WGU D080 OA Questions with Complete Solutions Graded A+

A company would like to use a human resource approach that leads to more fluid movement among employees and creates diversity in the workforce. Assignment decisions are made jointly by the headquarters and the field offices. Which human resource approach should be used by this company? - Geocentric Worldwide interconnections in virtually every sphere of activity including the spread of products, technology, information, and job opportunities. Globalization can result in blurred boundaries between nations, organizations, and investors - Globalization The action of buying and selling goods and services - trade Financial assets such as funds but also equipment, facilities, and other means of production - capital To obtain goods or services from an outside or foreign supplier - outsource Not for profit organizations that are independent of the government and are active in humanitarian causes - nongovernmental organizations (NGOs) Which type of globalization refers to the international movement of goods, capital, and services? - Economic Protects inventions and improvements to existing inventions for a limited period of time in exchange for detailed public disclosure of those inventions - patents A government authority or license giving the owner of an invention the right to exclude others from making or selling the invention for a set period of time - copyrights Protection for any word, name, symbol, device, or any combination used in commerce to identify and distinguish the goods of one manufacturer or seller from goods manufactured or sold by others - trademarks A useful or valuable thing; something you own such as building, inventory, or cash - assets Being responsible for a debt or financial obligation, something you owe - liabilities A monetary contract between parties - financial instrument A large corporation incorporated in one country which produces or sells goods or services in various countries - multinational firms 5 stages of going global - Stage 1 ~ Market Entry Stage 2 ~ Product Specialization Stage 3 ~ Value Chain Disaggregation Stage 4 ~ Value Chain Reengineering Stage 5 ~ Creation of New Markets A proportionate savings in costs gained by an increased level of production - Economies of scale To develop efficiencies in terms of variety not volume - Economies of scope A CEO seeks to better use the economies of scale and scope of production to increase the international company's profits. Which type of globalization driver is the CEO seeking to use? - Cost A CEO is discussing an expansion of production of a company's highly perishable dairy line in a country that can offer low labor costs and good internet connections. The country has no highways, and roads are poorly maintained. Which challenge to international business expansion do the road conditions present? - Infrastructure A method that provides tools for organizations to increase performance and decrease process variation - Six Sigma Which factor of CAGE addresses differences in country size that affect barriers to globalization? - Economics Measures the inequality among values of a frequency distribution such as levels of income - Gini coefficient Measures how well nations are doing at achieving long, happy, sustainable lives - Happy Planet Index Which argument is used by critics who wish to discourage movement towards globalization? - Increases the wealth of the rich and not the poor The total value of goods and services provided in a country in a one-year period - gross domestic product (GDP) The total value of goods and services provided by a country, both inside and outside of its borders, in a one-year period - gross national product (GNP) Which type of economy is decentralized and allows firms and households to participate in global trade with minimum governmental interference? - Market Which type of legal system is based on a code and focuses on how the law is applied to the facts? - Civil Which law is based on tradition and precedent given that judicial rulings can stand as precedents for future cases? - Common Which legal system can vary from community to community and is found in countries without strong formal justice systems? - Customary In which legal system does a judge decide the applicable law for the case as a jury determines the facts? - Common Based on precedence. Any activity that is not clearly illegal may be acceptable. The role of the judge is to hear arguments from both parties and make a judgment. This judgment stands as precedent for future cases. - Common law based on religious beliefs. One example is a requirement in Sharia that people following Sharia may not borrow money. To compensate for the inability to take on debt, an asset-based system has been established. - Religious law The difference in total value between payments into and out of the country over a period of time - balance of payments When a country's currency value is fixed or pegged by a monetary authority against the value of another currency, a basket of currencies, or another measure of value - fixed-rate currency exchange system ~ Encourages developing countries to borrow for development projects ~ Developmental institution ~ Financed reconstruction after wars in the 1940s. It is now focused on supporting developing countries ~ Large: 40 offices, over 10,000 staff ~ Investment bank owned by the governments of the 180 member nations ~ Borrows and loans ~ Borrowers must meet requirements to qualify for loans - World Bank ~ Oversees the international monetary system ~ Cooperative institution ~ In phase one, prior to 1973, regulated international exchange rates In phase two, post-1973, provides a means for effective international currency exchange, supervises economic policies, and provides financial assistance to members ~ Small: 2,300 staff members ~ Resources come from quota subscriptions or membership fees ~ Acts more like a credit union ~ Loans to all member nations - International Monetary Fund Which activity of the International Monetary Fund (IMF) impacts policymaking? - Being owned and directed by the governments of the member nations What is a