BUSINESS IN GLOBAL MARKETS

Question 0

Trade is?

Answer 0

unencumbered to the extent that economic and political barriers to trade are eliminated.

Question 1

What is Free trade?

Answer 1

is the relatively unencumbered movement of goods and services between and among nations.

Question 2

The theory of comparative advantage states that?

Answer 2

a nation should export products that it produces most efficiently and only import goods it can’t produce efficiently.

Question 3

Absolute advantageoccurs when?

Answer 3

a nation has a monopoly on some internationally desired commodity.

Question 4

For any nation, the balance of trade is?

Answer 4

the ratio of imports to exports.

Question 5

A trade surplusexists when?

Answer 5

the value of a nation’s exports exceeds the value of its imports. In such cases, we say the balance of trade is favorable.

Question 6

An unfavorable trade deficit is seen when?

Answer 6

the value of a nation’s imports exceeds the value of its exports.

Question 7

What is Dumping?

Answer 7

is the practice of selling products to foreign countries at lower prices than are charged domestically.

Question 8

A gray market is?

Answer 8

one that’s outside the market or markets intended by the manufacturer or producer. For example, a domestic wholesaler or jobber for DVDs produced by a film-production company might offer some of them to foreign companies that may be perfectly happy to offer a kickback—or worse, resell them to distributors of pirated dubs.

Question 9

Tariffs are?

Answer 9

taxes on imports.