BUSI 303 Quiz 2 International Business Environment & Trade Theory solutions complete answers

BUSI 303 Quiz 2 International Business Environment & Trade Theory solutions complete answers 

 

Program was created in 1934 to alleviate some of the costs associated with free trade in the rapidly increasing global economic environment.

 

Customs officials determine which nations will be allowed to import goods into the domestic system while denying other nations because no room exists for their products.

 

Is the official export credit agency of the United States and is a valuable tool for small businesses because it does not require a minimum transaction limit.

 

Is essential to comprehend how various organizations including the United Nations, the World Trade Organization, and the World Bank classify nations.

 

_______ are special privileges offered by the government in order to attract businesses to a region or to provide them with the funding to operate successfully.

 

Which of the following is NOT a purpose behind embargoes?

 

Tariffs is a system whereby a nation attempts to regulate the value of its own money within its borders.

 

The U.S. Department of Commerce developed the International Trade Administration (ITA) in order to stimulate economic opportunities for U.S. businesses and their employees.

 

Which of the following are designated areas in Customs Ports of Entry that allow commercial merchandise to receive the same customs treatment it would receive if it were outside the commerce of the United States.

 

International trading is very important to a nation because it generates business and government revenue and promotes varying levels of trust between trading partners.

 

Provides a minimum protection of property rights that are independent of the nation in which the work originated. The agreement made protects the artistic domain of authors in regards to literary works, such as novels, songs, and compositions.

 

Is more closely associated with long-term loans. Some international projects may take more than four years to complete; therefore, the financial institution needs the ______ to protect parties from potential problems that might arise during this extended time period.

 

Trade surplus occurs when a country is importing more than it is exporting.

 

Quotas typically

 

This type of transaction requires extra time and energy, to make sure that buyers are reliable and creditworthy. A company increases payment time when it sells and ships a product overseas.

 

Most U.S. states have developed special government agencies to partner with constituent companies to do business overseas.

 

Protect specific signs and trademarks that distinguish specific goods and services from other goods and services.

 

The Whopper Index is often used as an example for PPP in that the product is the same wherever you are in the world and involves several commodities such as agriculture, labor, advertising, real estate cost, and transportation.

 

Which of the following are types of risk companies are exposed to in international transactions?

 

Means by which governments can block open trade within a country’s borders. These requirements can hinder foreign exports from reaching a nation or from being purchased in the domestic market and place restrictions on domestic businesses.

 

Equity capital is the value of the MNC’s investment in shares of an enterprise in a foreign country.

 

The activity, known as __________ is when companies opt to purchase land or other resources in other nations.

 

Which of the following is NOT a strategic goal of FDI?

 

If the goal is complete ownership in a foreign entity, the next business decision is ownership and control?

 

These cost savings attract international corporations desiring to increase profits while maintaining competitive prices in the global market.

 

Government interventions can increase global competitiveness for their businesses, keep the balance of payments under control, and help acquire new technologies and managerial skills from foreign firms entering their markets; it can also promote protectionism.

 

Was signed on January 1, 1948. Even though this agreement was accepted as provisional, it existed as an international trade agreement until 1995.

 

In a historic sense, globalism is the economic policy of applying tariffs on imported goods for government funding to reduce or eliminate the need for taxation on domestic industries.

 

The Balance of Payments

 

Factors of production include labor, capital, and cost.

 

Attempts to explain that nations will produce and export goods that use the highest proportion of those factors of production that are most abundant to a nation.

 

Governments play a major role in support of technology by crafting industry-specific measures, such as tax credits for research and development of new technologies and trade policies that support essential technology sectors.

 

Keeping track of the activity surrounding international trade and investment is done by maintaining a record of all international transactions, otherwise known as the balance of payments (BOP).

 

Nations can benefit from trade even when one trading partner does not have an absolute advantage on any of the products being traded.

 

When considering FDI, the most important consideration facing a corporation is the type of ________ and ________ the investing corporation will have over the foreign entity.

 

If a nation’s ________ far exceed its ______, then the balance of payments is out of control, or more simply stated, out of balance.

 

The WTO encourages nations to practice the Golden Rule on a national level, pointing out that foreigners and foreign industries should be treated just like the locals and domestic industries.

