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International Management: Culture, Strategy, and Behavior, 10th Edition Test Bank

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    Chapter 01 - Globalization and International Linkages 1 - 1 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Chapter 01 Globalization and International Linkages True/False Questions 1 . Internationalization is the vision of creating one world unit, a single market entity. Answer: False Feedback: Internationalization is the process of a business crossing national and cultural borders, while globalization is the vision of creating one world unit, a single market entity. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 2 . In the context of the changing global demographics, elderly populations spend money on housing and other capitally financed purchases. Answer: False Feedback: While elderly populations spend money on health care services, younger populations spend income on housing and other capitally financed purchases. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 3 . North American Free Trade Agreement (NAFTA) members are better integrated as a single market than the European Union (EU) or the allied Asian countries. Answer: False Feedback: Even though long - standing cultural differences remain, and the European Union has recently experienced some substantial challenges, the European Union is more integrated as a single market than NAFTA, CAFTA, or the allied Asian countries. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 4 . General Electric (GE) has strategically leveraged social media to improve its long - term brand image. Answer: True Feedback: General Electric (GE) has strategically leveraged social media to improve its long - term brand image. By interacting daily with customers across a variety of social networks, the

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    Chapter 01 - Globalization and International Linkages 1 - 2 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. 100 - year - old company aims to transform the way that its brand is perceived while simultaneously building a new generation of consumers. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: An Interconnected World 5 . An increase in the ease of travel between countries is an important development that has occurred because of the North American Free Trade Agreement (NAFTA). Answer: True Feedback: An increase in the ease of travel between countries is an important development that has occurred because of the North American Free Trade Agreement (NAFTA). Other important developments include the elimination of tariffs as well as import and ex port quotas, the opening of government procurement markets to companies in Canada and Mexico , an increase in the opportunity to make investments in each other’s country, and the removal of restrictions on agricultural products, auto parts, and energy goods . AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 6 . According to a Goldman Sachs global economics team report, it is estimated that the economies of Brazil, Russia, India, and China, which it collectively coined as the "BRIC" nations, will surpass the collective economies of the G7 nations by 2032. Answer: True Feedback: According to a Goldman Sachs global economics team report, it is estimated that the economies of Brazil, Russia, India, and China, which it collectively coined as the "BRIC" nations, will surpass the collective economies of the G7 nations by 2032. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 7 . Foreign direct investment has been falling alarmingly since the global recession of 2009 in most regions of the world. Answer: False Feedback: Foreign direct investment (FDI) — the term used to indicate the amount invested in property, plant, and equipment in another country — has been growing at a slow but steady rate in the years since the global recession of 2009. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities.

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    Chapter 01 - Globalization and International Linkages 1 - 3 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 8 . In a command economy, a general balance between supply and demand sustains prices, while an imbalance creates a price fluctuation. Answer: False Feedback: In a command economy, the government has explicit control over the price and supply of a good or service. The particular goods and services offered are not necessarily in response to consumers ' stated needs but are determined by the theoretical advancement of society. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 02 REVIEW the major trends in global and regional integration. Level of Difficulty: 1 Easy Topic: Global Economic Systems 9 . Monopolies are a danger to the market economy system because they tend to stifle economic growth. Answer: True Feedback: Monopolies are a danger to the market economy system because they tend to stifle economic growth and consumer choice with their power to determine supply. Factors such as efficiency of production and quality and pricing of goods can be chosen arbitrarily b y monopolies, leaving consumers without a choice and at the mercy of big business es . AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 02 REVIEW the major trends in global and regional integration. Level of Difficulty: 1 Easy Topic: Global Economic Systems 10. In the context of the emerging markets of Asia, India is attractive to multinationals, especially U.S. and British firms. Answer: True Feedback: India is attractive to multinationals, especially U.S. and British firms. Many Indian people speak English, are very well educated, and are known for advanced information technology expertise. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 1 1 . The United States has considerable foreign direct investment in Germany , more than in any other country. Answer: False Feedback: The United States has considerable foreign direct investment in Canada, more than in any other country . Canada is the United States ' largest trading partner, a position it has held for many years. AACSB: Analytic

