MANA 5360 EXAM 1 QUESTIONS WITH VERIFIED SOLUTIONS GRADED A+
When entering a new market, a traditionally domestic company will most likely attempt to
implement in the new market - Answers The same business model and modus operandi that
was successfully applied in their home country
The following is a good example of foreign direct investment - Answers Intel decides to acquire
a local Costa Rican manufacturer, a 100 million dollar deal, to offshore its production of
microprocessors
Which of the following is a consequence of globalization - Answers Increasing offshoring of
production and services
Which of the following is a GOOD example of OFFSHORING - Answers ArgCork, an Argentine
wine producer, buys three discontinued Mondavi locations in California and Oregon, to establish
its first US-based operation. They will import wine in bulk from its Argentine headquarters, and
bottle it in the US, to supply their expanding North America operations, without the need to
import finished products from Argentina into the US
Which of the following is a GOOD example of a multinational enterprise (MNE): - Answers
SoupHeaven, a Vietnamese fast food chain, opens 20 restaurants they will own and operate
across Canada, their first international venture
When _________ is politically emphasised in a society, _______. - Answers Collectivism; an
individual's right to do something may be restricted on the grounds that it runs counter to "the
good of society."
In a _______ law system, _________. - Answers Common; a judges ruling may be guided by
interpretations made in prior legal cases
Which of the following statements is TRUE regarding totalitarian regimes - Answers It is
possible to have a totalitarian state that is hostile to collectivism and where some degree of
individualism is encouraged
Which of the following statements is TRUE about rule of law: - Answers The higher the rule of
law in a country, the better the chances laws and contracts will be enforceable.
Which of the following statements is TRUE about rule of law: - Answers Most countries rule of
law can and has been measured over the years by World Bank's Worldwide Governance
Indicators
You are an international business analyst studying a foreign market entry. You sell luxury goods,
such as Masseratti automobiles. In your case, to determine in which country to enter, it is
critical to account for the potential for that country to have the best market for that car, meaning
comparing the countries in terms of the market of people that can afford it. Assuming the listed
,variables is all the information you have, you should: - Answers go to the country with the
highest GNI per capita at PPP (Gross national income per capita at PPP)
It has been proven that privatization may fail to deliver predicted benefits if the newly privatized
firms: - Answers Are sheltered from foreign competition
About the relationship between political economy and economic growth and development, the
following statement is TRUE: - Answers The state can expropriate the profits from innovation,
and thus decrease the incentives to innovate, through legal means.
The higher the level of economic freedom, the _______ incentives for _____ and, and thus, the
better the chances for economic growth and development - Answers higher innovation,
entrepreneurship
A country has an absolute advantage in the production of a product when: - Answers it is more
efficient than any other country in producing it
A country has an absolute advantage in the production of a product when it ____. - Answers is
more efficient than any other country in producing it
The concepts of absolute and comparative advantage show: - Answers why it is beneficial for a
country to engage in international trade even for products it is able to produce for itself
Imagine your country can produce both products A and B more efficiently than any other country.
But also assume that you are more efficient in producing A than in producing B. According to
the concept of COMPARATIVE ADVANTAGE, your country should: - Answers produce A and not
B, and import B from another country
Free trade refers to: - Answers a situation where a government does not attempt to influence
through quotas or duties what its citizens can buy from another country, or what they can
produce and sell to another country
Starting in 2018, a trade conflict between the US and China developed after the US imposed
tariffs on Chinese imports into the US, as a part of Trump's administration's intent to 'get jobs
back' and 'restore fair trade'. Responses and counter responses from both sides escalated and
by early 2019 the two nations had swapped tariffs on more than $200 billion of goods.
This is an example of: - Answers protectionist US policies triggering retaliatory interventions in
free trade responses by the Chinese
Strategic trade policy suggests that a government should use _____________ to support
promising firms that are active in newly emerging industries, and thus helping them
_____________: - Answers subsidies; gain first-mover advantages
Starting in 2018, a trade conflict between the US and China developed after the US imposed
tariffs on Chinese imports into the US, as a part of Trump's administration's intent to 'get jobs
, back' and 'restore fair trade'. Responses and counter responses from both sides escalated and
by early 2019 the two nations had swapped tariffs on more than $200 billion of goods. The
automotive industry was particularly impacted as exports became less competitive for most
global players.
