C211 WGU (2025) Actual Exam
Questions and Answers A+ Graded
Globalization .- .CORRECT .ANSWER .-Is .the .close .integration .of .countries .and
.peoples .of .the .world .which .has .been .brought .about .by .the .enormous .reduction
.of .the .cost .of .transportation .and .communication, .and .the .breaking .down .of
.artificial .barriers .to .the .flows .of .goods, .services, .capital, .knowledge, .and .(to .a
.lesser .extent) .people .across .borders.
New .view .of .Globalization .- .CORRECT .ANSWER .-A .new .force .sweeping
.through .the .world .in .recent .times .that .it .is .a .new .phenomenon .beginning .in
.the .late .20th .century, .driven .by .recent .technological .innovations .and .a .Western
.ideology .focused .on .exploiting .and .dominating .the .world .through .a
.Multinational .enterprises.
Evolutionary .view .of .globalization .- .CORRECT .ANSWER .-A .long .run .historical
.evolution .since .the .down .of .human .history. .Historians .are .debating .whether
.globalization .started .2,000 .or .8,000 .years .ago. .Earliest .traces .of .globalization
.goes .back .to .the .Assyrian, .Phoenician, .and .Roman .times.
Pendulum .view .of .globalization .- .CORRECT .ANSWER .-A .pendulum .that .swings
.from .one .extreme .to .another .from .time .to .time. .Globalization .is .neither .recent
.or .one-directional. .Risk .management .and .scenario .planning .is .needed.
What .is .Foreign .Direct .Investment .(FDI)? .- .CORRECT .ANSWER .-Investment .in,
.controlling .and .managing .value-added .activities .in .other .countries. .In .other
.words, .investment .made .by .a .firm .or .individual .in .one .country .into .business
.interest .located .in .another .country. .Most .discussed .foreign .entrance .is .MNE.
MNE: .Multinational .Enterprise .- .CORRECT .ANSWER .-Is .a .firm .that .engages .in
.FDI .when .doing .business .abroad. .FDI .sets .apart .MNEs .and .non-MNEs.
What .different .political .views .exists .on .FDI? .- .CORRECT .ANSWER .--in
.developed .economies, .backlash .against .inbound .FDI .from .certain .countries .is
.not .unusual. .Example, .in .the .1980s, .Americans .were .alarmed .by .the .significant
.Japanese .inroads .into .the .United .States. .
-in .some .parts .of .the .developing .world, .tension .over .foreign .ownership .can
.heat .up. .There .were .numerous .incidents .of .nationalization .and .expropriation
.against .MNE .assets .throughout .the .developing .world.
What .4 .benefits .exist .to .a .country .receiving .FDI? .- .CORRECT .ANSWER .-1.
.Capital .inflow .improve .the .host .country .balance .of .payment. .More .technology,
.management, .and .more .jobs .in .their .countries. .
,2. .Technology, .especially .more .advanced .technology .from .abroad, .can .create
.technology .spillovers .that .benefits .domestic .firms .and .industries. .Local .rivals
.can .learn .and .imitate .such .technology .resulting .in .what's .called .demonstration
.effect .(contagion .effect).
3. .Advanced .management .know .how .may .be .highly .valued. .It's .often .difficult
.for .indigenous .development .of .management .to .know .how .to .reach .a .world-
class .level .in .absence .of .FDI.
4. .FDI .creates .jobs, .both .directly .and .indirectly. .Direct .benefits .arise .when
.MNEs .employ .individuals .locally.
What .costs .exist .to .a .country .receiving .FDI? .- .CORRECT .ANSWER .-1. .Loss .of
.sovereignty
2. .Adverse .effects .on .competition
3. .capital .outlfow
How .do .resources .and .capabilities .influence .the .competitive .dynamics .of .a
.business? .- .CORRECT .ANSWER .-Firm .resources .must .create .value .when
.engaging .rivals. .The .ability .to .respond .rapidly .to .challenges .also .adds .value.
Competitive .Dynamics .- .CORRECT .ANSWER .-Actions .and .responses
.undertaken .by .competing .firms.
What .is .resource .similarity? .- .CORRECT .ANSWER .-Extent .to .which .a .given
.competitor .possesses .strategic .endowment .comparable .in .terms .of .both .type
.and .amount .to .those .of .the .local .firm. .In .order .words, .extent .to .which .firm's
.tangible/intangible .resources .are .comparable .to .competitors .in .type .and
.amount.
