3. global context of business (ITB ECO)
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This document summarizes key concepts about international business and globalization from a textbook chapter. It defines important terms like imports, exports, and per capita income. It also outlines several forces driving globalization like new technologies and competitive pressures. Additionally, it describes major world marketplaces in regions like North America, Europe, and Asia and discusses trade agreements and concepts such as comparative advantage and balance of trade.
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Describe the current status of the European Union
Discuss the North American Free Trade Agreement.
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QUESTION 1There are three types of economic integration, namely.docx
QUESTION 1
There are three types of economic integration, namely: global, regional, and local.
True
False
4 points
QUESTION 2
Purchasing power parity is the price of one currency in terms of another.
True
False
4 points
QUESTION 3
When the United States sells products to China, US exporters often demand that they be paid in the Chinese yuan.
True
False
4 points
QUESTION 4
Three EU members—Britain, Denmark and Sweden—do not use the euro as their currency.
True
False
4 points
QUESTION 5
NAFTA is an example of a common market.
True
False
4 points
QUESTION 6
Which of the following is NOT an advantage of a strong US dollar?
US consumers benefit from low prices on imports.
US tourists benefit from lower prices when traveling abroad.
Lower prices on foreign goods help keep US prices level and inflation low.
US firms in import-competing industries face more low-cost imports.
4 points
QUESTION 7
Which does “ASEAN” stand for?
Assembly of Southeast Asian Nations
Assembly of South American Nations
Association of Southeast Asian Nations
Association of South American Nations
4 points
QUESTION 8
In the trade relationship with China, why is the US dollar in more demand than the Chinese yuan?
More people demand the yuan domestically in China, so it is not used for imports and exports.
The dollar is the common transaction currency between the two countries.
The yuan is pegged to the US dollar.
Formal institutions and regulations demand the trade be conducted in the dollar.
4 points
QUESTION 9
Why was the US dollar chosen as the currency to which other currencies would be pegged?
The US had high levels of productivity.
The US was experiencing a large trade surplus.
The US contributed approximately 70% of the global GDP.
All of these answers
4 points
QUESTION 10
Non-MNE firms can also do business abroad by:
Licensing and franchising
Outsourcing and engaging in FDI
Exporting and importing
All of these answers
4 points
QUESTION 11
The motto of international business is location, location, location.
True
False
4 points
QUESTION 12
Owners, managers, and employees at entrepreneurial firms tend to be more innovative and take more risks than those at large firms.
True
False
4 points
QUESTION 13
Late movers face greater technological and market uncertainties.
True
False
4 points
QUESTION 14
Sometimes foreign firms are discriminated against:
Formally
Informally
Randomly
Both formally and informally
4 points
QUESTION 15
First-mover advantages include:
Opportunity to free ride on first-mover investments
Resolution of technological and market uncertainties
Difficulty to adapt to market changes
Avoidance of a clash with dominant firms at home
4 points
QUESTION 16
Which item is not a late-mover advantage?
Avoidance of a clash with a d.
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- 1. CHAPTER 4 Understanding the Global Context of Business Copyright 2004 Prentice Hall, Inc.
- 3. What Is Globalization? Process by which the world economy is becoming a single interdependent system Copyright 2004 Prentice Hall, Inc.
- 4. What Are Imports and Exports? Imports are products made or grown abroad but sold domestically, while exports are products made or grown domestically but shipped and sold abroad Copyright 2004 Prentice Hall, Inc.
- 6. The Price of Global Communication Copyright 2004 Prentice Hall, Inc.
- 8. The North American Marketplace and the Nations of NAFTA Copyright 2004 Prentice Hall, Inc.
- 11. Europe and the Nations of the European Union Copyright 2004 Prentice Hall, Inc.
- 12. The Nations of ASEAN Copyright 2004 Prentice Hall, Inc.
- 13. The Major Trading Partners of the U.S. Copyright 2004 Prentice Hall, Inc.
- 15. Attributes of National Competitive Advantage Copyright 2004 Prentice Hall, Inc.
- 20. Canadian vs. U.S. Prices Copyright 2004 Prentice Hall, Inc.