Global Business Today Global 8th Edition Hill Test Bank
Answers are at the end of each chapter
Chapter 01 Globalization
True / False Questions
1. As a result of globalization, we have been moving toward a world in which national economies
are relatively self-contained entities.
True False
2. By offering the same basic product worldwide, firms help to create a global market.
True False
3. A company has to be the size of a multinational giant to facilitate, and benefit from, the
globalization of markets.
True False
4. As a result of globalization, companies rarely need to customize marketing strategies, product
features, and operating practices in different countries.
True False
5. Globalization has resulted in greater uniformity replacing diversity across national markets.
True False
6. As firms follow each other around the world, they bring with them many of the assets that
served them well in other national markets. Thus, greater diversity replaces uniformity.
True False
7. Substantial impediments, such as barriers to foreign direct investment, make it difficult for firms
to achieve the optimal dispersion of their productive activities to locations around the globe.
True False
8. The World Trade Organization, the International Monetary Fund and its sister institution the
World Bank, and the United Nations were all created by voluntary agreement between individual
nation- states.
True False
,9. The International Monetary Fund and the World Bank were both created in 1944 by 44 nations
that met at Bretton Woods, New Hampshire.
True False
10. The WTO is seen as the lender of last resort to nation-states whose economies are in turmoil
and whose currencies are losing value against those of other nations.
True False
11. The IMF is less controversial than its sister institution, the World Bank.
True False
12. In return for loans, the IMF requires nation-states to adopt specific economic policies aimed at
returning their troubled economies to stability and growth.
True False
13. Foreign direct investment (FDI) occurs when a firm invests resources in business activities
outside its home country.
True False
14. After World War II, the advanced nations of the West committed themselves to increasing
barriers to the free flow of goods, services, and capital between nations.
True False
15. The Uruguay Round, held under the umbrella of GATT, extended GATT to cover services as well
as manufactured goods.
True False
16. The lowering of trade and investment barriers allows firms to base production at the optimal
location for that activity.
True False
17. As a result of international trade, the economies of the world’s nation-states are becoming less
intertwined.
True False
18. The globalization of markets and production and the resulting growth of world trade, foreign
direct investment, and imports all imply that firms are finding it easier to protect themselves from
the attack of foreign competitors.
,True False
19. Containerization has revolutionized the transportation business, significantly lowering the costs
of shipping goods over long distances.
True False
20. While advances in telecommunications are creating a global audience, advances in
transportation are creating a global village.
True False
21. The real costs of information processing and communication have fallen dramatically in the past
two decades.
True False
22. The Internet has been a major force facilitating international trade in services.
True False
23. Countries that markedly increased their share of world output from 1960 to 2010 included
Germany, France, and the United Kingdom.
True False
24. The United States accounted for a significantly larger share of the world economy in 2011 than it
did in the 1960's.
True False
25. Beginning in the 1970s, European and Japanese firms began to shift labor-intensive
manufacturing operations from developing nations to their home countries where labor costs were
lower.
True False
26. The stock of foreign direct investment refers to the total cumulative value of foreign
investments in a country.
True False
27. Throughout the 1990s, the amount of investment directed at both developed and developing
nations increased dramatically
True False
, 28. Among developing nations, the largest recipient of foreign direct investment has been China.
True False
29. Although most international trade and investment is still conducted by large firms, many
medium- size and small businesses are becoming increasingly involved in international trade and
investment.
True False
30. The rise of the Internet is increasing the barriers that small firms face in building international
sales.
True False
31. Many of the former Communist nations of Europe and Asia seem to share a commitment to
democratic policies and free market economies.
True False
32. In the past quarter century, the volume of cross-border trade and investment has been growing
less rapidly than global output.
True False
33. One concern frequently voiced by globalization opponents is that falling barriers to international
trade destroy manufacturing jobs in wealthy advanced economies such as the United States and
western Europe.
True False
34. It is possible that economic growth in developed nations has offset the fall in the share of
national income enjoyed by unskilled workers, raising their living standards.
True False
35. One concern of globalization opponents is that it undermines the influence of supranational
organizations and promotes the sovereignty of individual nation-states.
