Test Bank For Principles of Managerial Finance 16th Edition By Chad Zutter, Scott Smart

Principles of
Managerial Finance
16 Edition
th

By Chad Zutter, Scott
Smart
(Test Bank All Chapters
100% Original Verified,
A+ Grade)
All Chapters Arranged Reverse: 19-1

,Principles of Managerial Finance, 16e (Zutter/Smart)
Chapter 19 International Managerial Finance

19.1 The multinational company and its environment

1) NAFTA was a treaty establishing free trade and open markets among Europe and the United
States.
Answer: FALSE
Diff: 1
Topic: Key Trading Blocs
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

2) The World Trade Organization is an international body established to police world trading
practices and to mediate disputes among member countries.
Answer: TRUE
Diff: 1
Topic: GATT and the WTO
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

3) The World Trade Organization (WTO) was established as part of the 1994 General Agreement
on Tariffs and Trade (GATT).
Answer: TRUE
Diff: 1
Topic: Financial Markets
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

4) NAFTA was an international financial market that provides for borrowing and lending
currencies outside their country of origin.
Answer: FALSE
Diff: 1
Topic: Financial Markets
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking




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,5) Fluctuations in foreign exchange markets can affect foreign revenues and profits of a
multinational company, but they have no impact on its overall value.
Answer: FALSE
Diff: 1
Topic: Key Trading Blocs
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

6) The Euromarket is the international financial market that provides for borrowing and lending
currencies outside their country of origin.
Answer: TRUE
Diff: 1
Topic: Financial Markets
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

7) The Euromarket provides multinational companies with an external opportunity to borrow or
lend funds with the additional feature of less government regulation.
Answer: TRUE
Diff: 1
Topic: Financial Markets
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

8) The trade agreement that replaced NAFTA is called The United States Mexico Canada
Agreement.
Answer: TRUE
Diff: 1
Topic: Financial Markets
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

9) A joint venture is a partnership under which the participants have contractually agreed to
contribute specified amounts of money and expertise in exchange for stated proportions of
ownership and profit.
Answer: TRUE
Diff: 1
Topic: Legal Forms of Business Organization
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking



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, 10) The official melding of the national currencies of the European Union into one currency, the
euro, created the European monetary union in 2002.
Answer: TRUE
Diff: 1
Topic: Key Trading Blocs
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

11) Mercosur is a major South American trading bloc that includes countries that account for
more than half of the total of Latin America's GDP.
Answer: TRUE
Diff: 1
Topic: Key Trading Blocs
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

12) The Mercosur is a major European trading bloc that includes former Soviet bloc countries in
Eastern Europe.
Answer: FALSE
Diff: 1
Topic: Key Trading Blocs
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

13) Multinational companies are firms that have international assets but operations in domestic
markets only and draw part of their total revenue and profits from such markets.
Answer: FALSE
Diff: 1
Topic: The Multinational Company and Its Environment
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking

14) After the election of President Donald Trump, the United States withdrew from a trade
agreement it had signed with several Pacific Rim countries in 2016 called the Trans-Pacific
Partnership.
Answer: TRUE
Diff: 1
Topic: Key Trading Blocs
Learning Objective: LG 1
Learning Outcome: F-30
AACSB: Analytical Thinking



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