost* What is the economic profit of a competitive firm? Ans: A. The difference between average fixed cost and price B. The different between marginal revenue and marginal cost C. The difference between total revenue and price D. The difference between total revenue and total cost* Which condition applies when a competitive firm decides to temporarily shut down? Ans: A. Average variable costs are above the price