D080 UNIT 2 TEST QUESTIONS & ANSWERS
Which effect does a command economy have on the process of globalization? -
Answer -The government is less flexible, so the globalization process is challenged.
A company is conducting a legal risk analysis for a country that has a civil law system.
Which statement accurately characterizes this legal system? - Answer -It is based on a
detailed set of laws that form a code.
Which fact should a company opening its operations in the U.S. state of Louisiana note?
- Answer -The state has a mixed law system.
Which core principle of the World Trade Organization supports equality among member
nations and helps fight discrimination among them? - Answer -Most-favored-nation
(MFN) status
What is true regarding free trade? - Answer -Free trade leads to specialization of each
country and increases production efficiency.
Countries A and B participate in trade agreements that allow free trade among
participant countries. However, Country A imposed quotas on several imported products
to protect its domestic products.
What is the effect, if any, on the domestic prices of these products? - Answer -
Increases
How do governments help companies offset the cost of manufacturing domestically? -
Answer -Subsidies
What would a mercantilist value the most? - Answer -A trade surplus
A multinational corporation has manufacturing facilities in many Asian countries due to
cheaper labor. Which strategy is the corporation using? - Answer -Acquisition of
resources
A business operating globally wants to increase its overall production efficiency. Which
strategy should the business use? - Answer -Focus on specialization
The German government has imposed a specific tariff on T-shirts imported from
Cambodia. How does this specific tariff affect the T-shirt producers in Germany? -
Answer -It protects German T-shirt producers.
Countries A, B, and C have a trade agreement. Country C imposes high tariffs on all
raw materials imported from Country A, and Country B imposes a lower tariff on the
same raw materials imported from country A. What is the effect of this set of actions on
these countries - Answer -Country A will do more business with Country B.
Which effect does a command economy have on the process of globalization? -
Answer -The government is less flexible, so the globalization process is challenged.
A company is conducting a legal risk analysis for a country that has a civil law system.
Which statement accurately characterizes this legal system? - Answer -It is based on a
detailed set of laws that form a code.
Which fact should a company opening its operations in the U.S. state of Louisiana note?
- Answer -The state has a mixed law system.
Which core principle of the World Trade Organization supports equality among member
nations and helps fight discrimination among them? - Answer -Most-favored-nation
(MFN) status
What is true regarding free trade? - Answer -Free trade leads to specialization of each
country and increases production efficiency.
Countries A and B participate in trade agreements that allow free trade among
participant countries. However, Country A imposed quotas on several imported products
to protect its domestic products.
What is the effect, if any, on the domestic prices of these products? - Answer -
Increases
How do governments help companies offset the cost of manufacturing domestically? -
Answer -Subsidies
What would a mercantilist value the most? - Answer -A trade surplus
A multinational corporation has manufacturing facilities in many Asian countries due to
cheaper labor. Which strategy is the corporation using? - Answer -Acquisition of
resources
A business operating globally wants to increase its overall production efficiency. Which
strategy should the business use? - Answer -Focus on specialization
The German government has imposed a specific tariff on T-shirts imported from
Cambodia. How does this specific tariff affect the T-shirt producers in Germany? -
Answer -It protects German T-shirt producers.
Countries A, B, and C have a trade agreement. Country C imposes high tariffs on all
raw materials imported from Country A, and Country B imposes a lower tariff on the
same raw materials imported from country A. What is the effect of this set of actions on
these countries - Answer -Country A will do more business with Country B.