How .does .resource .similarity .impact .competitive .dynamics? .- .CORRECT
.ANSWER .-Firms .with .a .high .degree .of .resources .similarity .are .likely .to .have
.similar .competitive .actions. .For .example, .Apple .and .IBM .used .to .have .a .lot .of
.resource .similarity .in .the .1990s .that .they .fought .a .lot.
Classical .theory .of .international .trade. .- .CORRECT .ANSWER .-1. .Mercantilism
2. .Absolute .advantage
3. .Comparative .advantage
Mercantilism .- .CORRECT .ANSWER .-Theory .that .suggests .that .the .wealth .of .the
.world .is .fixed .and .that .a .nation .that .exports .more .and .imports .less .will .be
.richer. .On .the .other .hand, .a .nation .experiencing .a .trade .deficit .would .see .its
.gold .and .silver .flowing .out .and, .consequently, .would .become .poorer.
.International .trade .is .a .zero-sum .game.
Absolute .advantage .- .CORRECT .ANSWER .-Theory .that .suggests .that .under .free
.trade, .a .nation .gains .by .specializing .in .economic .activities .in .which .it .has .an
.absolute .advantage .with .free .trade .market .forces .are .determined .with .little .to
.no .government .intervention. .The .economic .advantage .one .nation .enjoys .that .is
.absolutely .superior .to .other .nations. .International .trade .is .a .win-win .game.
.There .are .net .gains .from .trade.
, Comparative .advantage .- .CORRECT .ANSWER .-Theory .that .focuses .on .the
.relative .(not .absolute) .advantage .in .one .economic .activity .that .one .nation
.enjoys .in .comparison .with .other .nations. .It .suggests .that .the .U.S. .has .an
.absolute .advantage .over .China .in .both .wheat .and .aircraft, .but .as .longs .as
.China .is .not .equally .less .efficient .in .production .of .both .goods, .China .can .still
.choose .to .specialize .in .the .production .of .one .good. .There .are .net .gains .from
.trade. .
-opportunity .cost .is .a .crucial .concept .here.
Opportunity .cost .- .CORRECT .ANSWER .-The .cost .of .pursuing .one .activity .at .the
.expense .of .another .activity.
Factor .endowments .- .CORRECT .ANSWER .-The .extent .to .which .different
.countries .possess .various .factors .of .production .such .as .labor, .land, .and
.technology.
Modern .Theory .- .CORRECT .ANSWER .-1. .Product .life .cycle. .
2. .Strategic .trade. .
3. .National .competitive .advantage
Product .life .cycle .- .CORRECT .ANSWER .-A .theory .that .accounts .for .changes .in
.the .patterns .of .trade .over .time .by .focusing .on .product .life .cycle. .
1. .New: .production .of .a .new .product .that .commands .a .price .premium .will
.concentrate .in .the .United .States .which .exports .to .other .developed .nations.
2. .Maturing .stage: .demand .and .ability .to .produce .grow .in .other .developed
.nations .so .it .is .now .worthwhile .to .produce .there. .
3. .Standardized .(commoditized): .production .moves .to .low-cost .developing
.nations, .which .export .to .developed .nations. .Comparative .advantage .may
.change .over .time.
Strategic .trade .theory .- .CORRECT .ANSWER .-Suggests .that .strategic
.intervention .by .governments .in .certain .industries .can .enhance .their .odds .for
.international .success. .These .industries .tend .to .be .high .capital-intensive, .high-
entry-barrier .industries .in .which .firms .may .have .little .chance .without
.government .assistance. .These .industries .feature .first-mover .advantages.
Strategic .trade .policy .- .CORRECT .ANSWER .-Government .policy .that .provides
.companies .a .strategic .advantage .in .international .trade .through .subsidies .and
.other .supports.
First .mover .advantages .- .CORRECT .ANSWER .-Advantages .that .first .entrants
.enjoy .and .do .not .share .with .late .entrants.
National .competitive .advantage .- .CORRECT .ANSWER .-Theory .that .suggest .that
.the .competitive .advantage .of .certain .industries .in .different .nations .depends .on
.four .aspects .that .form .a ."diamond." .Theory .focuses .on .why .certain .industries
.within .a .nation .are .competitive .internationally.
