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QUIZ CHAP 1

The correct answer for each question is indicated by a .


Chapter Quiz no Globalization 1 4314285 1

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1 2
1 INCORRECT
Most global markets are for consumer goods despite the national differences in tastes and preferences.

True
A)

False
B)

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2
UNANSWERED Foreign direct investment occurs when a firm invests resources in business activities outside its home
country.

True
A)

False
B)

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3 CORRECT
The crisis that began in the financial sector of the United States during 2007 and 2008 swept around the
world and plunged the global economy into a deep recession is something new and without precedent in
the history of globalization.

True
A)

False
B)

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4 INCORRECT
Globalization has been blamed for

unemployment in developed nations.


A)

the preservation of national culture.


B)

environmental protection regulations.


C)

economic political isolation.


D)
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5 INCORRECT
The two main components of globalization are:

the globalization of markets and the globalization of production.


A)

the globalization of production and the globalization of finance.


B)

the standardization of technology and the globalization of markets.


C)

the globalization of finance and the globalization of accounting.


D)

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6 CORRECT
The IMF:

provides loans to countries at rates comparable to many commercial banks.


A)

provides loans that countries can use as they see best fit to improve their economies.
B)

has been criticized for making inappropriate policy recommendations.


C)

prefers not to make loans to troubled states because of the risks involved.
D)

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7 CORRECT
Since the beginning of the 21st century, the flow of FDI:

has risen consistently.


A)

had reached about $1.8 trillion in 2007.


B)

has barely kept pace with the growth in world trade and world output.
C)

led to concentrated growth in a little more than 5,000 companies worldwide.


D)

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Difficulty: Easy
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8 CORRECT
Which of the following best describes the technological change that has been a driver of globalization?

Communications has not kept pace with other areas.


A)

The microprocessor may be the single most important innovation.


B)
The Internet is important for gaming and social media within the domestic economy, but has yet to
realize promise in globalization.
C)

Despite the widespread use of containerization, transportation costs continue to rise.


D)

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9 INCORRECT
Which of the following is NOT one of drivers that has made the globalization of production feasible?

Decline of transportation costs


A)

Falling costs of information processing


B)

World-wide communications networks


C)

New applications for social media


D)

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10 CORRECT
In the early 1960s, the United States was by far the world's dominant industrial power, but:

even with the relative decline, it is still the largest industrial power.
A)

Germany, France and Italy have growth rates that suggest they may soon overtake the US.
B)

China's share of world GDP is still small given its large population.
C)
though some Asian countries have increased their share of world exports, the US will remain the
world's leading exporter for some time to come.
D)

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11
INCORRECT The foreign direct investment by non-U.S. firms was motivated primarily by the following two factors –
the desire to:
disperse production activities to optimal locations and build a direct presence in major foreign
markets.
A)

disperse production activities to optimal locations and influence foreign exchange rates.
B)

influence foreign exchange rates and influence political developments in foreign countries.
C)
build a direct presence in major foreign markets and influence political developments in foreign
countries.
D)

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Page 19
Difficulty: Medium
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12
INCORRECT Medium-size and small multinationals (mini-multinationals):

are not significant players in international business.


A)

have not grown significantly.


B)

have few of the same issues of complexity that large multinationals do.
C)

are becoming increasingly involved in international business.


D)

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Difficulty: Easy
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13
INCORRECT In Seattle, during December 1999, massive protests against globalization captured the attention of the
world. Which of the following was not an issue the protesters raised?

Domestic job losses


A)

Downward pressure on wage rates of unskilled workers


B)

Environmental standards that were too strict


C)

Cultural imperialism of global media and multinational enterprises


D)

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14
INCORRECT One of the criticisms of the WTO is the concern that the organization will undermine the sovereignty of
nations who are members. Which of the following is not a criticism in this area?

Democratically elected governments must submit to unelected bureaucrats from other countries.
A)

Nations can no longer control their own destiny.


B)
There is a lack of transparency and accountability.
C)
The power of the organization rests largely on the ability to persuade member states to follow a
certain action.
D)

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Difficulty: Easy
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15
INCORRECT Successful managers in international business:

should pay little attention to governments and focus on the needs of the business.
A)
should focus on the values and systems of the home country instead of trying to figure out the
nuances in other countries.
B)

insist that payments be made in U.S. dollars to avoid losses in currency transactions.
C)

face issues more complex than the issues managers face in strictly domestic business.
D)

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QUIZ CHAP 2

The correct answer for each question is indicated by a .


Chapter Quiz no National Differenc 2 4314286 1

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1
INCORRECT Both U.S. law and OECD conventions condemn all forms of bribery with the exception of grease payments,
which expedite the performance of routine government action.

True
A)

False
B)

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Difficulty: Medium
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2
INCORRECT Although democracy may not always be the cause of initial economic progress, it seems to be one
consequence of that process.

True
A)

False
B)

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Difficulty: Easy
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3
INCORRECT In the 1980s and 90s two trends characterized the world's nation-states – a wave of democratic revolutions
and a strong move away from planned economies.

True
A)

False
B)

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Pages 68
Difficulty: Medium
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4
INCORRECT A country's political, economic, and legal system constitutes its:

legal economy.
A)

political economy.
B)

economic economy.
C)

FDI economy.
D)

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Difficulty: Medium
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5 CORRECT
___________ refers to a political system where the needs of society as a whole are seen as more important
than individual freedoms.

Totalitarianism
A)

Representative democracy
B)

Collectivism
C)

Individualism
D)

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Page 43
Difficulty: Medium
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6
INCORRECT Which of the following does NOT describe essential elements of individualism?

The ground rules of a society should be based on individual economic and political freedoms.
A)
The Cold War was a war between the ideas of collectivism and individualism.
B)
The welfare of society is based on economic self-interest, but those interests must be subordinate to
the interests of the country to be effective.
C)

Individualism leads to advocacy for free market economics.


D)

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Difficulty: Medium
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7
INCORRECT The three general types of economic systems are:

free, limited and fixed.


A)

industrial, service and social.


B)

international, domestic and multi-domestic.


C)

market, command and mixed.


D)

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