INTB 1203 EVALUATION EXAMS ANSWERS AND
QUESTIONS SET A+
✔✔Liberalized market economies - ✔✔Coordination occurs primarily through market
mechanism
✔✔Coordinated market economies - ✔✔Formal institutions play central role in
coordinating relationships
✔✔Opacity Index - ✔✔Determines the risk premium/discount that US-based investors
demand due to government opacity or lack of transparency
✔✔Foreign Corrupt Practices Act (1977) - ✔✔a law that makes it a crime for U.S.
corporations to bribe an official of a foreign government or political party to obtain or
retain business
✔✔CAGE - ✔✔Cultural
Administrative
Geographic
Economic
✔✔Gross National Income (GNI) - ✔✔consists of GDP plus the net income earned from
investments abroad
✔✔Purchasing Power Parity (PPP) - ✔✔An adjustment in gross domestic product per
capita to reflect differences in the cost of living
✔✔HDI (Human Development Index) - ✔✔based on life expectancy, education
attainment, and whether average incomes are sufficient to meet the basic needs of life
in a country
✔✔Microfinance - ✔✔Scheme for providing very small loans (typically $15 - $4,300) to
micro-entrepreneurs
, ✔✔Dell Theory - ✔✔argues that no two countries that are both part of the same global
supply chain will ever fight a war as long as they are each part of that supply chain
✔✔Cross-Cultural Literacy - ✔✔understanding how the cultures of a country affects the
way business is practiced
✔✔Hofstede's Cultural Dimensions - ✔✔power distance, individualism, masculinity,
uncertainty avoidance, long-term orientation
✔✔ Globalization - ✔✔trend away from distinct natural economic units and toward one
huge global market
✔✔Globalization of Markets - ✔✔trend moving away from distinct national markets,
toward a system where national markets are moving towards one global market
✔✔Globalization of Production - ✔✔trend by firms to disperse parts of their production
process across the globe to minimize costs and maximize quality
✔✔Factors of Production - ✔✔inputs into the productive process of a firm including
labor, management, land, capital, and technological know-how
✔✔IMF - ✔✔maintain order in the international monetary system
✔✔World Bank - ✔✔promote economic development
✔✔United Nations - ✔✔int. organization of 193 countries est. 1943, HQ in NYC,
promotes peace, security, and cooperation
✔✔International Trade - ✔✔occurs when a firm exports goods or services to consumers
in another country
✔✔Multinational corporation - ✔✔a firm that owns business operations in more than one
country
✔✔FDI Foreign Direct Investment - ✔✔A firm invests directly in production or other
facilities over which it has effective control (multinational enterprises) ÷ In the US and
France, control means at least 10% ownership ÷ In Germany and the UK, control
means at least 20% ownership
✔✔G20 - ✔✔20 largest economies in the world
✔✔Moore's Law - ✔✔The power of the microprocessor doubles and costs of production
fall 50% every 18 months
QUESTIONS SET A+
✔✔Liberalized market economies - ✔✔Coordination occurs primarily through market
mechanism
✔✔Coordinated market economies - ✔✔Formal institutions play central role in
coordinating relationships
✔✔Opacity Index - ✔✔Determines the risk premium/discount that US-based investors
demand due to government opacity or lack of transparency
✔✔Foreign Corrupt Practices Act (1977) - ✔✔a law that makes it a crime for U.S.
corporations to bribe an official of a foreign government or political party to obtain or
retain business
✔✔CAGE - ✔✔Cultural
Administrative
Geographic
Economic
✔✔Gross National Income (GNI) - ✔✔consists of GDP plus the net income earned from
investments abroad
✔✔Purchasing Power Parity (PPP) - ✔✔An adjustment in gross domestic product per
capita to reflect differences in the cost of living
✔✔HDI (Human Development Index) - ✔✔based on life expectancy, education
attainment, and whether average incomes are sufficient to meet the basic needs of life
in a country
✔✔Microfinance - ✔✔Scheme for providing very small loans (typically $15 - $4,300) to
micro-entrepreneurs
, ✔✔Dell Theory - ✔✔argues that no two countries that are both part of the same global
supply chain will ever fight a war as long as they are each part of that supply chain
✔✔Cross-Cultural Literacy - ✔✔understanding how the cultures of a country affects the
way business is practiced
✔✔Hofstede's Cultural Dimensions - ✔✔power distance, individualism, masculinity,
uncertainty avoidance, long-term orientation
✔✔ Globalization - ✔✔trend away from distinct natural economic units and toward one
huge global market
✔✔Globalization of Markets - ✔✔trend moving away from distinct national markets,
toward a system where national markets are moving towards one global market
✔✔Globalization of Production - ✔✔trend by firms to disperse parts of their production
process across the globe to minimize costs and maximize quality
✔✔Factors of Production - ✔✔inputs into the productive process of a firm including
labor, management, land, capital, and technological know-how
✔✔IMF - ✔✔maintain order in the international monetary system
✔✔World Bank - ✔✔promote economic development
✔✔United Nations - ✔✔int. organization of 193 countries est. 1943, HQ in NYC,
promotes peace, security, and cooperation
✔✔International Trade - ✔✔occurs when a firm exports goods or services to consumers
in another country
✔✔Multinational corporation - ✔✔a firm that owns business operations in more than one
country
✔✔FDI Foreign Direct Investment - ✔✔A firm invests directly in production or other
facilities over which it has effective control (multinational enterprises) ÷ In the US and
France, control means at least 10% ownership ÷ In Germany and the UK, control
means at least 20% ownership
✔✔G20 - ✔✔20 largest economies in the world
✔✔Moore's Law - ✔✔The power of the microprocessor doubles and costs of production
fall 50% every 18 months