Questions and Answers A+ Graded
Globalization .- .CORRECT .ANSWER .-Is .the .close .integration .of .countries .and
.peoples .of .the .world .which .has .been .brought .about .by .the .enormous .reduction
.of .the .cost .of .transportation .and .communication, .and .the .breaking .down .of
.artificial .barriers .to .the .flows .of .goods, .services, .capital, .knowledge, .and .(to .a
.lesser .extent) .people .across .borders.
New .view .of .Globalization .- .CORRECT .ANSWER .-A .new .force .sweeping
.through .the .world .in .recent .times .that .it .is .a .new .phenomenon .beginning .in
.the .late .20th .century, .driven .by .recent .technological .innovations .and .a .Western
.ideology .focused .on .exploiting .and .dominating .the .world .through .a
.Multinational .enterprises.
Evolutionary .view .of .globalization .- .CORRECT .ANSWER .-A .long .run .historical
.evolution .since .the .down .of .human .history. .Historians .are .debating .whether
.globalization .started .2,000 .or .8,000 .years .ago. .Earliest .traces .of .globalization
.goes .back .to .the .Assyrian, .Phoenician, .and .Roman .times.
Pendulum .view .of .globalization .- .CORRECT .ANSWER .-A .pendulum .that .swings
.from .one .extreme .to .another .from .time .to .time. .Globalization .is .neither .recent
.or .one-directional. .Risk .management .and .scenario .planning .is .needed.
What .is .Foreign .Direct .Investment .(FDI)? .- .CORRECT .ANSWER .-Investment .in,
.controlling .and .managing .value-added .activities .in .other .countries. .In .other
.words, .investment .made .by .a .firm .or .individual .in .one .country .into .business
.interest .located .in .another .country. .Most .discussed .foreign .entrance .is .MNE.
MNE: .Multinational .Enterprise .- .CORRECT .ANSWER .-Is .a .firm .that .engages .in
.FDI .when .doing .business .abroad. .FDI .sets .apart .MNEs .and .non-MNEs.
What .different .political .views .exists .on .FDI? .- .CORRECT .ANSWER .--in
.developed .economies, .backlash .against .inbound .FDI .from .certain .countries .is
.not .unusual. .Example, .in .the .1980s, .Americans .were .alarmed .by .the .significant
.Japanese .inroads .into .the .United .States. .
-in .some .parts .of .the .developing .world, .tension .over .foreign .ownership .can
.heat .up. .There .were .numerous .incidents .of .nationalization .and .expropriation
.against .MNE .assets .throughout .the .developing .world.
What .4 .benefits .exist .to .a .country .receiving .FDI? .- .CORRECT .ANSWER .-1.
.Capital .inflow .improve .the .host .country .balance .of .payment. .More .technology,
.management, .and .more .jobs .in .their .countries. .
,2. .Technology, .especially .more .advanced .technology .from .abroad, .can .create
.technology .spillovers .that .benefits .domestic .firms .and .industries. .Local .rivals
.can .learn .and .imitate .such .technology .resulting .in .what's .called .demonstration
.effect .(contagion .effect).
3. .Advanced .management .know .how .may .be .highly .valued. .It's .often .difficult
.for .indigenous .development .of .management .to .know .how .to .reach .a .world-
class .level .in .absence .of .FDI.
4. .FDI .creates .jobs, .both .directly .and .indirectly. .Direct .benefits .arise .when
.MNEs .employ .individuals .locally.
What .costs .exist .to .a .country .receiving .FDI? .- .CORRECT .ANSWER .-1. .Loss .of
.sovereignty
2. .Adverse .effects .on .competition
3. .capital .outlfow
How .do .resources .and .capabilities .influence .the .competitive .dynamics .of .a
.business? .- .CORRECT .ANSWER .-Firm .resources .must .create .value .when
.engaging .rivals. .The .ability .to .respond .rapidly .to .challenges .also .adds .value.
Competitive .Dynamics .- .CORRECT .ANSWER .-Actions .and .responses
.undertaken .by .competing .firms.
What .is .resource .similarity? .- .CORRECT .ANSWER .-Extent .to .which .a .given
.competitor .possesses .strategic .endowment .comparable .in .terms .of .both .type
.and .amount .to .those .of .the .local .firm. .In .order .words, .extent .to .which .firm's
.tangible/intangible .resources .are .comparable .to .competitors .in .type .and
.amount.
