Assignment C

1. Which one of the following is not an assumption of the Ricardo Model :

a) Constant returns to scale
b) Factors of production can be transferred easily one sector to another
c) There is perfect competition in the market
d) Technological innovation is a unique feature of the market structure

2. Which of the following is not a form of Non Tariff Barrier

a) Subsidies
b) Local Content Requirement
c) Ad valorem Duties
d) Technical Standards
3. Which of the following is not an underlying principle of GATT?
a) Trade concessions by member countries will be reciprocated
b) Countries should grant preferential treatment to other member countries
c) Trade dispute between member countries to be settled by dispute settlement
mechanism of GATT
d) Policies governing external trade should be transparent

4. Which of the following is not an example of Quantitative Restriction on trade?

a) Quotas
b) Voluntary Export Restraint
c) Embargo
d) Subsidies

5. India is an example of which type of Economic System

a) Mixed Economy
b) Command Economy
c) Market Economy
d) Centrally Planned Economy

6. In a command economy or centrally planned economy

a) Government owns and controls all resources
b) Society owns and controls all resources

c) Community owns and controls all resources

d) Private entities owns and controls all resources

7. Which of the following economic indicator is used to rank countries in terms of their
individual wealth by World Bank?
a) GDP per capita
b) GNI per capita
c) PPP
d) GNI

8. Dumping which is a type of non-tariff barriers means

a) Selling products at less than fair value
b) Selling goods that are mass produced in an economy
c) Selling goods utilizing old technology
d) Selling goods of inferior quality

9. In which type of trade agreement no duties are charged on imports from member
countries
a) Preferential Trade Agreement
b) Free Trade Agreement
c) Custom Union
d) None of the above
10. Which of the following was not an achievement of the Uruguay Round of
negotiations?
a) Agreement on services
b) Protection of Intellectual property rights
c) 10 year phase out of MFA
d) Agreement on Trade in Agriculture
11. WTO was formed during which round of negotiations ?
a) Uruguay Round
b) Doha Round
c) Singapore Round
d) Tokyo Round
12. How inflation and Exchange rate are related to each other?

a)
b)
c)
d)

Higher inflation leads to currency devaluations

Higher inflation leads to currency appreciation
High inflation leads to currency stability
There is no relation between inflation and exchange rate

13. External Debt is measured as

a) Total External Debt of a country
b) Debt as percentage of GDP
c) Total of Fiscal deficit and External borrowings
d) Both i and ii above

14. What is a convertible currency?

a) Currency that can be freely traded with other currencies
b) Currency that can be traded only with hard currencies
c) Currencies of the Asian Countries
d) Currencies of the developed countries

15. Currency Speculation is done to

a) Cover risk and earn profit
b) Cover risk
c) Maintain foreign currency account to earn interest
d) None of the above
16. ICICI and Prudential joined together to market Insurance products in India. This
strategy is
a) a) exporting
b) b) licensing
c) c) joint venture
d) d) assembly operations
17. To sell to their subsidiaries in countries with lower corporate tax rates than that in
the United States, American firms should make their transfer prices
a) a) low
b) b) high
c) c) moderate
d) d) no change

18. Which of the following is not a driver of globalization?

a) The fragmentation of consumer tastes between countries.
b) The competitive process
c) Multinational companies successfully persuading governments to lower
trading barriers.
d) The need to gain economies of scale.
19. Hofstede argues that:
a) International firms can easily transfer their ways of working from one country
to another.
b) Business does not need to take into account the norms and values of the
countries where they operate.
c) Each country has a single culture.
d) National culture is more influential than organizational culture.
20. Several governments have reduced taxes on companies. Select one of the reasons
below that help explain why governments are doing this.
a)
b)
c)
d)

To cut company production costs

To reduce government borrowing.
To reduce the budget deficit
To retain and attract investment by multinational companies.

21. Why might arbitration be an attractive option for settling disputes in international
trade and investment cases?
a)
b)
c)
d)

It is more costly than going through national courts.

The decisions of the arbitrator can be widely enforced.
The proceedings are made public.
There is no right of appeal.

22. Acquiring and managing funds in the global market is the primary emphasis of
a) lawyers.
b) treasurers.
c) financial managers.
d) bankers.
e) accountants.
23. A strategy of ______ pricing involves using price as a competitive weapon in order
to push competitors out of a national market.

a)
b)
c)
d)

premium
predatory
incremental
psychological

24. Implementing a global standardized advertising programme has the following

advantage(s) to a firm internationalizing:
a)
lower costs.
b)
economic advantages.
c)
creative talent can be more readily and efficiently tapped.
d)
all of the above.
25. Countries in which the retail systems are fragmented tend to have:
a)
longer distribution channels.
b)
few suppliers.
c)
less customers.
d)
no cartels.
26. ______ has been a pioneer in the hypermarket retailing concept.
a)
Virgin Megastores
b)
Carrefour
c)
Wal-Mart
d)
Body Shop

27. What is the main benefit of acquisitions over other hierarchical entry modes?
a)
Cheaper entry.
b)
No corporate tax.
c)
Rapid entry.
d)
None of the above.
28. The term 'royalties' is closely associated with:
a)
contract manufacturing.
b)
piggybacking.
c)
licensing.
d)
direct exporting
29. The German rules for bookkeeping are said to be conservative. This means that the
German rules are:

a)
b)
c)
d)

dating back to the 19th century

understating the value of assets and income
have been introduced by a right-wing government
overvaluing their assets

30. US rules on bookkeeping require a larger degree of disclosure than the German
system. The reason for this difference is:
a)
b)
c)
d)

The Enron bookkeeping fraud in the US

The higher level of globalisation of the US economy
The high level of equity financed by share holders in the US
The higher level of equity is financed by the banks

31. The sum of all goods and services produced in a country during a year is called
a) real income.
b) gross domestic product.
c) real gross national product.
d) balance of trade.
e) gross international product.
32. Which of the following is not a part of strategic management?
a) Environmental Analysis
b) Evaluation and control
c) Capital budgeting
d) PEST analysis
33. Which of the following is not a type of departmentalization?
a) functional
b) product
c) geographical
d) hierarchy
34. Businesses tend to be more ____ when the decisions to be made are risky.
a) decentralized
b) productive
c) informal
d) line-and-staff oriented
e) centralized

35. An organization's shared values, beliefs, traditions, philosophies, rules, and heroes
represent its
a) organizational culture.
b) grapevine.
c) organizational manual.
d) formal organization.
e) information organization
36. In Porter's Diamond it is argued that a nation will not be competitive when:
a)
b)
c)
d)

National firms have to face much domestic competition.

Domestic customers are very sophisticated.
Firms in the supply chain are themselves internationally competitive.
There is a shortage of 'advanced factors'.

37. This export strategy involves selling a product from a home base, usually without
any product modification.
a) exporting
b) licensing
c) joint venture
d) manufacturing
38. This entry strategy involves granting permits to a foreign company to use industry
property, technical knowhow, or engineering design in a foreign market.
a) exporting
b) licensing
c) joint venture
d) manufacturing
39. This international organization wants to achieve a broad, multilateral, and free
worldwide system of trading.
a) WTO
b) GSP
c) UNCTAD
d) MFN
40. "Noise" does not affect this stage of the communication process.
a) sender
b) encoding
c) decoding

d) receiver
e) all of them can be affected