C211 Second OA quizzes Exam with 100% Correct Answers 2023

The term "emerging economies" has replaced the term _____. - Correct answerDeveloping countries The gross domestic product plus the income from non-resident sources abroad gives the ____. - Correct answer-gross national product More than 25% of global GDP comes from _____. - Correct answer-BRICS countries Viewing the global economy as a pyramid, the Triad refers to _____. - Correct answerNorth America, Western Europe, and Japan People who earn _____ a year comprise the base of the global economic pyramid. - Correct answer-less than $2,000 Which of the following would be an example of a top down innovation? - Correct answer-Lowering prices and features of existing products to meet emerging market needs Which of the following is true of the Group of 20 (G-20)? - Correct answer-It only has 19 member countries. Which of the following does the institution-based view of global business lay emphasis on? - Correct answer-Understanding the laws and values of the firm's host nation. The resource-based view of global business differs from the institution-based view of global business in that the resource-based view _____. - Correct answer-focuses on the internal strengths on the firm The liability of foreignness is the inherent disadvantage faced by _____. - Correct answer-foreign firms in host nations due to their non-native status Which of the following is true of globalization according to the "new force" perspective? - Correct answer-It is a western ideology focused on exploiting and dominating the world through MNEs The concept of _____ suggests that barriers to market integration at borders are high, but not high enough to completely insulate countries from each other. - Correct answerSemiglobalization The strategy of treating each country as a unique market and in total isolation is referred to as _____. - Correct answer-Localization MNEs from the Triad dominate the list of the 500 largest MNEs; their share has been _____. - Correct answer-Shrinking A conversion that determines the equivalent amount of goods and services that different currencies can buy is known as _____. - Correct answer-purchasing power parity Which of the following countries would be characterized as an emerging economy? - Correct answer-Brazil Which of the following countries is represented in the Triad of the global economic pyramid? - Correct answer-Japan People who earn _____ a year comprise the base of the global economic pyramid. - Correct answer-less than $2,000 A _____ is defined as an innovation that is adopted first in emerging economies and then diffused around the world. - Correct answer-reverse innovation The _____ view suggests that the success and failure of firms are largely determined by their environments. - Correct answer-institution-based The _____ view of global business focuses on internal factors that can help a firm overcome its external environment. - Correct answer-resource-based Which of the following is true of globalization according to the "pendulum view" perspective? - Correct answer-Globalization is a not a one-directional phenomenon The concept of _____ suggests that barriers to market integration at borders are high, but not high enough to completely insulate countries from each other. - Correct answersemiglobalization _____ is the strategy of treating the entire world as one market. - Correct answerStandardization Protectionism is similar to mercantilism as they both advocated _____. - Correct answer-government involvement in international trade The _____ principle advocated that governments should actively protect domestic industries from imports and vigorously promote exports. - Correct answer-Protectionism Which of the following is a modern trade theory? - Correct answer-National competitive advantage Which of the following trade theories divides the nations of the world into three categories? - Correct answer-Product life cycle Which of the following was the first international trade theory to account for changes in the patterns of trade over time? - Correct answer-Product life cycle theory In the third stage of the product life cycle theory, the _____. - Correct answer-product is standardized Which of the following describes resource mobility as assumed by the classical theories of international trade? - Correct answer-It is the assumption that a resource used in producing a product for one industry can be shifted and put to use in another industry The theory of comparative advantage _____. - Correct answer-explains patterns of trade based on factor endowments Deadweight costs are net losses that occur when _____ are imposed. - Correct answerimport tariffs _____ are government payments to domestic firms. - Correct answer-Subsidies Which of the following is true of voluntary export restraints? - Correct answer-It is an export quota levied by a country on the quantity of its exports. _____ are tariffs levied on imports sold below costs to drive domestic firms out of business. - Correct answer-Antidumping duties FPI refers to the _____. - Correct answer-investment in a portfolio of foreign securities that do not entail the active management of foreign assets A vertical FDI refers to a type of FDI in which _____. - Correct answer-a firm moves upstream or downstream at different value chain stages in a host country _____ refers to the total accumulation of inbound FDI in a country or outbound FDI from a country. - Correct answer-FDI stock OLI advantages refer to a firm's quest for _____via FDI. - Correct answer-ownership advantages, location advantages, and internalization advantages ____ refers to