WGU C211 - GLOBAL ECONOMICS FOR
MANAGERS EXAM QUESTIONS AND
ANSWERS GRADED A+ 2025/2026
Views on Globalization - ANS New, Evolutionary, and Pendulum
"New" view on globalization - ANS A force sweeping through the world in recent times.
"Evolutionary" view on globalization - ANS A long-run historical evolution since the dawn of
human history
"Pendulum" view on globalization - ANS One that swings from one extreme to another from
time to time
Foreign Direct Investment - ANS Direct investment in, control, and management of value-
added activities in other countries
Political views on FDI - ANS Radical View, Free Market View, Pragmatic Nationalism
Benefits to a country receiving FDI - ANS Capital Inflow, Technology Spillover, Advanced
Management Know-How, Job creation
Costs to a country receiving FDI - ANS Loss of Sovereignty, Adverse effects on competition,
Capital outflow.
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,How do resources and capabilities influence the competitive dynamics of a business? -
ANS Resource similarity and market commonality can yield a powerful framework for
competitor analysis.
Resource similarity - ANS The extent to which a given competitor possesses strategic
endowment comparable, in terms of both type and amount, to those of the focal firm.
How does resource similarity impact competitive dynamics? - ANS Firms with a high degree
are likely to have similar competitive actions. (Starbuck's instant coffee & McDonald's iced
coffee)
Classical theories of international trade - ANS Mercantilism, Absolute advantage, and
Comparative advantage
Modern theory view - ANS Dynamic
Classical theory view - ANS Static
Absolute advantage - ANS The economic advantage one nation enjoys that is superior to
other nations
Comparative advantage - ANS The advantage one economic activity nation enjoys in
comparison with other nations (relative, not absolute)
Mercantilism - ANS A theory that suggests that the wealth of the world is fixed and that a
nation that exports more and imports less will be richer.
Features of the product life cycle? - ANS New, Maturing, and Standardized
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Strategic trade - ANS Intervention by governments in certain industries can enhance their
odds for international success.
How are supply and demand related to the exchange rate of a country? - ANS The price of a
commodity, a country's currency, is fundamentally determined by this. Strong demand leads to
price hikes; oversupply results in price drops.
Which theory came first? - ANS Mercantilism (although both are of the idea that
governments should actively protect domestic industries from imports and vigorously promote
exports)
If a company seeks to limit foreign exchange rate exposure in the forward direction, what is the
most effective way to do this? - ANS Forward transactions, an act know as currency hedging.
Transaction risk - ANS The exchange rate risk associated with the time delay between
entering into a contract and settling it.
Hedging - ANS A transaction, such as forward transactions, that protects traders and
investors from exposure to the fluctuations of the spot rate.
Currency hedging - ANS A way to protect traders and investors from being exposed to the
fluctuations of the spot rate
Strategic hedging - ANS A means of spreading out activities in different currency zones in
order to offset the currency losses in certain regions through gains in other regions (currency
diversification)
First mover advantages - ANS Proprietary, technological leadership, pre-emption of scarce
resources, establishment of entry barriers to late entrants, avoidance of clash with dominant
firms at home, relationships with key stakeholders, (such as governments.)
Late mover advantages - ANS Opportunity to free ride on first-mover investments, Resolution
of technological and market uncertainty, First mover's difficulty to adapt to market changes.)
3 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
MANAGERS EXAM QUESTIONS AND
ANSWERS GRADED A+ 2025/2026
Views on Globalization - ANS New, Evolutionary, and Pendulum
"New" view on globalization - ANS A force sweeping through the world in recent times.
"Evolutionary" view on globalization - ANS A long-run historical evolution since the dawn of
human history
"Pendulum" view on globalization - ANS One that swings from one extreme to another from
time to time
Foreign Direct Investment - ANS Direct investment in, control, and management of value-
added activities in other countries
Political views on FDI - ANS Radical View, Free Market View, Pragmatic Nationalism
Benefits to a country receiving FDI - ANS Capital Inflow, Technology Spillover, Advanced
Management Know-How, Job creation
Costs to a country receiving FDI - ANS Loss of Sovereignty, Adverse effects on competition,
Capital outflow.
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,How do resources and capabilities influence the competitive dynamics of a business? -
ANS Resource similarity and market commonality can yield a powerful framework for
competitor analysis.
Resource similarity - ANS The extent to which a given competitor possesses strategic
endowment comparable, in terms of both type and amount, to those of the focal firm.
How does resource similarity impact competitive dynamics? - ANS Firms with a high degree
are likely to have similar competitive actions. (Starbuck's instant coffee & McDonald's iced
coffee)
Classical theories of international trade - ANS Mercantilism, Absolute advantage, and
Comparative advantage
Modern theory view - ANS Dynamic
Classical theory view - ANS Static
Absolute advantage - ANS The economic advantage one nation enjoys that is superior to
other nations
Comparative advantage - ANS The advantage one economic activity nation enjoys in
comparison with other nations (relative, not absolute)
Mercantilism - ANS A theory that suggests that the wealth of the world is fixed and that a
nation that exports more and imports less will be richer.
Features of the product life cycle? - ANS New, Maturing, and Standardized
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Strategic trade - ANS Intervention by governments in certain industries can enhance their
odds for international success.
How are supply and demand related to the exchange rate of a country? - ANS The price of a
commodity, a country's currency, is fundamentally determined by this. Strong demand leads to
price hikes; oversupply results in price drops.
Which theory came first? - ANS Mercantilism (although both are of the idea that
governments should actively protect domestic industries from imports and vigorously promote
exports)
If a company seeks to limit foreign exchange rate exposure in the forward direction, what is the
most effective way to do this? - ANS Forward transactions, an act know as currency hedging.
Transaction risk - ANS The exchange rate risk associated with the time delay between
entering into a contract and settling it.
Hedging - ANS A transaction, such as forward transactions, that protects traders and
investors from exposure to the fluctuations of the spot rate.
Currency hedging - ANS A way to protect traders and investors from being exposed to the
fluctuations of the spot rate
Strategic hedging - ANS A means of spreading out activities in different currency zones in
order to offset the currency losses in certain regions through gains in other regions (currency
diversification)
First mover advantages - ANS Proprietary, technological leadership, pre-emption of scarce
resources, establishment of entry barriers to late entrants, avoidance of clash with dominant
firms at home, relationships with key stakeholders, (such as governments.)
Late mover advantages - ANS Opportunity to free ride on first-mover investments, Resolution
of technological and market uncertainty, First mover's difficulty to adapt to market changes.)
3 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