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    Chapter 01 - Globalization and International Linkages 1 - 4 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 1 2 . Despite being unable to take full advantage of globalization, there is still hope in the future for Africa because the potential of African countries remains virtually untapped. Answer: True Feedback: Despite being unable to take full advantage of globalization, there is still hope in the future for Africa because the potential of African countries remains virtually untapped. Not only are there considerable natural resources, but the diversity itself al so can be used to advantage. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 1 3 . One of the factors that contributed to t he early success of the Japanese economy is the presence of chaebols. Answer: False Feedback: One of the factors that contributed to the early success of the Japanese economy is the Ministry of International Trade and Industry (MITI). This is a governmental agency that identifies and ranks national commercial pursuits and guides the distribution of national resources to meet these goals. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 1 4 . About 46 percent of employees in b oth the United States and Russia would prefer a work schedule that fluctuates between work and leisure, mirroring a pattern of recurring sabbaticals . Answer: True Feedback: About 46 percent of employees in both the United States and Russia would prefer a work schedule that fluctuates between work and leisure, mirroring a pattern of recurring sabbaticals. This similarity can be taken into account by a U.S. firm when considering opening a business in Russia. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions

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    Chapter 01 - Globalization and International Linkages 1 - 5 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. 1 5 . The ultimate objective of the European Union (EU) is to eliminate all trade barriers among member countries. Answer: True Feedback: The ultimate objective of the European Union is to eliminate all trade barriers among member countries (like between the states in the United States). AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 1 6 . The economy of Argentina outweighs that of any other South American country with an economic output comparable to that of France and has become a worldwide presence. Answer: False Feedback: The Brazilian economy outweighs that of any other South American country with an economic output comparable to that of France and has become a worldwide presence. Given Brazil ' s large and relatively well - educated population, ample natural resources, existing industrial base, and strategic geographic position, longer - term prospects are still potentially positive. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 17 . The Brazilian economy outweighs that of any other South American country with an economic output comparable to that of France. Answer: True Feedback: The Brazilian economy outweighs that of any other South American country with an economic output comparable to that of France. Longer - term prospects are still potentially positive because of its large and relatively well - educated population, ampl e natural resources, existing industrial base, and strategic geographic position. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 18 . China remains a major risk for investors because they are required to maintain a delicate balance between the country's communist and capitalist systems. Answer: True Feedback: China remains a major risk for investors. The one country, two systems (communism and capitalism) balance is a delicate one to maintain, and foreign businesses are often caught in the middle. AACSB: Analytic Bloom's: Remember

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    Chapter 01 - Globalization and International Linkages 1 - 6 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 19. Hungary 's economy was the only economy in the EU to continue to grow during the global recession of 2008 – 2009. Answer: False Feedback: Poland ' s economy was the only economy in the European Union to continue to grow during the global recession of 2008 – 2009. In 2015, Poland ' s GDP grew by around 4 percent. Although the relatively swift transition to a market economy has been very difficult for the Polish people, with very high inflation initially, continuing unemployment, and the decline of public services, Poland ' s economy has done relatively well. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions 20. Singapore has emerged as an urban planner ' s ideal model and the leader and financial center of Southeast Asia. Answer: True Feedback: Singapore has emerged as an urban planner ' s ideal model and the leader and financial center of Southeast Asia. It is a major success story , and its solid foundation leaves only the question of how to continue expanding in the face of increasing international competition. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 03 EXAMINE the changing balance of global economic power and trade and investment flows among countries. Level of Difficulty: 1 Easy Topic: Economic Performance and Issues of Major Regions Multiple Choice Questions 2 1 . _____ is t he process of applying management concepts and techniques in a multinational environment and adapting management practices to different economic, political, and cultural environments . A. Strategic management B. Internationalization C. Globalization D. International management Answer: D Feedback: International management is the process of applying management concepts and techniques in a multinational environment and adapting management practices to different economic, political, and cultural contexts. AACSB: Analytic

