Chapter 5

Question 1

global vision

Answer 1

recognizing and reducing to international marketing opportunities, using effective global marketing strategies, and being aware of threats from foreign competitors in all markets

Question 2

global marketing

Answer 2

marketing that targets markets throughout the world

Question 3

multinational corporation

Answer 3

company that is heavily engaged in international trade, beyond exporting and importing

Question 4

multinational corporation

Answer 4

a company that is heavily engaged in international trade, beyond exporting and importing

Question 5

capital intensive

Answer 5

using more capital than labor in the production process

Question 6

global marketing standardization

Answer 6

production of uniform products that can be sold the same way all over the world

Question 7

European Union

Answer 7

a free trade zone encompassing 27 European countries

Question 8

mercosur

Answer 8

the largest latin american trade agreement; includes argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Paraguay, Peru, Uruguay, and Venezuela

Question 9

Uruguay Round

Answer 9

an agreement to dramatically lower trade barriers worldwide; created the World Trade Organization

Question 10

tariff

Answer 10

a tax levied on the goods entering a country

Question 11

quota

Answer 11

a limit on the amount of a specific product that can enter country

Question 12

boycott

Answer 12

exclusion of all products from a certain country

Question 13

exchange control

Answer 13

a low compelling a company earning foreign exchange from its exports to sell it to ta control agency, usually a central bank

Question 14

World Trade organization

Answer 14

a trade organization that replaced the old General Agreement on Tariffs and Trade

Question 15

General Agreement on Tariffs and Trade

Answer 15

a trade agreement that contained loopholes that enabled countries to avoid trade barrier reduction agreements

Question 16

North American Free Trade Agreement

Answer 16

an agreement between Canada, the United States, and Mexico that created the world’s largest free trade zone

Question 17

central america free trade agreement

Answer 17

a trade agreement, instituted in 2005, that includes Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and the United States

Question 18

World Bank

Answer 18

an international bank that offers low interest loans, advice and info to developing nations

Question 19

international monetary fund

Answer 19

an international organziation that acts as a lender of last resort, providing loans to troubled nations, and also works to promote trade through financial cooperation

Question 20

exporting

Answer 20

selling domestically produced products to buyers in another country

Question 21

buyer for export

Answer 21

an intermediary in the global market that assumes all ownership risks and sells globally for its own account

Question 22

export broker

Answer 22

an intermediary who plays the traditional broker’s role by bringing buyer and seller together

Question 23

export agent

Answer 23

an intermediary who acts like a manufacturer’s agent for the exporter. The export agent lives in the foreign market

Question 24

licensing

Answer 24

the legal process whereby a licensor agrees to let another firm use its manufacturing process, trademarks, patents, trade secrets, or other proprietary knowledge

Question 25

contract manufacturing

Answer 25

private label manufacturing by a foreign company

Question 26

joint venture

Answer 26

when a domestic firm buys part of a foreign company or joins with a foreign company to create a new entity

Question 27

direct foreign investment

Answer 27

active ownership of a foreign company or of overseas manufacturing or marketing facilities

Question 28

floating exchange rates

Answer 28

prices of different currencies move up and down based on the demand for and the supply of each currency

Question 29

dumping

Answer 29

the sale of an exported product at a price lower than that charged for the same or a like product in the “home” market of the exporter

Question 30

countertrade

Answer 30

a form of trade in which all or part of the payment for good or services is in the farm of other goods or services