{solved 2023/2024} WGU C211 Global Economics Final Exam Questions and Answers 100% Correct

ability-to-pay principle the idea that taxes should be levied on a person according to how well that person can shoulder the burden absolute advantage The economic advantage one nation enjoys that is absolutely superior to other nations. absorptive capacity The ability to recognize the value of new information, assimilate it, and apply it. accommodative strategy A strategy characterized by some support from top managers, who may increasingly view CSR as a worthwhile endeavor. accounting profit total revenue minus total explicit cost acquisition A transfer of the control of operations and management from one firm (target) to another (acquirer), the former becoming a unit of the latter. acquisition premium The difference between the acquisition price and the market value of target firms. adaptability The ability to change supply chain configurations in response to longer-term changes in the environment and technology. Administrative policies Bureaucratic rules that make it harder to import foreign goods. Adverse selection the tendency for the mix of unobserved attributes to become undesirable from the standpoint of an uninformed party agency costs The costs associated with principal-agent relationships. agency relationship The relationship between principals (such as shareholders) and agents (such as professional managers). Agency theory A theory that focuses on principal-agent relationships (or in short, agency relationships). Agent A person (such as manager) to whom authority is delegated. agglomeration Clustering of economic activities in certain locations. aggregate-supply curve a curve that shows the quantity of goods and services that firms choose to produce and sell at each price level Agility The ability to react quickly to unexpected shifts in supply and demand. Alignment Alignment of interests of various players. Andean Community A customs union in South America that was launched in 1969. antidumping duties Tariffs levied on imports that have been "dumped" (selling below costs to "unfairly" drive domestic firms out of business). Antidumping law Law that makes it illegal for an exporter to sell goods below cost abroad with the intent to raise prices after eliminating local rivals. antitrust law Law that outlaws cartels (trusts). antitrust policy Government policy designed to combat monopolies and cartels. APEC The official title for regional economic integration involving 21 member economies around the Pacific. appreciation an increase in the value of a currency as measured by the amount of foreign currency it can buy Arrow's impossibility theorem a mathematical result showing that, under certain assumed conditions, there is no scheme for aggregating individual preferences into a valid set of social preferences Asia-Pacific Economic Cooperation (APEC) The official title for regional economic integration involving 21 member economies around the Pacific. Association of Southeast Asian Nations (ASEAN) The organization underpinning regional economic integration in Southeast Asia. attack An initial set of actions to gain competitive advantage. Australia-New Zealand Closer Economic Relations Trade Agreement (ANZCERTA/CER) A free trade agreement between Australia and New Zealand that was launched in 1983. Automatic stabilizers changes in fiscal policy that stimulate aggregate demand when the economy goes into a recession without policymakers having to take any deliberate action Average fixed cost fixed cost divided by the quantity of output average revenue total revenue divided by the quantity sold average tax rate total taxes paid divided by total income average total cost total cost divided by the quantity of output average variable cost variable cost divided by the quantity of output balance of payments A country's international transaction statement, which includes merchandise trade, service trade, and capital movement. balance of trade The aggregation of importing and exporting that leads to the country-level trade surplus or deficit. balance sheet approach A compensation approach that balances the cost of living differences relative to parent country levels and adds a financial inducement to make the package attractive. balanced trade a situation in which exports equal imports bandwagon effect The effect of investors moving in the same direction at the same time, like a herd. bank capital the resources a bank's owners have put into the institution bargaining power Ability to extract favorable outcome from negotiations due to one party's strengths. base of the pyramid (BOP) Economies where people make less than $2,000 per capita per year. behavioral economics the subfield of economics that integrates the insights of psychology Beijing Consensus A view that questions Washington Consensus' belief in the superiority of private ownership over state ownership in economic policy making, which is often associated with the position held by the Chinese government. Benchmarking Examining whether a firm has resources and capabilities to perform a particular activity in a manner superior to competitors. benefits principle the idea that people should pay taxes based on the benefits they receive from government services bid rate The price to buy a currency. blue ocean strategy Strategy that focuses on developing new markets ("blue ocean") and avoids attacking core markets defended by rivals, which is likely to result in a bloody price war or a "red ocean." Bond Loan issued by the firm and held by creditors. Bondholders Buyer of bonds. Born global firm (international new venture) A start-up company that attempts to do business abroad from inception. born global firms A start-up company that attempts to do business abroad from inception. bounded rationality The necessity of making rational decisions in the absence of complete information.