In late 2018, US-based Tesla announced it would build a factory in China to allow it to serve the
Asian market without paying the import tariffs imposed to Cars manufactured in the US.
This is an example of: - Answers intervention in free trade by US imposition of import tariffs may
ultimately back fire and cause outward FDI by US firms into target, or more free-trade oriented,
foreign countries
__________ is defined as selling goods in a foreign market at below their costs of production or
as selling goods in a foreign market at below their "fair" market value: - Answers Dumping
By _______ production costs, subsidies help domestic producers in ______________: - Answers
lowering; both competing against foreign imports, and gaining export markets
The following statement is TRUE:
a) The WTO is an international court, in which its judges rule and their decisions are binding, and
if offenders fail to comply with the WTO judges' recommendations, trading partners have the
right to compensation or to impose trade sanctions
b)The WTO publishes arbitration panel reports on trade disputes, and such reports are merely
used as general guidelines for trading partners; they cannot be used to determine a right to
compensation, or to impose trade sanctions
c)The WTO does not have the power to determine a right to compensation or to impose trade
sanctions
d) The WTO publishes arbitration panel reports on trade disputes, but if offenders fail to comply
with the panel's recommendations, trading partners have the right to compensation or to
impose trade sanctions - Answers The WTO publishes arbitration panel reports on trade
disputes, but if offenders fail to comply with the panel's recommendations, trading partners
have the right to compensation or to impose trade sanctions
The term offshore production refers to FDI undertaken to: - Answers serve the home market
from a low-cost production location
Which of the following is a home-country policy aimed at limiting outward FDI flow? - Answers
Taxing domestic companies' foreign earnings at a higher rate than their domestic earnings
The _____ of ______ FDI refers to the aggregated amount of FDI made by a foreign multinationals
into a country throughout its history, until a point of time: - Answers stock; inward
When entering a new market, a traditionally domestic company will most likely attempt to
implement in the new market - Answers The same business model and modus operandi that
was successfully applied in their home country
The following is a good example of foreign direct investment - Answers Intel decides to acquire
a local Costa Rican manufacturer, a 100 million dollar deal, to offshore its production of
microprocessors
Which of the following is a consequence of globalization - Answers Increasing offshoring of
production and services
Which of the following is a GOOD example of OFFSHORING - Answers ArgCork, an Argentine
wine producer, buys three discontinued Mondavi locations in California and Oregon, to establish
its first US-based operation. They will import wine in bulk from its Argentine headquarters, and
bottle it in the US, to supply their expanding North America operations, without the need to
import finished products from Argentina into the US
Which of the following is a GOOD example of a multinational enterprise (MNE): - Answers
SoupHeaven, a Vietnamese fast food chain, opens 20 restaurants they will own and operate
across Canada, their first international venture
When _________ is politically emphasised in a society, _______. - Answers Collectivism; an
individual's right to do something may be restricted on the grounds that it runs counter to "the
good of society."
In a _______ law system, _________. - Answers Common; a judges ruling may be guided by
interpretations made in prior legal cases
Which of the following statements is TRUE regarding totalitarian regimes - Answers It is
possible to have a totalitarian state that is hostile to collectivism and where some degree of
individualism is encouraged
Which of the following statements is TRUE about rule of law: - Answers The higher the rule of
law in a country, the better the chances laws and contracts will be enforceable.
Which of the following statements is TRUE about rule of law: - Answers Most countries rule of
law can and has been measured over the years by World Bank's Worldwide Governance
Indicators
You are an international business analyst studying a foreign market entry. You sell luxury goods,
such as Masseratti automobiles. In your case, to determine in which country to enter, it is
critical to account for the potential for that country to have the best market for that car, meaning
comparing the countries in terms of the market of people that can afford it. Assuming the listed
,variables is all the information you have, you should: - Answers go to the country with the
highest GNI per capita at PPP (Gross national income per capita at PPP)
It has been proven that privatization may fail to deliver predicted benefits if the newly privatized
firms: - Answers Are sheltered from foreign competition
About the relationship between political economy and economic growth and development, the
following statement is TRUE: - Answers The state can expropriate the profits from innovation,
and thus decrease the incentives to innovate, through legal means.