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    Chapter 01 - Globalization and International Linkages 1 - 7 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Introduction 2 2 . To qualify as a multinational corporation (MNC) , a firm must meet all of the following criteria except: A. operations in more than one country . B. international sales . C. a mix of nationalities among managers and owners . D. sales of at least one million dollars per year . Answer: D Feedback: An MNC is a firm that has operations in more than one country, international sales, and a mix of nationalities among managers and owners. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Introduction 2 3 . Critics of globalization believe that : A. the offshoring of business services jobs to lower - wage countries inherently creates greater opportunities at home. B. growing trade deficits and slow wage growth are damaging economies. C. when production moves to countries to take advantage of less - regulated environments, an upward pressure is created on wages and working conditions. D. the main winners of globalization are the low - wage workers. Answer: B Feedback: In the context of globalization, critics believe that growing trade deficits and slow wage growth are damaging economies. T hey also believe that globalization may be moving too fast for some emerging markets, which could r esult in economic collapse. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 2 4 . The subcontracting or contracting out of activities to external organizations that had previously been performed by a firm is called _____. A. homesourcing B. insourcing C. offshoring D. outsourcing Answer: D Feedback: Outsourcing is the subcontracting or contracting out of activities to external organizations that had previously been performed by a firm.

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    Chapter 01 - Globalization and International Linkages 1 - 8 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 2 5 . _____ is t he process by which companies undertake some activities at offshore locations instead of in their countries of origin . A. Homesourcing B. Insourcing C. Offshoring D. Globalization Answer: C Feedback: Offshoring is the process by which companies undertake some activities at offshore locations instead of in their countries of origin. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 2 6 . The _____ is t he global organization of countries that oversees rules and regulations for international trade and investment, including agriculture, intellectual property, services, competition , and subsidies . A. WTO B. NAFTA C. WIPO D. ITO Answer: A Feedback: The WTO is the global organization of countries that oversees rules and regulations for international trade and investment, including agriculture, intellectual property, services, competition, and subsidies. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 27 . The _____ is a free - trade agreement among the United States, Canada, and Mexico that has removed most barriers to trade and investment . A. AFTA B. EFTA C. CAFTA D. NAFTA Answer: D

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    Chapter 01 - Globalization and International Linkages 1 - 9 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Feedback: The United States, Canada, and Mexico make up the North American Free Trade Agreement (NAFTA), which in essence has removed all barriers to trade among these countries and created a huge North American market. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 28 . Identify a true statement about the Development Round in which the members of the World Trade Organization (WTO) met and launched a round of negotiations at Doha, Qatar in November 2011 . A. The WTO members agreed upon the opening of government procurement markets to companies in the developed nations . B. There was a lack of consensus among WTO members regarding agricultural subsidies. C. There was a lack of consensus among WTO members regarding unbalanced population pyramids . D. The WTO members agreed up on the issues of competition. Answer: B Feedback: During the Development Round in which the members of the World Trade Organization (WTO) met, in November 2011, and successfully launched a new round of negotiations at Doha, Qatar, there was a lack of consensus among WTO members regarding agricultural subs idies and the issues of competition and government procurement. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty : 1 Easy Topic: Globalization and Internationalization 29 . The United States, Canada , and Mexico make up the _____, which in essence has removed all barriers to trade among these countries and created a huge North American market. A. General Agreement on Tariffs and Trade B. North American Common Market C. North American Free Trade Agreement D. North American Trade Union Answer: C Feedback: The United States, Canada, and Mexico make up the North American Free Trade Agreement (NAFTA), which in essence has removed all barriers to trade among these countries and created a huge North American market. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization

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    Chapter 01 - Globalization and International Linkages 1 - 10 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. 3 0 . Agreements like NAFTA and CAFTA: A. n ot only reduce barriers to trade but also require additional domestic legal and business reforms in developing nations to protect property rights . B. d o not include supplemental commitments like the FTAA does on labor and the environment to encourage countries to upgrade their working conditions and environmental protections . C. r ely exclusively on MNCs exporting or setting up operations locally rather than buying out a domestic firm . D. p rovide firms with enough security so they cannot go out of business, which simply encourages a lack of efficiency or incentive to monitor costs . Answer: A Feedback: Agreements like NAFTA and CAFTA not only reduce barriers to trade but also require additional domestic legal and business reforms in developing nations to protect property rights. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 3 1 . In the context of the changing global demographics , identify a change that will be seen in developed nations . A. Developed Asian nations will be able to easily replace the retiring, aging population. B. In Japan, the number of nonworkers will be nearly equal to that of workers by 2050. C. In South Korea, the immigration policy will ease by 2050. D. In Germany, there will be a removal of restrictions on agricultural products, auto parts, and energy goods. Answer: B Feedback: D emographic changes are projected to occur globally, and the most dramatic impact will be seen in the developed nations. In Japan, the number of nonworkers will be nearly equal to that of workers by 2050. Both Japan and South Korea will face a loss of over 25 percent of their working - class population. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 3 2 . According to some critics, agreements like North American Free Trade Agreement (NAFTA) and Central American Free Trade Agreement (CAFTA): A. have been successful in ensuring environmental standards. B. have been successful in preventing the decline of the global working - age population. C. do not go far enough in ensuring worker rights. D. do not go far enough in protecting property rights. Answer: C Feedback: According to some critics, agreements like North American Free Trade Agreement (NAFTA) and Central American Free Trade Agreement (CAFTA) do not go far enough in

