IBUS6001 Multiple Choice Questions_Question Bank

IBUS6001 Multiple Choice Questions_Question Bank Multiple Choice Questions This document provides a list of MC questions to give students an idea how these types of questions will look like in the final exam. The final exam questions will be drawn from this list. Please note, the topics of the lecture change from semester to semester, so you will find questions in this list that related to topics we did not discuss this semester and that are accordingly not relevant for this semester. Please also note that we will not provide answers to these questions, neither here nor individually nor by email, these questions are just provided as examples. 1. Which of the following is not characteristic of globalization? A. National economies are turning into independent economic systems B. Material culture is starting to look similar the world over C. Perceived distance is shrinking due to advances in transportation and telecommunications D. Barriers to cross-border trade and investment are declining 2. Globalization has the opportunities for a firm to expand its revenues by selling around the world and its costs by producing in nations where key inputs are cheap. A. Reduced, reduced B. Increased, increased C. Increased, reduced D. Reduced, increased 3. Identify the incorrect statement concerning globalization. A. It has been blamed for unemployment in developed nations, environmental degradation and the Americanization of popular culture B. It has created new threats for businesses accustomed to dominating their domestic markets C. It is transforming industries and is highly welcomed by those who believed their jobs were protected from foreign competition D. According to most economists it is a very beneficial process where gains outweigh the losses by a wide margin 4. In the U.S., percent of firms that export are small companies employing fewer than 100 people. A. 90 B. 75 C. 50 D. 30 5. The most global markets currently are markets for A. Services B. Consumer goods C. Consumer durables D. Industrial goods 6. Which of the following is not an impediment that makes it difficult for firms to achieve the optimal dispersion of their productive activities to locations around the globe? A. Reduced transportation costs B. Government regulations C. Issues associated with economic and political risk D. Barriers to foreign direct investment 7. The is primarily responsible for policing the world trading system and making sure nation-states adhere to the rules laid down in trade treaties signed by member states. A. International Development Association B. World Bank C. International court of justice D. World Trade Organization 8. The was created in 1944 by 44 nations that met in Breton Woods, New Hampshire to promote economic development. A. World Bank B. World Monetary Fund C. World Trade Organization D. United Nations 9. The institution, created in 1944 at Bretton Woods, responsible for maintaining order in the international monetary system is the A. IMF B. WTO C. UN D. UNESCO 10. occur(s) when a firm exports goods or services to consumers in another country. A. International trade B. Foreign direct investment C. Inward investment D. Merger and acquisitions 11. The was established to remove barriers to the free flow of goods, services and capital between nations. A. UN B. IMF C. GATT D. IDA 12. GATT's Uruguay Round of negotiations resulted in all of the following except that it A. Further reduced trade barriers B. Extended GATT to cover services as well as manufactured goods C. Provided enhanced protection for patents, trademarks and copyrights D. Established the International Monetary Fund 13. Under the Uruguay Round of GATT, A. Regulations to make it harder for foreign companies to enter markets were mandated B. The World Trade Organization was established C. The volume of world trade decreased D. Barriers to trade in manufactured goods were incorporated 14. At the Doha Round of the WTO in late 2001 A. The WTO was established B. GATT was extended to include services C. World trade volume increased D. An agenda was established to phase out subsidies to agricultural producers 15. The reduction in the average tariff rates on manufactured products since 1950 implies all of the following except that A. Firms are dispersing parts of their production process to global locations to drive down production costs and increase product quality B. The economies of the world's nation states are becoming more intertwined C. Nations are becoming increasingly independent of each other for important goods and services D. The world has become significantly wealthier since 1950 16. Identify the incorrect statement concerning the average yearly outflow of FDI. A. It was about $0 trillion in 1975 B. It increased to $2 trillion in 2000 C. It decreased in the early 2000s D. It was about $2 trillion in 2006 17. Which of the following statement regarding cross-border trade and investment is not true? A. "Protection" from foreign competitors has been, at times, demanded by the United States B. Forecasts indicate a return to the restrictive trade policies of the 1920s and 30s C. If trade barriers decline no further they will put a brake upon the globalization of both markets and production D. It is not clear whether the political majority in the industrialized world favors further reductions in trade barriers 18. The growing integration of the world economy is A. Increasing the intensity of competition in a wide range of manufacturing and service industries B. Decreasing the intensity of competition in manufacturing industries and increasing the intensity of competition in services C. Increasing the intensity of competition in manufacturing industries and decreasing the intensity of competition in services D. Narrowing the scope of competition in a wide range of service, commodity and manufacturing industries 19. Identify the incorrect statement pertaining to the World Wide Web A. It makes it much easier for buyers and sellers to find each other B. Viewed globally, it is emerging as an equalizer C. It rolls back all of the constraints of location, scale and time zones D. It allows businesses to expand their global presence at a lower cost than ever before 20. Since 1980, the world's containership fleet has more than , reflecting in part the growing volume of international trade A. Doubled B. Tripled C. Quadrupled D. Quintupled 21. Technological innovations have facilitated all of the following except A. Globalization of production B. Globalization of markets C. Creation of electronic global marketplaces D. Creation of absolutely homogeneous consumer markets 22. Although the characteristics of the global economy have changed dramatically over the past 30 years, as late as the 1960s all of the following demographic characteristics were true, except: A. The U.S. dominated the world economy B. Small, U.S. entrepreneurial firms dominated the international business scene C. The U.S. dominated