How .does .resource .similarity .impact .competitive .dynamics? .- .CORRECT
.ANSWER .-Firms .with .a .high .degree .of .resources .similarity .are .likely .to .have
.similar .competitive .actions. .For .example, .Apple .and .IBM .used .to .have .a .lot .of
.resource .similarity .in .the .1990s .that .they .fought .a .lot.
Classical .theory .of .international .trade. .- .CORRECT .ANSWER .-1. .Mercantilism
2. .Absolute .advantage
3. .Comparative .advantage
Mercantilism .- .CORRECT .ANSWER .-Theory .that .suggests .that .the .wealth .of .the
.world .is .fixed .and .that .a .nation .that .exports .more .and .imports .less .will .be
.richer. .On .the .other .hand, .a .nation .experiencing .a .trade .deficit .would .see .its
.gold .and .silver .flowing .out .and, .consequently, .would .become .poorer.
.International .trade .is .a .zero-sum .game.
Absolute .advantage .- .CORRECT .ANSWER .-Theory .that .suggests .that .under .free
.trade, .a .nation .gains .by .specializing .in .economic .activities .in .which .it .has .an
.absolute .advantage .with .free .trade .market .forces .are .determined .with .little .to
.no .government .intervention. .The .economic .advantage .one .nation .enjoys .that .is
.absolutely .superior .to .other .nations. .International .trade .is .a .win-win .game.
.There .are .net .gains .from .trade.
, Comparative .advantage .- .CORRECT .ANSWER .-Theory .that .focuses .on .the
.relative .(not .absolute) .advantage .in .one .economic .activity .that .one .nation
.enjoys .in .comparison .with .other .nations. .It .suggests .that .the .U.S. .has .an
.absolute .advantage .over .China .in .both .wheat .and .aircraft, .but .as .longs .as
.China .is .not .equally .less .efficient .in .production .of .both .goods, .China .can .still
.choose .to .specialize .in .the .production .of .one .good. .There .are .net .gains .from
.trade. .
-opportunity .cost .is .a .crucial .concept .here.
Opportunity .cost .- .CORRECT .ANSWER .-The .cost .of .pursuing .one .activity .at .the
.expense .of .another .activity.
Factor .endowments .- .CORRECT .ANSWER .-The .extent .to .which .different
.countries .possess .various .factors .of .production .such .as .labor, .land, .and
.technology.
Modern .Theory .- .CORRECT .ANSWER .-1. .Product .life .cycle. .
2. .Strategic .trade. .
3. .National .competitive .advantage
Product .life .cycle .- .CORRECT .ANSWER .-A .theory .that .accounts .for .changes .in
.the .patterns .of .trade .over .time .by .focusing .on .product .life .cycle. .
1. .New: .production .of .a .new .product .that .commands .a .price .premium .will
.concentrate .in .the .United .States .which .exports .to .other .developed .nations.
2. .Maturing .stage: .demand .and .ability .to .produce .grow .in .other .developed
.nations .so .it .is .now .worthwhile .to .produce .there. .
3. .Standardized .(commoditized): .production .moves .to .low-cost .developing
.nations, .which .export .to .developed .nations. .Comparative .advantage .may
.change .over .time.
Strategic .trade .theory .- .CORRECT .ANSWER .-Suggests .that .strategic
.intervention .by .governments .in .certain .industries .can .enhance .their .odds .for
.international .success. .These .industries .tend .to .be .high .capital-intensive, .high-
entry-barrier .industries .in .which .firms .may .have .little .chance .without
.government .assistance. .These .industries .feature .first-mover .advantages.
Strategic .trade .policy .- .CORRECT .ANSWER .-Government .policy .that .provides
.companies .a .strategic .advantage .in .international .trade .through .subsidies .and
.other .supports.
First .mover .advantages .- .CORRECT .ANSWER .-Advantages .that .first .entrants
.enjoy .and .do .not .share .with .late .entrants.
National .competitive .advantage .- .CORRECT .ANSWER .-Theory .that .suggest .that
.the .competitive .advantage .of .certain .industries .in .different .nations .depends .on
.four .aspects .that .form .a ."diamond." .Theory .focuses .on .why .certain .industries
.within .a .nation .are .competitive .internationally.
