International Business Chapters One through Three Unit Review

This review is a direct reflection of the test that you will see in a few days. Please try your best to answer the questions as correctly as possible. Good Luck! Click on the house to begin the review

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Question #1 Name two of the five reasons companies are driven to the international market? Political Market Endowment Factors Portfolio investment

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Question #2 Cost, as a Globalization Force, allows product lines to achieve … Cost Savings Economies of Scale

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Question #3 Endowment factors are the pieces that go into a country’s ability to … Produce something Import Products

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Question #4 Name a type of domestic operation within a foreign country … Foreign Business International Business

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Question #5 Which of the following companies is an example of an international business? Lilly insulin in Belgium McDonalds Ford Motor

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Question #6 Economic Nationalism represents the strategy of … Comparative Advantage Mercantilism

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Question #7 The trend toward unification and socialization of the global community is which globalization force? PoliticalMarket Competitive

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Question #8 Non –Americans owned __________ of stock and bonds in the United States? 1.9 Trillion2.8 Trillion

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Question #9 What country is the largest owner of United States government debt (i.e.: treasury notes)? China United Kingdom Japan

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Question #10 The book Wealth of Nations was written to disprove the economic trade theory of … Comparative Advantage Mercantilism

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Question #10 Of the two parts of foreign investment which part’s sole purpose is obtaining a return of funds invested? Direct investment Portfolio investment

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Question #11 Which is NOT a benefit of the First Mover Theory? Large market share Discourage competitors Reduced costs Increased Exports

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Question #12 What percentage do developed nations trade with other developed nations _________ ? 63% 72% 84%

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Question #13 Which is the easiest of the steps to begin foreign trade? Setting up a foreign sales company Exporting Establishing foreign production facility

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Question #14 The invention of what one thing has allowed small firms to compete globally Wireless phone internet Palm Pilots

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Question #15 What is it called when someone begins foreign trade and turns the distribution over to someone else Retailing Wholesaling

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Question #16 True/False: Larger firms begin foreign trade by wholesaling TRUE FALSE

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Question #17 Competition, as a globalization force, says that to protect your home market by _________ a competitor’s market Entering into Importing from

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Question #18 Heckscher-Olin Theory states that if a country has an abundant amount of production factors, they should … Export those products Manufacture different products Export different resources

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Question #19 Which is NOT a reason why companies will go abroad? Protection from competition Increase Technology Increase sales

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Question #20 Setting up a foreign sales company is the __________ set to beginning foreign trade? Hardest Moderate Easiest

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Question #21 When investors participate in the management of a foreign firm and receive profits on investments that is called … Portfolio Investment Direct Investment

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Question #22 The United States is the ______ largest investor nation in the world? Third SecondFirst Last

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Question #23 The major economic theory in Europe between the 16 th and 18 th century was … Mercantilism Importing Priority Nationalism

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Question #24 Prices of the factors depend only on the supply of those factors is an assumption of which theory? Heckscher — Olin Theory First mover theory Comparative advantage

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Question #25 In a trade situation where one party must lose for another to gain is called … Win-Lose Theory Zero Sum Gain Game Theory

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Question #26 When company’s globalize, they also become global customers. Which globalization force is this? Market CostPolitical

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Question #27 What book was written to dispel government intervention and control over trade? Principles of Political Economy and Taxation Communist Manifesto Wealth of Nations

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Question #28 Which is NOT a reason developed nations trade with other developed nations? Strong cultural objections Foreign exchange is available Business Climate Satisfactory transportation

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Question #29 True/False: It is larger countries that are huge One Way trade imposters? TRUE FALSE

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Question #30 True/False: Despite good intentions, most developed nations DO NOT trade with developing nations? TRUE FALSE

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Question #31 A business whose activities are carried out across national borders is a … Foreign Business International Business

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Question #32 Privatization of state owned firms to increase trading is which globalization force? Market Political Competitive