The higher the level of economic freedom, the _______ incentives for _____ and, and thus, the
better the chances for economic growth and development - Answers higher innovation,
entrepreneurship
A country has an absolute advantage in the production of a product when: - Answers it is more
efficient than any other country in producing it
A country has an absolute advantage in the production of a product when it ____. - Answers is
more efficient than any other country in producing it
The concepts of absolute and comparative advantage show: - Answers why it is beneficial for a
country to engage in international trade even for products it is able to produce for itself
Imagine your country can produce both products A and B more efficiently than any other country.
But also assume that you are more efficient in producing A than in producing B. According to
the concept of COMPARATIVE ADVANTAGE, your country should: - Answers produce A and not
B, and import B from another country
Free trade refers to: - Answers a situation where a government does not attempt to influence
through quotas or duties what its citizens can buy from another country, or what they can
produce and sell to another country
Starting in 2018, a trade conflict between the US and China developed after the US imposed
tariffs on Chinese imports into the US, as a part of Trump's administration's intent to 'get jobs
back' and 'restore fair trade'. Responses and counter responses from both sides escalated and
by early 2019 the two nations had swapped tariffs on more than $200 billion of goods.
This is an example of: - Answers protectionist US policies triggering retaliatory interventions in
free trade responses by the Chinese
Strategic trade policy suggests that a government should use _____________ to support
promising firms that are active in newly emerging industries, and thus helping them
_____________: - Answers subsidies; gain first-mover advantages
Starting in 2018, a trade conflict between the US and China developed after the US imposed
tariffs on Chinese imports into the US, as a part of Trump's administration's intent to 'get jobs
, back' and 'restore fair trade'. Responses and counter responses from both sides escalated and
by early 2019 the two nations had swapped tariffs on more than $200 billion of goods. The
automotive industry was particularly impacted as exports became less competitive for most
global players.
In late 2018, US-based Tesla announced it would build a factory in China to allow it to serve the
Asian market without paying the import tariffs imposed to Cars manufactured in the US.
This is an example of: - Answers intervention in free trade by US imposition of import tariffs may
ultimately back fire and cause outward FDI by US firms into target, or more free-trade oriented,
foreign countries
__________ is defined as selling goods in a foreign market at below their costs of production or
as selling goods in a foreign market at below their "fair" market value: - Answers Dumping
By _______ production costs, subsidies help domestic producers in ______________: - Answers
lowering; both competing against foreign imports, and gaining export markets
The following statement is TRUE:
a) The WTO is an international court, in which its judges rule and their decisions are binding, and
if offenders fail to comply with the WTO judges' recommendations, trading partners have the
right to compensation or to impose trade sanctions
b)The WTO publishes arbitration panel reports on trade disputes, and such reports are merely
used as general guidelines for trading partners; they cannot be used to determine a right to
compensation, or to impose trade sanctions
c)The WTO does not have the power to determine a right to compensation or to impose trade
sanctions
d) The WTO publishes arbitration panel reports on trade disputes, but if offenders fail to comply
with the panel's recommendations, trading partners have the right to compensation or to
impose trade sanctions - Answers The WTO publishes arbitration panel reports on trade
disputes, but if offenders fail to comply with the panel's recommendations, trading partners
have the right to compensation or to impose trade sanctions
The term offshore production refers to FDI undertaken to: - Answers serve the home market
from a low-cost production location
Which of the following is a home-country policy aimed at limiting outward FDI flow? - Answers
Taxing domestic companies' foreign earnings at a higher rate than their domestic earnings
The _____ of ______ FDI refers to the aggregated amount of FDI made by a foreign multinationals
into a country throughout its history, until a point of time: - Answers stock; inward