the replacement of cross-border markets with one firm locating in two or more countries. - Correct answer-Internalization Firms prefer FDI to licensing because FDI_____. - Correct answer-provides the firm with direct ownership to its foreign assets _____ refers to the clustering of economic activities in certain locations. - Correct answer-Agglomeration The television industry in the United States is controlled by seven giant corporations: The Walt Disney Company, CBS Corporation, Viacom, Comcast, Hearst Corporation, Time Warner, and News Corporation. Thus, the television industry in the U.S. is a typical _____ industry. - Correct answer-Oligopolistic Which of the following economic perspectives on FDI has its principles rooted in Marxism? - Correct answer-The radical view Which of the following is a benefit of FDI to home countries? - Correct answer-Learning from operations _____ refers to the deal struck by MNEs and host governments, which change their requirements after the initial FDI entry. - Correct answer-Obsolescing bargain Costs that a firm has to endure even when its investment turns out to be unsatisfactory are referred to as _____. - Correct answer-sunk costs A _____ is the price of one currency, such as the dollar, in terms of another, such as the euro. - Correct answer-foreign exchange rate Which of the following conditions will attract foreign funds into a country? - Correct answer-If the country's interest rate is relatively high compared to other countries _____ is a country's international transaction statement, which includes merchandise trade, service trade, and capital movement. - Correct answer-Balance of payments Which of the following types of exchange rate policies is apt for a pure free market economy? - Correct answer-Clean float The fixing of East and West Germany's currencies at a 1:1 ratio to each other during the German unification in 1990 is an example of a _____. - Correct answer-fixed exchange rate policy In foreign exchange, a(n) _____ is said to have occurred when investors move in the same direction at the same time, like a herd. - Correct answer-bandwagon effect Between 1870 and 1914, the value of most major currencies was maintained by fixing their prices in terms of _____. - Correct answer-Gold Which of the following was true of the Bretton Woods system? - Correct answer-All currencies were pegged at a fixed rate to the dollar. The weight a member country carries within the IMF, which determines the amount of its financial contribution, its capacity to borrow from the IMF, and its voting power is referred to as a(n) _____. - Correct answer-Quota _____ allow participants to buy and sell currencies now for future delivery. - Correct answer-Forward transactions _____ is defined as the conversion of one currency into another at Time 1, with an agreement to revert it back to the original currency at a specific Time 2 in the future. - Correct answer-Currency swap ___ refers to non-financial companies spreading out its activities in different currency zones in order to offset the currency losses in certain regions through gains in other regions. - Correct answer-Strategic hedging A currency board is a monetary authority that issues notes and coins convertible into a key foreign currency at a _____ exchange rate. - Correct answer-Fixed A manager arguing against currency hedging would most likely argue that _____. - Correct answer-currency hedging eats into company profits Liability of foreignness is _____. - Correct answer-the inherent disadvantage foreign firms experience in host countries Which of the following conforms to the notion put forward by the school of thought associated with stage models? - Correct answer-Firms enter culturally distant countries in later stages when they may gain more confidence Which of the following is a first-mover advantage? - Correct answer-Avoidance of clash with a dominant firm at home ____ refers to the amount of resources committed to entering a foreign market. - Correct answer-Scale of entry The distinction between _____ is what defines an MNE from a firm that merely exports or imports. - Correct answer-equity and non-equity modes of entry Which of the following is a non-equity mode of entry? - Correct answer-Turnkey projects Which of the following entry modes is a type of strategic alliance? - Correct answerLicensing Which of the following is an advantage of R&D contracts? - Correct answer-Ability to tap into the best, cost-effective locations Which of the following is true of indirect exports? - Correct answer-They export through domestically based export intermediaries. A(n) _____ is a non-equity mode of entry used to build a longer-term presence by building and then operating a facility for a period of time before transferring operations to a domestic agency or firm. - Correct answer-BOT agreement Greenfield operations are similar to acquisitions in that they are both examples of _____. - Correct answer-wholly owned subsidiaries The country-of-origin effect refers to _____. - Correct answer-the positive or negative perception of firms and products from a certain country The process of anticipating rivals' actions in order to both revise a firm's plan and prepare to deal with rivals' response is called _____. - Correct answer-competitor analysis ___ occurs when firms engage the same rivals in numerous markets. - Correct answerMultimarket competition Which of the following industry characteristics contributes to collusion? - Correct answer-Existence of an industry price leader Which of the following is defined as the degree of overlap between two rivals' markets? - Correct answer-Market