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Question #33 Land, Labor, and Capital are pieces that go into a country’s ability to produce something. These are called? Supply chain parts Endowment Factors Production Components

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Question #34 Technology, as a globalization force, DOES NOT allows companies to do which of the following better? Track shipping Increase sales Oversee manufacturing Coordinate production

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Question #35 True or false: Larger, developed nations are huge proponents of one way trade? FalseTrue

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Question #36 One assumption about Heckscher - Olin is that technology is ___________ available. Universally Selectedly Not

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Question #37 Trade between countries is due to _______ in the endowment factors of production Similarities Availability Differences

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Question #38 The G8 countries are also called ____________ countries? Industrialized New Industrialized Developing

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Question #38 Which of the following is NOT a developed country? Canada Brazil Israel United States

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Question #39 Mercantilism believes that the only source of true wealth is? Expanding the Empire Accumulation of precious metals Increasing Imports

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Question #40 In mercantilism, the driving force to increase wealth was? Building bigger ships Imports from other countries Explore the new world

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Question #41 The Theory of Comparative Advantage was developed by? David Ricardo Eli Heckscher Adam Smith Alan Greenspan

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Question #42 Which is the hardest step in the process of beginning foreign trade? Exporting Foreign production facility Foreign sales company

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Question #43 Income that is not directly concerned with the control of a firm is called? ActivePassive

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Question #44 Americans owned _____ in foreign securities in 2002? $4.65 billion $2.9 trillion $786 million $1.84 trillion

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Question #45 With the first mover theory, first mover companies normally hold _____ of the market share? 20% 40% 30% 75%

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Question #46 Which of the following is an new industrialized country? Australia China Ghana Mexico

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Question #47 The largest “investor” country in the United States is? CanadaChina Japan United Kingdom

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Question #48 Specialized labor is a tenant of which economic theory? Laffler Curve Comparative Advantage Absolute Advantage

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Question #49 What are the two main items firms want to increase when deciding to go abroad? Profits / Sales Imports & Market share Exports & Workforce

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Question #50 Infant Industries will have a well trained _______________? Export channels Import process Labor force

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Question #51 A country has an advantage in making a product when its absolute disadvantage is less is called? Comparative Advantage Absolute Advantage

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Question #52 The political global force of business leads to the ______ of trade barriers and _____ of the global community? reductions / unification Increase / socialization Increase / separation

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Question #53 Fast growing, middle income countries are called? Developed Transition New Industrialized

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Question #54 True / False: New Industrialized Countries import large amounts of manufactured goods and have a low concentration of foreign investment? TRUEFALSE

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Question #55 What was a special category of economic development created just for China? Emerging market economy Transition country

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Question #56 True/False: In developing countries, government legislated fringe benefits are higher than other country types? TrueFALSE

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Question #57 National Defense trade restrictions call for the _______ of important national industries? De-regulationExporting Protection

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Question #58 True/False: Protection of infant industries is always long term and normally have a negative effect? TRUEFALSE

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Question #59 True/False: Trade sanctions main goal is to hurt workers in the offending nation? TRUEFALSE

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Congratulations You have complete the first portion of the online review. Click here for more valuable information

More Valuable Information Don’t forget that you need to know the Arguments for trade Restrictions (last page of chapter three notes) Click on the house if you want info on the essay questions

Essay Question Information 1) International Product Life Cycle (at least 12 points) 2) Why is an international workforce is beneficial to a global company (i.e. globalized workforce)  Cirque du Soleil video from class More Essay Info

If you want to re-watch the Cirque du Soleil video from class, there will be a showing on Wednesday after school in Room 246 at 3:30. Click here for more valuable essay information

More Essay Info 3) Table 2.2 (p 39)  tell me what it all means and give me some numbers (interpret the table) 4) Tables 2.11 & 2.12 (p54 & 55)  tell me what it all means and give me some numbers (interpret the table) Click here is you want to re-take the review Click here to complete the review

Good Work! Good luck on the exam! It will be written part on Thursday, essay part on Friday!