Module 1 Flashcards
Which term refers to the shift toward a more integrated and interdependent world economy?
Nationalism
Isolationism
Democracy
Globalization
Globalization
Renata is traveling across Europe and is surprised to find Starbucks, McDonald’s, and Coca-Cola in nearly every city she visits. This shows a convergence of consumer tastes, which creates a _____.
stock of FDI
mini-multinational
globalization of markets
globalization of production
globalization of markets
When Jerry started his small appliance manufacturing company in the 1950s, every component part was made in the United States and the product was assembled in the United States. Today, he sources the components from China. The change at this company is an example of the _____.
purchasing power parity
globalization of production
Sullivan principle
tragedy of the commons
globalization of production
The International Monetary Fund and the World Bank are both examples of _____ that help govern the global business system.
foreign markets
mini-multinationals
global institutions
federal mandates
global institutions
A U.S.-based shoe company has decided to invest in a British company that specializes in clasps and buckles. This would be an example of _____.
repatriation
market diversity
international trade
foreign direct investment
foreign direct investment
It is common practice for people today to use products that are produced or assembled in various nations around the world. This is a reflection of _____.
globalization
dynamism
nationalism
centralization
globalization
While lowering trade barriers initially made global production possible, the advent of technology made globalization a reality.
True false question.
True
False
True
The globalization of _____ is the term used to describe the merging of national markets into one large global place.
institutions
consumers
production
markets
markets
The doubling of the power of microprocessor technology while the costs of its production decreases by half is called ______ Law.
Skinner’s
Keyne’s
Maslow’s
Moore’s
Moore’s
Paragon Corp., based in Ohio, sources goods from Southeast Asia to take advantage of labor cost savings. This company is benefiting from _____.
domestic production
a franchise operation
intrastate investment
the globalization of production
the globalization of production
The ______ has developed into the information backbone of the global economy and reduced the constraints of location, scale, and time zone.
GATT
IMF
WTO
Internet
Internet
Global institutions are needed to _____.
shift economic power away from national governments
promote the raising of barriers to cross-trade and investment
prevent firms from offshoring their production activities
stabilize and monitor the global marketplace
stabilize and monitor the global marketplace
During the 1960s, which country was the predominant world power in terms of foreign direct investment?
The United States
China
The United Kingdom
Germany
The United States
Foreign direct investment occurs when a(n) _____.
investment is made by a company based in one country into a company or entity based in another country
firm exports goods or services to consumers in another country
stock holding is presented in both domestic and foreign currency
expatriate manager is sent to work in a foreign subsidiary but is directed by the home company
investment is made by a company based in one country into a company or entity based in another country
While the United States was the dominant industrial power in the early 1960s, by 2018, _____ took over that role.
Italy
China
France
Germany
China
Advances in information processing and communication are two ways _____ has made the globalization of markets a reality.
technology
media
logistics
production
technology
During the 1960s, U.S. firms created just over _____ of worldwide foreign direct investment and British firms were second accounting for just over 10 percent.
35 percent
65 percent
80 percent
20 percent
65 percent
Moore’s law predicts that
computer power will double every 18 months.
costs for production of microprocessors doubles continually.
software is getting slower more rapidly than hardware becomes faster.
software is surpassing hardware in terms of speed and efficiency.
computer power will double every 18 months.
A(n) ______ is any entity that conducts business in at least two countries.
multinational enterprise
conglomerate
intrastate corporation
transnational union
multinational enterprise
The first web browser was introduced to the public in the 1970s and started the explosive growth of the Internet in foreign transactions.
True false question.
True
False
False
Former communist nations present opportunities to Western international business as these nations show continued commitment to _____.
tyranny
monarchy
democracy
plutocracy
democracy
Select the four facts that described the demographics of the global economy up until the 1960s.
U.S. dominance in the world economy and world trade
Roughly half of the globe was off-limits to Western international business
U.S. dominance in world foreign direct investment
U.S. dominance in underdeveloped, third-world countries
U.S. retraction from all global agreements
The dominance of large, multinational U.S. firms in the international business scene
U.S. dominance in the world economy and world trade
Roughly half of the globe was off-limits to Western international business
U.S. dominance in world foreign direct investment
The dominance of large, multinational U.S. firms in the international business scene
Current trends indicate that, due to the emerging economies, the world is moving _____ an economic system that is more favorable for international business.