characteristic of the International Monetary Fund (IMF)? - The IMF is a cooperative institution and provides more effective currency exchange. What was the initial purpose of the International Monetary Fund (IMF) in phase one, prior to 1973? - Regulated currency exchange between nations Selling government holdings to private companies - privatization The removal of regulations or restrictions in a particular industry - deregulation How does the International Monetary Fund (IMF) impact international organizations and governments? - It reduces funding for social programs. The highest possible rating that may be assigned by a credit rating agency for a bond - AAA ratings A tool used by a company or any other entity to raise money or capital - debt instruments What is a common name for the International Bank for Reconstruction and Development? - World Bank What was the first loan that the World Bank made after the end of World War II? - France to rebuild it's infrastructure Which criticism is associated with the World Bank? - The developed countries such as the U.S. and Europe have too much control over its decisions. It does not consider how funding projects will affect the environment. World Bank provides - low-interest loans, interest-free credits, and conditional grants to developing countries in which a government (or sovereign) guarantees repayment. The World Bank Group is comprised of - private lending banks as well as the World Bank Some criticisms of the World Bank include: - an imbalance of leadership power, enforced conditionality, and environmental impacts. 6 functions of the WTO - ~ Oversee Agreements ~ Transparency of Trade Policy ~ Assist Developing Nations ~ Provide Outreach ~ Settle Disputes ~ Ensure Non-discrimination A WTO agreement that governs all IP laws and protects intellectual property rights for global businesses. - TRIPS (Trade-Related Aspects of Intellectual Property Rights) A raw material or primary agricultural product that can be bought or sold - commodities What was one of the results of the Uruguay Round of the World Trade Organization negotiations? - Decrease in tariffs Which strategic network was established to work towards decreasing tariff rates and protecting commerce and intellectual property globally? - World Trade Organization (WTO) Which organization was formed after World War II to encourage international commerce? - World Trade Organization (WTO) Which criticism is made about the World Trade Organization (WTO)? - It protects developed countries more than developing countries. WTO reviews trade policies of... - all nations to ensure that each country is treated fairly and equally under the most favored nation requirement. Criticisms of the WTO - a lack of equal trade, ensuring adoption of labor standards and rights, and ignoring environmental concerns. An order of a government prohibiting the departure of commercial ships from its ports - embargos One of the earliest economic theories, which stated that a country's wealth was determined by the amount of gold and silver they had in their possession - mercantilism When the value of a country's exports is greater than the value of goods being imported - trade surplus Money paid by the government to help an organization or industry reduce its costs - government subsidies International trade left to its natural course without tariffs, quotas, or other restrictions - Free trade Country A exports more goods to Country B than it imports from Country B. Country A receives more monetary gain by using this practice. Which relationship does Country A have with Country B? - Trade surplus Country A has been criticized by other countries for giving generous tax credits to its corn farmers, which enables the country's farmers to sell corn on the international markets for cheaper than all other countries. Which term is used by other countries to describe this practice? - Government subsidies The obstacles that make it difficult for a new company to enter a given market. These barriers may include technology challenges, high start-up costs, or government regulations - barriers to entry A proportionate savings in costs gained by an increased level of production - Economies of scale a country should specialize in the production of goods it can produce relatively more efficient than another country. This allows countries to focus on the products for which they have the lowest opportunity costs. However, many assumptions are made in this theory. - Comparative advantage states that Tariffs that protect a domestic industry by making imported goods more expensive than equivalent goods produced domestically - Protective tariffs Tariffs levied to raise revenue for the government - Revenue tariffs Import taxes expressed in an amount of money per unit imported - Specific tariffs Import taxes based on a fixed percentage of the assessed commercial value of imported goods - Ad valorem tariffs Taxes on imported goods that are a combination of a fixed amount and an amount based on the value of the goods - Compound tariffs A quota that strictly limits the quantity of goods that may enter a country. - absolute quota A quota that permits a specified quantity of imported goods to enter a country at a reduced rate during the quota period. - tariff-rate quota A trade restriction on the quantity of a good that an exporting country is allowed to export to another country - Voluntary export restrictions The process of buying goods and services by a government agency through a specific process of issuing bid proposals and seeking responses from companies. - Government procurement programs How are free trade agreements handled differently than treaties in the United States? - Treaties must be approved by the Senate, whereas a free trade agreement must pass both houses of Congress. What is a benefit of implementing a system of free trade? - Reduced tariffs would result in lower costs of imported raw materials. the practice of charging a lower price for a product (perhaps below cost) in foreign markets than in the firm's home market. - Dumping How do antidumping laws protect a domestic market? - They prevent foreign companies