Long Exam 1 and 2 Questions

Question 1

It is the payment made to the holder of a copyright, trademark, patent, or other registration of intellectual property.

Answer 1

Royalty

Question 2

The index used to measure the performance of multinational companies in the international market.

Answer 2

S&P 500

Question 3

An economic system wherein the government intervenes in those sectors where it feels that private ownership is not in the best interest of society.

Answer 3

Mixed Economy

Question 4

T or F
The laws of countries governing intellectual property continue to converge by their membership in international organizations.

Answer 4

True

Question 5

T or F
The UNCLOS sets the exclusive economic zone at 370 miles.

Answer 5

False. 370 kilometers or 200 miles

Question 6

T or F
The government can take into state ownership troubled firms whose continued operation is felt to be vital to the national interest.

Answer 6

True

Question 7

T or F
The following pair of countries are in conflict with each other: North Korea and South Korea; Israel and Libya; Philippines and China.

Answer 7

False. Israel and Palestine

Question 8

T or F
Import restrictions are usually applied to the entire country and not just to a specific industry.

Answer 8

False. Import restriction is applied to the whole industry

Question 9

T or F
Among the less-developed countries, multi-nationalism of business is politically acceptable and economically desirable.

Answer 9

False. Multi-nationalism of businesses is prevalent among DEVELOPED countries.

Question 10

T or F
Sovereign states can exercise expropriation without compensation only when the subject company has violated domestic and/or international laws.

Answer 10

True

Question 11

T or F
Host country cannot control the profits and capital that an MNC can return to the parent company.

Answer 11

False. Exchange control

Question 12

T or F
RA 9252 defines the archipelagic baseline of the Philippines.

Answer 12

False. RA 9522

Question 13

T or F
The government of a country can impose control to prevent foreign companies from competing in certain markets.

Answer 13

True

Question 14

The Philippine Law which allows the use of electronic signatures in business transactions.

Answer 14

E-Commerce Act of 2000

Question 15

T or F
Once a business activity crosses national boundaries, it is called international business,

Answer 15

False. It should be legitimate business activity.

Question 16

T or F
A corporation is considered multinational when 30% of its profits are produced in foreign countries.

Answer 16

False. It should be more than 25% of its profits AND control operations in atleast six countries.

Question 17

T or F
Articles imported into a country are required to enter through a customhouse at the port of entry. However, items not subject to duty can be dispensed with this requirement.

Answer 17

False. All articles whether subject to duty or not are required to enter through a customhouse at the port of entry.

Question 18

T or F
Non-discriminatory principle means that a sovereign state may allow the operation of a foreign business in its economy as long as the country of origin of the firm also allows businesses from the state to operate there.

Answer 18

False. It should be Reciprocity Principle instead of Non-discriminatory Principle.

Question 19

T or F
All currencies can be traded and exchanged internationally.

Answer 19

False. Philippines only maintains 18 foreign currencies (countries who we have most transactions with) and 3 of the 18 FCs are freely convertible.

Question 20

The number of member-states of the United Nations

Answer 20

193 countries

Question 21

Goods which entered a country outside of the ports of entry.

Answer 21

Sumggled goods

Question 22

Currencies which have a fairly wide acceptance for the settlement of international obligations and are used as a medium of international transactions.

Answer 22

Freely convertible currencies

Question 23

The number of countries comprising the ASEAN.

Answer 23

11 countries

Question 24

A situation wherein two or more related companies sell products to each other at prices that will allow them to get some tax benefits.

Answer 24

Transfer Pricing

Question 25

The risk that MNCs have to deal with because of the fluctuations in exchange rates.

Answer 25

Business Risk

Question 26

T or F
The three largest markets in the world are the US, China, and Japan.

Answer 26

False. It is North America, Asia, and Europe.

Question 27

T or F
Freely convertible currency can be used by two countries in settling their transactions even if that particular currency is not the home currency of either country.

Answer 27

True

Question 28

T or F
Ease of doing business indicates a country’s openness to multinational companies.

Answer 28

True

Question 29

T or F
In Philippine Economic Zones, MNC enjoy tax holidays.

Answer 29

True

Question 30

T or F
Businesses doing exporting or importing are considered multinational companies.

Answer 30

False. To be considered a MNC, it should be independent and self-sufficient.

Question 31

T or F
All currencies can be traded and exchange intentionally.

Answer 31

False. Philippines only maintains 18 FCs where 3 of it are freely convertible.

Question 32

T or F
A product is considered dumped if the price is much lower than the price of similar local goods.

Answer 32

True

Question 33

T or F
Tesla, the company of the current richest man in the world, Elon Musk, is the largest multinational company in the world in terms of market capitalization.

Answer 33

False. It is Apple.