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1)In Maddie’s company, senior officers eat in the same cafeteria as the entry-level workers. On a trip to a different country, she was surprised to find that the company had different cafeterias for managers and workers as well as different parking lots. The difference that Maddie perceived can be attributed to which of Hofstede's dimensions? Version 31 A) uncertainty avoidance B) individualism C) power distance D) collectivism E) masculinity 2)Many developing countries have a potential comparative advantage in manufacturing, but new manufacturing industries cannot initially compete with well-established industries in developed countries. This demonstrates the A) economic development argument. B) comparative advantage theory. C) national security argument. D) infant industry argument. E) mixed economy theory. 3)What are the three broad forms of economic systems? A) laissez-faire, authoritarian, egalitarian B) market, command, and mixed C) local, state, federal D) ethical, political, radical E) individualist, collectivist, majoritarian 4)A computer manufacturing firm from the United States invests in a microprocessor manufacturing plant in Taiwan. This is an example of A) an absolute advantage. B) stock consolidation. C) foreign direct investment. D) product differentiation. E) market segmentation. 5)When social unrest and disorder in a country cause drastic changes in its business environment that adversely affect the profit of a business, the business is facing a ________ risk. A) political B) demographic C) ethical D) technological E) physiological 6)SmartStuff Inc. grants a foreign entity the right to produce and sell the firm's microprocessors in return for a royalty fee on every product sold. SmartStuff Inc.'s approach is called A) outsourcing. B) licensing. C) franchising. D) exporting. E) diversifying. 7)JumpIn Products is a market leader in playground equipment, which is typically large, bulky, and very heavy. In order to compete, JumpIn Products sells its entire line at very low prices. Although its products can be produced anywhere, it is considering exporting as a way to grow in overseas markets. The viability of JumpIn Products' exporting strategy could be constrained by transportation costs, particularly of products that can be produced in almost any location and have a A) high local content requirement. B) low total landed cost. C) low value-to-weight ratio. D) low licensing tariff. E) high marginal cost. 8)MedFirst Instruments, a U.S. company, invests in a manufacturing facility in Mexico. The production from the Mexican facility is used entirely to serve the company's U.S. customers. MedFirst Instruments’ activity is called A) onboard production. B) offshore production. C) licensing. D) contract manufacturing. E) vertical integration. 9)The main goal of GATT was to A) limit foreign competition. B) make loans to struggling nations. C) increase domestic competition. D) privatize state-owned organizations. E) reduce trade barriers. 10)Silver Fire Electric Inc., a U.S.-based company, has productive activities in more than two countries. Silver Fire Electric is what type of enterprise? A) state-owned B) universal C) private D) multinational E) public 11)The influential economist Jeffrey Sachs argues that which of the following, with their long engagements in international trade, have been the most supportive of market institutions throughout history? A) mountainous states B) tropical regions C) military societies D) landlocked states E) coastal states 12)Complexion Care Inc., a U.S.-based skin care firm, was the first in the industry to identify the growth potential of Thailand and made huge investments in its economy. As a result, the firm was able to build brand loyalty and gain experience in that country's business practices. In this situation, Complexion Care Inc. has benefited from A) a first-mover advantage B) forward integration. C) unrelated differentiation. D) deregulation. E) privatization. 13)A macro factor underlying the trend toward greater globalization is the A) rise of communism across the globe. B) increase in nationalization of private organizations. C) increase in diversity in consumer tastes and preferences. D) increase in trade regulations across the globe. E) dramatic developments in information processing and other technologies. 14)Products of the mind, such as computer software, a screenplay, a music score, or the chemical formula for a new drug, constitute A) assets which receive no protection under law. B) non-performing assets. C) tangible assets. D) intellectual property. E) real property. 15)A firm is most likely to favor foreign direct investment over exporting when A) the firm wants its technological know-how to be widely disseminated. B) the firm wishes to maintain control over its operations and business strategy. C) the transportation costs are low. D) there are no trade barriers. E) the firm wants to customize its products as per the tastes and preferences of foreign consumers. 16)The purpose of Porter's study of national competitive advantage was to A) identify the various stages of the life cycle of a product. B) determine why a country achieves international success in a particular industry. C) determine how trade barriers affect the prices of products in the international market. D) determine how pre-industrialization theories predict international trade patterns. E) organize the relationship between factor endowments and economies of scale. 17)The Wilson logo can only be used on sports equipment produced by the Wilson Sporting Goods company. What protects the Wilson logo from being used by another manufacturer? A) trademark B) affidavit C) patent D) warrant E) contract 18)The sale of state-owned enterprises to independent, nonpublic investors is referred to as A) privatization B) nationalization C) collectivism D) communalism E) public action. 19)General Electric (GE) built an operation from scratch in Nigeria. This is an example of a(n) A) merger. B) acquisition. C) strategic alliance. D) FDI stock. E) greenfield investment. 20)Which type of economy was found in communist countries where the government determined what would be produced and the price it would be sold for? A) mixed B) market C) egalitarian D) command E) majoritarian 21)The WTO arbitrates trade disputes between its member states. What is one power of particular interest that the WTO can use? A) It can restrict the membership of nations in other supranational organizations such as the United Nations. B) It can grant loans to cash-strapped governments in poor nations. C) It supersedes IMF and has complete authority over IMF's actions. D) It can issue a ruling instructing a member-state to change trade policies that violate GATT regulations. E) It can make decisions related to international trade without considering the collective interests of member-states. 22)Fast food chain restaurants promote different menu choices in different countries depending on a range of factors such as demographics, local taste, income levels, and cultural values. This demonstrates that A) significant differences still exist among national markets. B) cultural diversity has been replaced by global uniformity. C) the global market is less complex than national markets. D) only multinational giants can benefit from the globalization of markets. E) the social norms in a country do not affect purchase decisions of consumers. 23)What is the new “sixth dimension” to be added to Hofstede’s original dimensions? A) sympathy versus empathy B) individualism versus collectivism C) static versus constancy D) indulgence versus restraint E) supply versus demand 24)Which political view argues that international production should be distributed among countries according to the theory of comparative advantage? A) conservative B) pragmatic nationalism C) free market D) radical E) planned 25)BrandLine Corp. has decided not to do business in a country after learning that many citizens are violently protesting recent government embargoes on food resources. BrandLine is concerned with the ________ risk associated with the country. A) political B) economic C) demographic D) legal E) technological 26)Which global institution has focused on making low-interest loans to governments in poor nations that want to make significant infrastructure investments such as building a road or a bridge? A) World Trade Organization B) World Bank C) Peace Corps D) International Monetary Fund E) United Nations 27)Cadmia and Rhodia specialize in the production of electronics and pharmaceutical products respectively. They are considered the best at their specializations. Cadmia trades electronics with Rhodia in exchange for pharmaceutical products. Which perspective is illustrated by this form of trade between Cadmia and Rhodia? A) product life-cycle theory B) Heckscher-Ohlin theory C) absolute advantage D) mercantilism E) theory of national competitive advantage 28)In the country of Burnada, citizens are restricted from moving out of the strata they are born into. Also, individuals are allowed to engage only in the same occupation as their parents. The system of social stratification being practiced in Burnada can be identified as a A) cluster system. B) caste system. C) merit-based system. D) class system. E) bureaucracy-based system. 29)Which legal system is