True False
36. In general, as countries get richer, they enact tougher environmental and labor regulations.
Answers are at the end of each chapter
Chapter 01 Globalization
True / False Questions
1. As a result of globalization, we have been moving toward a world in which national economies
are relatively self-contained entities.
True False
2. By offering the same basic product worldwide, firms help to create a global market.
True False
3. A company has to be the size of a multinational giant to facilitate, and benefit from, the
globalization of markets.
True False
4. As a result of globalization, companies rarely need to customize marketing strategies, product
features, and operating practices in different countries.
True False
5. Globalization has resulted in greater uniformity replacing diversity across national markets.
True False
6. As firms follow each other around the world, they bring with them many of the assets that
served them well in other national markets. Thus, greater diversity replaces uniformity.
True False
7. Substantial impediments, such as barriers to foreign direct investment, make it difficult for firms
to achieve the optimal dispersion of their productive activities to locations around the globe.
True False
8. The World Trade Organization, the International Monetary Fund and its sister institution the
World Bank, and the United Nations were all created by voluntary agreement between individual
nation- states.
True False
,9. The International Monetary Fund and the World Bank were both created in 1944 by 44 nations
that met at Bretton Woods, New Hampshire.
True False
10. The WTO is seen as the lender of last resort to nation-states whose economies are in turmoil
and whose currencies are losing value against those of other nations.
True False
11. The IMF is less controversial than its sister institution, the World Bank.
True False
12. In return for loans, the IMF requires nation-states to adopt specific economic policies aimed at
returning their troubled economies to stability and growth.
True False
13. Foreign direct investment (FDI) occurs when a firm invests resources in business activities
outside its home country.
True False
14. After World War II, the advanced nations of the West committed themselves to increasing
barriers to the free flow of goods, services, and capital between nations.
True False
15. The Uruguay Round, held under the umbrella of GATT, extended GATT to cover services as well
as manufactured goods.
True False
16. The lowering of trade and investment barriers allows firms to base production at the optimal
location for that activity.
True False
17. As a result of international trade, the economies of the world’s nation-states are becoming less
intertwined.
True False
18. The globalization of markets and production and the resulting growth of world trade, foreign
direct investment, and imports all imply that firms are finding it easier to protect themselves from
the attack of foreign competitors.
,True False
19. Containerization has revolutionized the transportation business, significantly lowering the costs
of shipping goods over long distances.
True False
20. While advances in telecommunications are creating a global audience, advances in
transportation are creating a global village.
True False
21. The real costs of information processing and communication have fallen dramatically in the past
two decades.
True False
22. The Internet has been a major force facilitating international trade in services.
True False
23. Countries that markedly increased their share of world output from 1960 to 2010 included
Germany, France, and the United Kingdom.
True False
24. The United States accounted for a significantly larger share of the world economy in 2011 than it
did in the 1960's.
True False
25. Beginning in the 1970s, European and Japanese firms began to shift labor-intensive
manufacturing operations from developing nations to their home countries where labor costs were
lower.
True False
26. The stock of foreign direct investment refers to the total cumulative value of foreign
investments in a country.
True False
27. Throughout the 1990s, the amount of investment directed at both developed and developing
nations increased dramatically
True False
, 28. Among developing nations, the largest recipient of foreign direct investment has been China.
True False
29. Although most international trade and investment is still conducted by large firms, many
medium- size and small businesses are becoming increasingly involved in international trade and
investment.
True False
30. The rise of the Internet is increasing the barriers that small firms face in building international
sales.
True False
31. Many of the former Communist nations of Europe and Asia seem to share a commitment to
democratic policies and free market economies.
True False
32. In the past quarter century, the volume of cross-border trade and investment has been growing
less rapidly than global output.
True False
33. One concern frequently voiced by globalization opponents is that falling barriers to international
trade destroy manufacturing jobs in wealthy advanced economies such as the United States and
western Europe.
True False
34. It is possible that economic growth in developed nations has offset the fall in the share of
national income enjoyed by unskilled workers, raising their living standards.
True False
35. One concern of globalization opponents is that it undermines the influence of supranational
organizations and promotes the sovereignty of individual nation-states.
True False
36. In general, as countries get richer, they enact tougher environmental and labor regulations.