Multiple choice question.
further away from
closer to
closer to
In the early 1960s, the United States was the world’s dominant industrial power. How does the U.S. position compare today?
It has grown significantly in terms of industrial power.
It is the only nation to see a decrease in its industrial power.
It has about the same industrial power.
It has diminished industrial power.
It has diminished industrial power.
According to the supporters of globalization, falling barriers to international investment
restrict the formation of an integrated and interdependent global economy.
help to create employment opportunities in countries that participate in the global trading system.
will significantly raise the prices for goods and services.
will lower the incomes of consumers.
help to create employment opportunities in countries that participate in the global trading system.
As the barriers to the free flow of goods, services, and capital fell during the 1970s, one motivation for foreign direct investment by non-U.S. firms was the desire to
move production activities to more desirable locations.
decrease their shares of world output.
limit the use of communication technology.
raise the barriers to cross-border investments.
move production activities to more desirable locations.
Critics of globalization protest in order to
diminish the impact of the culture of multinational enterprises on the world.
lower the barriers to cross-border investments.
increase the number of enterprises that offshore their business activities.
encourage a shift toward a more integrated and interdependent global economy.
diminish the impact of the culture of multinational enterprises on the world.
Which of the following are notable trends in the demographics of multinational enterprises since the 1960s?
Multiple select question.
The growth of mini-multinationals
The decline of non-U.S. multinationals
The rise of non-U.S. multinationals
The decline of mini-multinationals
The growth of mini-multinationals
The rise of non-U.S. multinationals
According to the critics of globalization, which of the following are results of falling trade barriers?
Multiple select question.
The destruction of manufacturing jobs in advanced economies
Greater opportunities for manufacturing in developed countries
A reduction in the pool of global labor
A depression of wages in developed nations
The destruction of manufacturing jobs in advanced economies
A depression of wages in developed nations
The risks of doing business in countries that are facing revolutions are
not impacted by the threat of revolution.
lower than in countries not facing revolutions.
higher than in countries not facing revolutions.
the same as countries not facing revolutions
higher than in countries not facing revolutions.
Critics of globalization point out that free trade
allows firms to abuse the weak labor and environmental laws in developing countries.
minimizes pollution in the world’s poorer countries.
provides developed nations with a cost advantage over developing nations.
reduces job opportunities in developing nations where wages are much lower.
allows firms to abuse the weak labor and environmental laws in developing countries.
If you were to describe the global economy of the twenty-first century, it would be accurate to say that
more nations are becoming part of the developed world.
barriers to the free flow of goods have been increasing.
globalization limits a country’s movement toward greater economic development.
fewer nations are adopting liberal economic policies.
more nations are becoming part of the developed world.
One concern voiced by critics of globalization is that
with globalization, companies are likely to move their operations to countries with more stringent labor and environment regulations.
an interdependent global economy shifts economic power away from national governments and toward organizations such as the United Nations.
falling barriers to cross-border trade and investment reduce job opportunities in developing nations where wages are much lower.
globalization increases the wage rates of unskilled workers in advanced countries.
an interdependent global economy shifts economic power away from national governments and toward organizations such as the United Nations.
Influential economists, politicians, and business leaders who favor globalization argue that
falling barriers to international trade drive the economy toward greater prosperity.
increasing cross-border investment will increase the prices for goods and services.
raising barriers to international investments will increase job opportunities in developing nations.
lowering trade barriers decreases the incomes of consumers.
falling barriers to international trade drive the economy toward greater prosperity.
The division between rich and poor nations has _____________________
(increased or decreased) with the advent of globalization.
increased
Some demonstrations against globalization are based on the idea that falling barriers to international trade
result in job losses in industries targeted by foreign competitors.
reduce interdependency between countries.
reduce uniformity among national markets.
increase the choice of goods and services to consumers.
result in job losses in industries targeted by foreign competitors.
A(n) ______ business is any firm that engages in cross-border trade or investment.
transnational
intranational
supranational
international
international