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    Chapter 01 - Globalization and International Linkages 1 - 11 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. ensuring worker rights. They also believe that the agreements do not go far enough in ensuring environmental standards. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 3 3 . The Asian economic block, made up of Indonesia, Malaysia, the Philippines, Singapore, Brunei, Thailand, Cambodia, Myanmar, and Vietnam , is referred to as the : A. Association of Southeast Asian Nations (ASEAN) . B. Southeast Asia Free Trade Agreement (SWAFTA) . C. Southeast Asia Common Market . D. Asian Economic Union . Answer: A Feedback: The Association of Southeast Asian Nations (ASEAN) is made up of Indonesia, Malaysia, the Philippines, Singapore, Brunei, Thailand, and , in recent years , Cambodia, Myanmar, and Vietnam. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 3 4 . A method that adjusts GDP to account for different prices in countries is called: A. c umulative distribution function . B. n ominal GDP . C. c urrent currency exchange rate . D. p urchasing power parity . Answer: D Feedback: Purchasing power parity (PPP) is a method that adjusts GDP to account for different prices in countries. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 3 5 . Unlike the Group of Seven ( G7 ) economies, the Emerging Seven ( E7 ) economies are: A. primarily located in North America and Europe. B. located throughout Latin America and Asia. C. mature economies in which economic growth is slow. D. incentivizing citizens to have more children . Answer: B Feedback: Unlike the Group of Seven ( G7) economies, the Emerging Seven (E7) economies are located throughout Latin America and Asia. In March 2006, the term E7 was coined by

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    Chapter 01 - Globalization and International Linkages 1 - 12 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. PricewaterhouseCoopers (PwC) to describe seven major emerging economies of Brazil, China, India, Indonesia, Mexico, Russia, and Turkey that are expected to expand significantly in the coming decades. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 3 6 . Which of the following statements is true according to the reports that were released in 2004 and 2011 by t he Goldman Sachs global economics team ? A. The economies of Russia and Brazil would remain unaffected by the low prices for oil and other commodities in the years 2015 and 2016. B. The BRIC (Brazil, Russia, India, and China) economies ' share of world growth could rise significantly from 2003 to 2025. C. The economies of Indonesia, Mexico, and Turkey c ould expand significantly in the coming decades. D. The E7 (Brazil, China, India, Indonesia, Mexico, Russia, and Turkey) economies would mature and slow down in terms of market exchange rates. Answer: B Feedback: According to the reports that were released in 2004 and 2011 by the Goldman Sachs global economics team, the BRIC (Brazil, Russia, India, and China) economies ' share of world growth could rise significantly from 2003 to 2025. It could rise from 20 percent in 2003 to more than 40 percent in 2025. The reports also predicted that the BRIC ' s total weight in the world economy would rise from approximately 10 percent in 2004 to more than 20 percent in 2025. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 37 . _____ is t he term used to indicate the amount invested in property, plant, and equipment in another country . A. Exporting B. Foreign direct investment C. Importing D. Trade imperfection Answer: B Feedback: Foreign direct investment (FDI) is the term used to indicate the amount invested in property, plant, and equipment in another country. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization

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    Chapter 01 - Globalization and International Linkages 1 - 13 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. 38 . According to the World Trade Organization, in 201 4 merchandise exports: A. r eached a record high . B. d eclined for the first time since 1983 . C. remained fairly consistent . D. decreased by almost 50 percent . Answer: A Feedback: According to the World Trade Organization, in 201 4 merchandise exports reached a record high $18.2 trillion, and commercial services exports have rebounded to $4.2 trillion. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 39 . In 2009, global FDI _____. A. n early doubled B. nearly tripled C. dropped substantially D. remained fairly constant Answer: C Feedback: In 2009, g lobal FDI dropped significantly by almost 50 percent to $896 billion . It rebounded to $1.5 trillion by 2013. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 4 0 . By 2017, foreign direct investment ( FDI ) is estimated to : A. surpass the all - time high set a decade earlier in 2007. B. reach an all - time low due to political instability and uncertain markets . C. experience a significant drop similar to the global recession of 2009. D. experience an insignif icant rise due to a slow rate of increase of merchandise exports . Answer: A Feedback: By 2017, foreign direct investment (FDI) is estimated to surpass the all - time high set a decade earlier in 2007. Despite dropping almost 50 percent in 2009 to $896 billion, global FDI rebounded to $1.5 trillion by 2013. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization

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    Chapter 01 - Globalization and International Linkages 1 - 14 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. 4 1 . In the context of the shifting b alance of e conomic p ower in the g lobal e conomy , w hich of the following factors has helped boost incomes and wealth in the African continent between 2000 and 2015 ? A. A one - child policy B. An i ncrease in the price of agricultural products C. An increase in the size of the elderly population D. An easy immigration process for workers Answer: B Feedback: In the context of the shifting balance of economic power in the global economy , an increase in the price of agricultural products has helped boost incomes and wealth in the African continent between 2000 and 2015 . Also, increases in the price of commodities, such as oil , gas, and mineral and mining products have helped boost incomes and wealth in the continent. AACSB: Analytic Bloom ' s : Understand Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 2 Medium Topic: Globalization and Internationalization 42 . The Trans - Pacific Partnership (TPP) is a trade agreement among 12 Pacific Rim countries, including: A. Peru, the United States, and Vietnam. B. Great Britain, New Zealand, and China. C. India, Canada, and Australia. D. Singapore, Russia, and Chile. Answer: A Feedback: The Trans - Pacific Partnership (TPP) is a trade agreement among 12 Pacific Rim countries, including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam. AACSB: Analytic Bloom's: Remember Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 43 . Which of the following economies is projected to be come the largest by 2050 using market exchange rates? A. China B. India C. Australia D. Brazil Answer: A Feedback: The economy of China is projected to be come the largest by 2050 using market exchange rates. China would surge past the United States and Japan as the largest world economic power by 2050. AACSB: Analytic Bloom's: Remember

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    Chapter 01 - Globalization and International Linkages 1 - 15 Copyright © 2018 McGraw - Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw - Hill Education. Learning Objective: 01 - 01 ASSESS the implications of globalization for countries, industries, firms, and communities. Level of Difficulty: 1 Easy Topic: Globalization and Internationalization 4 4 . A _____ is comparable to a monopoly in the sense that an organization, in this case the government, has explicit control over the price and supply of a good or service. A. command economy B. market economy C. mixed economy D. socialist economy Answer: A Feedback: A command economy is comparable to a monopoly in the sense that an organization, in this case the government, has explicit control over the price and supply of a good or service. AACSB: Analytic Bloom ' s : Remember Learning Objective: 01 - 02 REVIEW the major trends in global and regional integration. Level of Difficulty: 1 Easy Topic: Global Economic Systems 4 5 . Identify a characteristic of a market economy. A. The state reserves the right to monitor the production and distribution of goods and services. B. Private enterprise s reserve the right to own property. C. Monopolies boost economic growth. D. Competition is discouraged because it hinders penetration into niche markets. Answer: B Feedback: A market economy exists when private enterprise reserves the right to own property and monitor the production and distribution of goods and services while the state simply supports competition and efficient practices. Management is particularly effective here since private ownership provides local evaluation and understanding, opposed to a nationally standardized archetype. AACSB: Analytic Bloom's: Understand Learning Objective: 01 - 02 REVIEW the major trends in global and regional integration. Level of Difficulty: 2 Medium Topic: Global Economic Systems 4 6 . Unlike a market economy, a command economy is characterized by : A. private ownership of businesses . B. an appropriate response to consumers ' stated needs and desires. C. insufficient security provided by government subsidies. D. an ignorance of demographic information by management. Answer: D Feedback: Unlike a market economy, a command economy is characterized by an ignorance of demographic information by management. In a market economy, individuals within the community disclose wants, needs, and desires to which businesses may appropriately respond.

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