WGU D080 Unit 2-6 Tests Questions with Verified
Answers
A business has decided to engage in foreign direct investment (FDI).
Which reason should influence the business to take this step?
A. To establish business policy in the host country
B. To increase economic development in the host country
C. To take advantage of lower costs in the host country
D. To create a political alliance with the host country Ans✓✓✓ C-Global
businesses engage in foreign direct investment (FDI) to take advantage of lower
costs in the host country.
A business has recently started selling in a new global marketplace. Shortly after
the company made this global expansion, the new country opted to implement ad
valorem tariffs. How will this change affect the company?
A. It will impose a value-added tax on corporate profits.
B. It will levy a tax based on the value of goods imported, causing this company to
export less.
C. It will provide increased corporate tax breaks.
D. It will levy a fixed tax on the goods imported. Ans✓✓✓ ?
A business operating globally wants to increase its overall production efficiency.
Which strategy should the business use?
A. Enhance international relationships
,B. Improve trade regulations
C. Maximize labor force
D. Focus on specialization Ans✓✓✓ D-When a business adds technology to its
process, it allows the business to maximize economies of scale.
A car manufacturing company manufacturers tires in Countries A, B, and C.
Country A has significant political turmoil that has resulted in a lengthy labor
strike. Countries B and C have ramped up production resulting in sustained tire
production for the company.
Which practice has the company used to optimize its production efficiency?
A. Multinational production
B. Linear and sequential
C. Just-in-time
D. Lean manufacturing Ans✓✓✓ A-There are three countries producing the same
tires. If something like a strike occurs in one, the others can ramp up their
production.
A chief executive officer (CEO) wants to grow the company by investing in foreign
countries. The CEO is considering multiple entry strategies to accomplish this
objective but has concerns about growth in foreign markets, especially the costs,
risks, and entry time. The CEO would like to eliminate any entry strategies that
take a long time, as well as any that contain high cost and risk. Which strategy
should this CEO eliminate?
A. Franchising
B. Licensing
C. Exporting
,D. Greenfield venture Ans✓✓✓ D-Disadvantages of a Greenfield venture include
high costs, high risk, and slow entry time.
A company based in the Philippines is attempting to develop world-class digital
infrastructure to facilitate business and commerce in its country.
Which country in the Southeast Asia region should the company use to
benchmark its progress?
A. Vietnam
B. Singapore
C. Malaysia
D. Indonesia Ans✓✓✓ B-As per a recent study, Singapore was categorized as
having the stand-out digital evolution in the region. This allows all other countries
in the region, including the Philippines, to benchmark their progress to Singapore.
A company desires to scale its international business by taking over established
organizations in the intended markets.
Which strategy will allow this process to occur quickly?
A. Franchising
B. Acquisition
C. International joint venture
D. Licensing Ans✓✓✓ B-Acquisitions are appealing to companies due to the
ability to quickly take over foreign assets for new market entry.
A company desires to scale its international business by taking over established
organizations in the intended markets.
, Which strategy will allow this process to occur quickly?
A. International joint venture
B. Licensing
C. Acquisition
D. Franchising Ans✓✓✓ C-Acquisitions are appealing to companies due to the
ability to have quick access to take over foreign assets for new market entry.
A company has achieved a monetary advantage by using a fronting loan with a
subsidiary in a country with a low corporate income tax rate. Which type of tax
situation in this country allows the company to achieve this monetary advantage?
Graduated tax rate
Tax haven
Consumption tax
Flat tax rate Ans✓✓✓ B-A tax haven, a country with a low tax rate, would keep
the subsidiary from paying taxes on the interest earned from the loan. This
reduces the amount of taxes in comparison to a regular corporate tax situation.
A company in the United States has encountered a financial reporting situation
that is not currently addressed by the accounting standards of the country.
How should the U.S. company proceed?
A. Consult with the FASB
B. Contact the IASB
C. Move to using IFRS
Answers
A business has decided to engage in foreign direct investment (FDI).
Which reason should influence the business to take this step?
A. To establish business policy in the host country
B. To increase economic development in the host country
C. To take advantage of lower costs in the host country
D. To create a political alliance with the host country Ans✓✓✓ C-Global
businesses engage in foreign direct investment (FDI) to take advantage of lower
costs in the host country.
A business has recently started selling in a new global marketplace. Shortly after
the company made this global expansion, the new country opted to implement ad
valorem tariffs. How will this change affect the company?
A. It will impose a value-added tax on corporate profits.
B. It will levy a tax based on the value of goods imported, causing this company to
export less.
C. It will provide increased corporate tax breaks.
D. It will levy a fixed tax on the goods imported. Ans✓✓✓ ?
A business operating globally wants to increase its overall production efficiency.
Which strategy should the business use?
A. Enhance international relationships
,B. Improve trade regulations
C. Maximize labor force
D. Focus on specialization Ans✓✓✓ D-When a business adds technology to its
process, it allows the business to maximize economies of scale.
A car manufacturing company manufacturers tires in Countries A, B, and C.
Country A has significant political turmoil that has resulted in a lengthy labor
strike. Countries B and C have ramped up production resulting in sustained tire
production for the company.
Which practice has the company used to optimize its production efficiency?
A. Multinational production
B. Linear and sequential
C. Just-in-time
D. Lean manufacturing Ans✓✓✓ A-There are three countries producing the same
tires. If something like a strike occurs in one, the others can ramp up their
production.
A chief executive officer (CEO) wants to grow the company by investing in foreign
countries. The CEO is considering multiple entry strategies to accomplish this
objective but has concerns about growth in foreign markets, especially the costs,
risks, and entry time. The CEO would like to eliminate any entry strategies that
take a long time, as well as any that contain high cost and risk. Which strategy
should this CEO eliminate?
A. Franchising
B. Licensing
C. Exporting
,D. Greenfield venture Ans✓✓✓ D-Disadvantages of a Greenfield venture include
high costs, high risk, and slow entry time.
A company based in the Philippines is attempting to develop world-class digital
infrastructure to facilitate business and commerce in its country.
Which country in the Southeast Asia region should the company use to
benchmark its progress?
A. Vietnam
B. Singapore
C. Malaysia
D. Indonesia Ans✓✓✓ B-As per a recent study, Singapore was categorized as
having the stand-out digital evolution in the region. This allows all other countries
in the region, including the Philippines, to benchmark their progress to Singapore.
A company desires to scale its international business by taking over established
organizations in the intended markets.
Which strategy will allow this process to occur quickly?
A. Franchising
B. Acquisition
C. International joint venture
D. Licensing Ans✓✓✓ B-Acquisitions are appealing to companies due to the
ability to quickly take over foreign assets for new market entry.
A company desires to scale its international business by taking over established
organizations in the intended markets.
, Which strategy will allow this process to occur quickly?
A. International joint venture
B. Licensing
C. Acquisition
D. Franchising Ans✓✓✓ C-Acquisitions are appealing to companies due to the
ability to have quick access to take over foreign assets for new market entry.
A company has achieved a monetary advantage by using a fronting loan with a
subsidiary in a country with a low corporate income tax rate. Which type of tax
situation in this country allows the company to achieve this monetary advantage?
Graduated tax rate
Tax haven
Consumption tax
Flat tax rate Ans✓✓✓ B-A tax haven, a country with a low tax rate, would keep
the subsidiary from paying taxes on the interest earned from the loan. This
reduces the amount of taxes in comparison to a regular corporate tax situation.
A company in the United States has encountered a financial reporting situation
that is not currently addressed by the accounting standards of the country.
How should the U.S. company proceed?
A. Consult with the FASB
B. Contact the IASB
C. Move to using IFRS