from selling goods and services at or below cost. A small clothing company based in California decided that it needed to have an application (app) and an updated website. Because this is a small company, it did not have the technological expertise to handle this improvement. The company hired a company based in Pakistan to handle its technology needs. Which common practice among companies is this an example of? - Outsourcing Which strategy is used by governments to limit the foreign direct investment in a country? - Creating foreign ownership restrictions in the country Which activity is considered a foreign direct investment (FDI) by a multinational corporation? - Setting up manufacturing plants in the host country The total dollar value of a company's outstanding shares of stock - market capitalization horizontal and vertical - Two forms of FDI ~ greenfield ~ brownfield - different kinds of FDI What is a reason for companies to engage in foreign direct investments? - To take advantage of tax exemptions offered by the host country Which country characteristic is most important to foreign direct investors according to a study by the World Bank? - ~ Political stability ~ security What is the result of the existence of multinational businesses? - Economic integration among countries What is a benefit of foreign direct investment? - The inflow of capital benefits global and local economies What is a potential influence of the existence of multinational corporations (MNCs) on international relations? - Improves relations between countries where the MNC operates What is an accurate characterization of the relationships between multinational corporations (MNCs) and the host country governments in which they operate? - The relationships are mixed because MNCs can cause, but also solve, problems for the host country. Which level of economic integration presents an alliance of all policies by a common organization? - Political union Which level of economic integration is formed when trade barriers are removed between member countries but there is no mutual policy on trading with nonmember countries? - Free trade area Which level of economic integration permits the free movement of capital, labor and technology from member countries? - Common market Which economic integration stage offers economic collaboration by removing trade barriers between member countries and establishing a mutual trading policy with nonmembers? - Customs union Which drawback is involved when regional agreements are created? - Member countries will trade less with nonmember countries. What is a benefit of creating a regional economic integration agreement? - Improved financial growth What is an advantage of regional economic integration? - Flexibility on labor movement develops job opportunities. What is a disadvantage of regional economic integration? - The exclusion of external countries reduces global free trade. United States Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua. - Central America Free Trade Agreement (CAFTA-DR) Which agreement was implemented in 1994 and helped form a free-trade zone between Canada, the United States, and Mexico by decreasing tariffs and trade barriers? - NAFTA Which agreement was established in 1988 and now has both political and economic goals to keep peace and stimulates economic growth in South American countries? - MERCOSUR Malaysia, Thailand, Indonesia, Singapore, the Philippines, Myanmar (Burma), Vietnam, Cambodia, Laos, and Brunei. - ASEAN includes Which economic actors are suppliers of U.S. dollars? - Foreign firms exporting to the U.S. The way in which an authority manages its currency in relation to other currencies and the foreign exchange market - exchange rate regime A system where the value of currency in relation to others is allowed to freely fluctuate subject to market forces - floating exchange rate A system where a currency's value is tied to the value of another single currency, to a basket of other currencies, or to another measure of value, such as gold - fixed exchange rate system A currency system that fixes an exchange rate around a certain value, but still allows fluctuations, usually within certain values, to occur - pegged exchange rate Which economic actor benefits as the U.S. dollar weakens? - A U.S. investor abroad Which economic actor benefits as the U.S. dollar strengthens? - A foreign firm exporting to the U.S. Which exchange rate regime allows a currency's value to fluctuate according to the foreign exchange market? - Floating Consumer protection policy used to limit unfair business practices related to competition and control of prices - antitrust laws A market in which no individual economic actor can affect the price of a good - perfectly competitive market The first American antitrust policy. Established in 1890, it dealt with limiting the power of price-controlling cartels - Sherman Antitrust Act See antitrust laws. - competition laws See antitrust laws. - antimonopoly laws A farmers market has many vendors and consumers who all sell and buy the same produce at the same price. Which type of market is represented? - perfect competition A sole, national telephone company was found violating antitrust laws and was forced to separate into regional companies. What caused the violation of the antitrust laws? - reduced competition Many countries from several geographic regions are accused of dumping steel into the U.S. market at unfairly low prices. Which entity can the United States appeal to in order to correct this apparent market manipulation? - World Trade Organization Universal global climate deal aimed at keeping long-term global temperature increase at below 2°C - Paris Agreement American environmental act from the 1970s that requires federal agencies to prepare environmental impact statements for every recommendation or report - National Environmental Policy Act (NEPA) American agency established in the 1970s with the goal of monitoring the environmental practices of industry - The Environmental Protection Agency (EPA) A 2010 industrial accident that is considered the largest oil spill in history - Deepwater Horizon oil spill