Chapter 12 - Lecture Flashcards
What is deindustrialization?
A) The relocation of industries to urban centers.
B) A decline in the manufacturing sector’s share of the economy.
C) A shift toward agrarian-based economies.
D) The transition from services to manufacturing.
B) A decline in the manufacturing sector’s share of the economy.
What has contributed most to the rise of the service sector?
A) Increased demand for tangible goods.
B) Mechanization and mass production freeing labor for other roles.
C) A global shift toward agrarian economies.
D) Decreased urbanization and technological advancements.
B) Mechanization and mass production freeing labor for other roles.
Why is Detroit considered a symbol of deindustrialization?
A) It transitioned into a healthcare hub.
B) Its population and auto industry declined dramatically.
C) It became a major center for global service industries.
D) Its economy shifted entirely to finance and education.
B) Its population and auto industry declined dramatically.
How did Pittsburgh adapt after the decline of its steel industry?
A) It became a center for advanced manufacturing technologies.
B) Healthcare replaced steel as the largest employer.
C) It developed a thriving tourism sector.
D) Financial services took over as the dominant sector.
B) Healthcare replaced steel as the largest employer.
What sector dominated in New York, London, and Tokyo in the 1980s?
A) Heavy industry
B) Advanced services like law, finance, and accounting
C) Agricultural exports
D) High-tech manufacturing
B) Advanced services like law, finance, and accounting
Why did globalization paradoxically concentrate industries in global cities?
A) Telecommunication advancements decentralized decision-making.
B) Global cities became hubs for investment, trade, and multinational corporations.
C) Urbanization slowed in the 1980s.
D) Developed nations limited international capital flows.
B) Global cities became hubs for investment, trade, and multinational corporations.
What is the key difference between offshoring and outsourcing?
A) Offshoring involves hiring foreign suppliers, while outsourcing relies on domestic suppliers.
B) Offshoring is about relocating production to foreign facilities managed by the company itself, while outsourcing involves independent suppliers.
C) Offshoring is exclusive to the service sector, while outsourcing is for manufacturing.
D) Offshoring always leads to tax evasion, whereas outsourcing does not.
B) Offshoring is about relocating production to foreign facilities managed by the company itself, while outsourcing involves independent suppliers.
How did technological advancements support the rise of offshoring?
A) They increased labor costs in advanced economies.
B) They facilitated global communication and logistics.
C) They restricted the movement of capital across borders.
D) They reduced trade barriers entirely.
B) They facilitated global communication and logistics.
What is a significant downside of offshoring for advanced economies?
A) Increased reliance on local labor markets.
B) Loss of skilled jobs and weakened unions.
C) Greater protection for domestic workers.
D) Rising costs of production in low-wage countries.
B) Loss of skilled jobs and weakened unions.
Why has offshoring not benefited all developing countries equally?
A) Only a few countries have attracted most of the offshored jobs.
B) Developing countries lack the infrastructure for basic industries.
C) Trade regulations prevent global production models.
D) Most developing countries refuse to participate in global markets.
A) Only a few countries have attracted most of the offshored jobs.
What is the purpose of offshore financial centers?
A) To fund global infrastructure projects.
B) To provide financial services to non-residents and minimize taxes.
C) To regulate multinational corporations.
D) To stabilize currency flows in advanced economies.
B) To provide financial services to non-residents and minimize taxes.
What was revealed by the Panama Papers in 2016?
A) The inefficiency of offshore financial centers.
B) The role of offshore entities in hiding assets and evading taxes.
C) Global efforts to regulate multinational corporations.
D) The decline of tax havens in developing nations.
B) The role of offshore entities in hiding assets and evading taxes.
How did Bretton Woods institutions like the IMF and World Bank contribute to offshoring?
A) They created trade barriers to protect domestic industries.
B) They promoted international capital flows and economic development.
C) They opposed the use of multinational corporations.
D) They discouraged global production models.
B) They promoted international capital flows and economic development.
What characterized the “global production” strategy in the 1980s?
A) Concentration of all production stages in low-wage countries.
B) Spreading different production stages across multiple countries for efficiency.
C) Exclusive reliance on advanced economies for all production.
D) Decentralization of management across domestic markets.
B) Spreading different production stages across multiple countries for efficiency.
What lesson did companies learn from the 1906 De Beers case in offshore finance?
A) To centralize control of business operations.
B) To move headquarters to avoid tax liabilities.
C) To invest in local economies to prevent regulation.
D) To comply with stricter British corporate laws.
B) To move headquarters to avoid tax liabilities.