the world foreign direct investment picture D. Roughly half the world was governed by centrally planned economies of the Communist world 23. Which of the following observations is not true? A. During the 1960s, the U.S. routinely accounted for 20 percent of world exports of manufactured goods B. The U.S. share of world exports of goods and services had slipped to 8 percent by 2006 C. In 2006, United States was the world's largest exporter of goods and services D. The growing economic development and industrialization of the world economy has led to an absolute decline in the health of the U.S. economy 24. Which of the following statements pertaining to the changing demographics of world GDP and trade from 1963 to 2006 is not true? A. As emerging economies continue to grow, a relative decline in the share of world output and world exports accounted for by the U.S. seems unlikely B. Forecasts predict a rapid rise in the share of world output accounted for by some developing nations C. A decline in the share enjoyed by rich industrialized countries such as Great Britain, Germany, Japan and the U.S. is likely D. If current trends continue, the Chinese economy could be larger than that of the U.S. on a purchasing power parity basis 25. Which of the following nation's world output has declined the least over the last 40 years? A. France B. United States C. United Kingdom D. Canada 26. As of 2006, which of the following countries had the largest share of world exports? A. Germany B. Japan C. United States D. China 27. Which of the following countries has had the maximum relative decline in its share of world output since 1963? A. Canada B. United States C. Japan D. Germany 28. Most forecasts now predict A. A rapid decline in the share of world output accounted for by developing nations such as China, India and others B. That if current trends continue, the economy of India will approach that of Germany C. That today's rich nations may account for more than 60 percent of world economic activity by 2020 D. That today's developing nations may account for only about 38 percent of world economic activity by 2020 29. According to World Bank numbers A. Developing nations currently account for more than 60 percent of world economic activity B. Rich nations currently account for more than 70 percent of world economic activity C. Today's rich nations may account for 55 percent of world economic activity by 2020 D. Today's developing nations may account for more than 60 percent of world economic activity by 2020 30. In the 1970s, many Japanese firms invested in North America and Europe A. To avoid a highly competitive domestic market B. To circumvent high domestic tariff barriers C. As a hedge against unfavorable currency movements D. To take advantage of low labor costs 31. What is the total cumulative value of foreign investments best referred to as? A. Accumulation of foreign shares B. Portfolio investments C. Stock of foreign direct investments D. Stock market investments 32. The share of the total FDI stock accounted for by firms declined to about half from 1980 to A. American B. Japanese C. German D. French 33. The share of the total FDI stock accounted for by which of the following countries increased markedly from 1980 to 2005? A. United States B. France C. United Kingdom D. Netherlands 34. Firms based in accounted for 9 percent of the stock of foreign direct investment in 2005, up from only 1 percent in A. North America B. Developing countries C. United Kingdom D. Netherlands 35. Which of these statements pertaining to cross-border FDI flows is true? A. The growth of FDI resumed in 2004 and continued through 2006 B. A surge in FDI from 1995 to 1997 was followed by a slump from 1998 to 2000 C. Among developing nations, the largest recipient of FDI has been Russia D. The dramatic increase in FDI reflects the decreasing internationalization of business corporations 36. Which of the following countries has been the largest recipient of foreign direct investment and received about $70 billion a year in inflows in 2005 and 2006? A. Brazil B. Russia C. India D. China 37. By 2005 some 27 of the world's 100 largest non-financial multinationals were A. Chinese enterprises B. British enterprises C. U.S. enterprises D. Japanese enterprises 38. According to UN data, the ranks of the world's largest 100 multinationals are dominated by firms from A. Developed economies B. Firms from China C. Firms from Europe D. Developing countries 39. Identify the incorrect statement regarding the former Communist nations of Europe and Asia. A. The economies of most of the former Communist states are very strong and developed B. Many of the former Communist nations of Europe and Asia share a commitment to free market economies C. As a result of disturbing signs of growing unrest and totalitarian tendencies, the risks involved in doing business in these countries is very high D. For about half a century these countries were essentially closed to Western international business 40. Which of the following observations concerning Latin American countries is true? A. Complete restrictions on direct investment by foreign firms B. Characterized by low growth, high debt and hyperinflation C. Debt and inflation are up compared to previous decades D. Substantial opportunities exist, but are accompanied by substantial risks 41. Which of the following statement pertaining to changes in the global economy of the 21st century is not true? A. Barriers to the free flow of goods, services and capital have been coming down B. Volume of cross-border trade and investment has been growing more rapidly than global output C. National economies are becoming more independent and moving away from the global economic system D. As economies advance, more nations are joining the ranks of the developed world 42. Which of the following does not help create an economic system that is favorable to international business? A. Decreased privatization B. Widespread deregulation C. Open markets D. Falling trade and investment barriers 43. In December 1999 anti-globalization protesters in Seattle targeted the _, which was meeting to try to discuss cutting barriers to cross-border trade and investment and was seen as a promoter of globalization. A. GATT B. WTO C. World Bank D. IMF 44. When a company "exports jobs" overseas, the company is A. Helping domestic workers by pushing up wage rates B. Increasing the demand of qualified domestic workers C. Taking advantage of lower wages in foreign markets D. Deceiving the supporters of globalization 45. If the critics of globalization are correct, all of the following things must be shown except A. The share of national income received by labor, as opposed to the share received by the owners of capital should have declined in advanced nations B. Even though labor's share of the economic pie may have declined, living standards need not deteriorate if the size of the total pie has increased sufficiently to offset the decline