 

All of the following are factors that can affect the international BOP and either create or reduce surpluses and deficits except

 

Two forms companies can engage in FDI include

 

Though the World Trade Organization (WTO) has officially existed since 1995, the foundation for the rules in this trading system originates in the GATT.

 

Loan in which the exporter is covered, but the value of the cover will be less than the value of the contract.

 

The WTO classifies __________ into three broad categories: equity capital, reinvested earnings, and other capital.

 

The WTO was designed to

 

Cultures such as China, North Korea, and Cuba believe that an economic value system should be founded on cumulative efforts, controlled by greater entities or governments.

 

The two ways companies can engage in FDI include

 

Which of the following is an economic and trade sanctions against targeted foreign countries, groups, organizations, and individuals and can be motivated by political, economic, or moral reasons?

 

Government interventions may be used to decrease global competitiveness.

 

Nations that primarily functioned under the centrally planned economic system prior to the 1980s, such as China and Russia, have embraced the market economy.

 

Political issues that significantly impact global business include

 

In mathematical terms the current account is expressed as

 

The Organization for Economic Cooperation and Development (OECD), the World Trade Organization, the World Bank, and the International Monetary Fund have all indicated that unstable political systems are the greatest single barrier to economic development worldwide.

 

Government interventions may

 

Socialism is the economic policy of restraining trade between nations.

 

Which of the following places power in the hands of customs officials?

 

Specific government actions that promote trade include all except

 

The idea behind Foreign Direct Investment is to buy physical assets or a significant amount of ownership of a firm in another nation to gain a measure of managerial control.

 

The three factors that can affect the international Balance of Payments (BOP) and either create or reduce surpluses and deficits are Price of domestic goods,Trade agreements, and taxes and tariffs.

 

Within the legal aspects of international business the types of laws used across nations are Common, Natural, and Theocratic.

 

Which of the following is designed to raise revenue for governments and provide a competitive advantage for domestic businesses?

 

A market economy most often refers to an economic system that is under comprehensive control and regulation by a government, in accordance with the plan of economic development.

 

Ownership in foreign entities can be a complete or a controlling stake in the form of either a joint venture or through stock purchases and acquisitions of existing corporations.

 

In 1975, as business and policy makers’ alike saw the potential growth of global business, the World Trade Organization (WTO) was created by several countries in order to monitor trade around the entire world.

 

The General Agreement on Tariffs and Trade (GATT) was signed on January 1, 1948.

 

In order to achieve economic advantage, a nation should specialize, produce, and export only products where the nation holds an absolute advantage.

 

Global business risk is any worldwide factor—outside the laws of supply and demand—that could impact the success or failure of any venture moving into the international arena.

 

Which of the following is NOT a way that Governments promote trade?

 

Any company considering moving into a foreign economic market must consider the powerful influence of the military and religious leadership.

 

The United States Department of the Treasury oversees and enforces all U.S. economic sanctions through the Office of Foreign Assets Control (OFAC).

 

As organizations become more involved in the global community, they may opt to purchase land or other resources in other nations. This activity, known as foreign direct investment (FDI), is commonly used to purchase real estate and existing properties.

 

Which of the following is NOT true regarding GATT?

 

Operation risk occurs when debtors in a country are unable to ensure timely payments of foreign currency debt service because of either transfer or exchange restrictions or a general lack of foreign currency.

 

The equation represents the relationship between trade deficits and surpluses is expressed as: Exports – Investments = Savings – Imports

 
 
 

Operations of production are moved to a less-developed nation and the cycle is complete as highly-developed nations become importers of this product.

 

__________ imposes a waiting period between the determination of a product's quality and the determination of when it can actually be sold in a market.

 

The Whopper Index is often used an example for PPP in that the product is the same wherever you are in the world and involves several commodities such as agriculture, labor, advertising, real estate cost, and transportation.

 

The rights given to persons over the creations of their minds. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time.

 

Adam Smith first proposed the theory in his An Inquiry into the Nature and Causes of the Wealth of Nations (1776). In order to achieve economic advantage, a nation should specialize, produce, and export only products where the nation holds on _____.

 

Through the World Trade Organization (WTO) has officially existed since 1995, the foundation for the rules in the trading system originates in the GATT.

 

Which of the following are types of risks companies are exposed to in international transactions?



The rights given to persons over the creation of their minds. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time.