commonality __ is an attack on a competitor's other markets if this competitor attacks a firm's original market. - Correct answer-Cross-market retaliation The act of setting prices below cost to eliminate rivals while intending to raise them in the long run to make up for the initial losses is known as _____. - Correct answerpredatory pricing A _____ antirust policy would protect established firms that have already invested and nurtured an industry from new entrants. - Correct answer-pro-incumben Which combination of resource similarity and market commonality results in the most intense competition? - Correct answer-High resource similarity, low market commonality Which of the following sets of words describes the initial set of actions a firm uses to gain competitive advantage and the other firm's response to it? - Correct answer-Attack, counterattack ___ best suits situations where the pressures to globalize are relatively low, and local firms' strengths lie in a deep understanding of local markets. - Correct answer-Defender strategy If a firm is operating in an environment that is customized to home market, which of the following is the most preferred strategy? - Correct answer-Dodger strategy If a seller in a competitive market chooses to charge more than the going price, then. - Correct answer-buyers will make purchases from other sellers An increase in the price of a good will. - Correct answer-decrease quantity demanded. Which of the following demonstrates the law of demand? - Correct answer-Jayden buys more donuts at $0.25 per donut than at $0.50 per donut, other things equal. The line that relates the price of a good and the quantity demanded of that good is called the demand. - Correct answer-curve, and it usually slopes downward. If the demand for a good falls when income falls, then the good is called. - Correct answer-a normal good Currently you purchase ten frozen pizza per month. You will graduate from college in December, and you will start a new job in January. You have no plans to purchase frozen pizzas in January. For you, frozen pizzas are. - Correct answer-an inferior good Two goods are complements when a decrease in the price of one good. - Correct answer-increases the demand for the other good. Suppose scientists provide evidence that people who drink energy drinks are more likely to have a heart attack than people who do not drink energy drinks. We would expect to see. - Correct answer-a decrease in the demand for energy drinks The shift from Da to Db is called. - Correct answer-an increase in demand The law of supply states that, other things equal, when the price of a good. - Correct answer-rises, the quantity supplied of the good rises The movement from point A to point B on the graph is called. - Correct answer-an increase in the quantity supplied Which of the following changes would not shift the supply curve for a good or service? - Correct answer-A change in the price of the good or service A improvement in production technology will shift the. - Correct answer-supply curve to the right. Which of the following events could cause an increase in the supply of ceiling fans? - Correct answer-The number of sellers of ceiling fans increases. Equilibrium quantity must decrease when demand. - Correct answer-decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease Which of the following would not increase in response to a decrease in the price of ironing boards? - Correct answer-The quantity of irons supplied at each possible price of irons For a particular good, a 2 percent increase in price causes a 12 percent decrease in quantity demanded. Which of the following statements is most likely applicable to this good? - Correct answer-The good is a luxury Using the midpoint method, if the price falls from $200 to $150, the price elasticity of demand is. - Correct answer-elastic Suppose demand is perfectly elastic, and the supply of the good in question decreases. As a result, - Correct answer-the equilibrium quantity decreases, and the equilibrium price is unchanged. If the demand for donuts is elastic, then a decrease in the price of donuts will - Correct answer-increase total revenue of donut sellers Using the midpoint method, between prices of $20 and $30, price elasticity of demand is about. - Correct answer-0.33 For which of the following goods is the income elasticity of demand likely highest? - Correct answer-Diamonds You and your college roommate eat three packages of Ramen noodles each week. After graduation last month, both of you were hired at several times your college income. You still enjoy Ramen noodles very much and buy even more, but your roommate plans to buy fewer Ramen noodles in favor of foods she prefers more. When looking at income elasticity of demand for Ramen noodles, yours would. - Correct answer-be positive, and your roommate's would be negative If the cross-price elasticity of two goods is negative, then the two goods are. - Correct answer-Complements Using the midpoint method, if the price of good X is constant at $10 and the price of good Y decreases from $10 to $8, the cross-price elasticity of demand is about - Correct answer-−2.57, and X and Y are complements Suppose that two supply curves pass through the same point. One is steep, and the other is flat. Which of the following statements is correct? - Correct answer-The steeper supply curve represents a supply that is inelastic relative to the supply represented by the flatter supply curve. Suppose the price elasticity of supply for cheese is 0.6 in the short run and 1.4 in the long run. If an increase in the demand for cheese causes the price of cheese to