San Francisco State University

IBUS 330

International Business: The Challenges of Globalization, 7e (Wild)

Chapter 1  Globalization

1)International business is any commercial transaction that crosses the borders of two or more nations.

 

 

2. Imports are goods and services purchased abroad and brought into a country.

 

3. Multinational corporations (MNCs) have direct investments abroad in multiple countries.

 

4. A born global firm is a company that engages in international business from or near its inception.

 

 

5. The term "globalization of production" refers to convergence in buyer preferences in markets around the world.

 

 

6. Products marketed in all countries essentially without any changes are known as continental products.

 

 

7. The General Agreement on Tariffs and Trade (GATT) was designed to promote free trade by reducing both tariffs and nontariff barriers to international trade.

 

 

8. The power of the General Agreement on Tariffs and Trade (GATT) to settle trade disputes is what sets it apart from the World Trade Organization (WTO).

 

 

9. The World Trade Organization's dispute settlement system has the ability to penalize offending nations.

 

 

10. NAFTA is the international organization that enforces the rules of international trade worldwide.

 

 

11. Resistance to worldwide trade agreements has resulted in some nations placing greater emphasis on regional pacts.

 

 

12. Gross national product (GNP) is the value of all goods and services imported into a country over a one-year period.

 

13. Extranets give distributors and suppliers access to a company's database to place orders or restock inventories electronically.

 

 

14. A characteristic of the world's least-global nations is low levels of corruption.

 

15. The role of the World Bank is to provide financing for national economic development efforts.

 

 

16. The rules of the international monetary system are enforced by the World Bank.

 

17. Critics of globalization argue that it eliminates jobs in developing nations.

 

18. Pro-globalization economists believe globalization increases wealth in both developed and developing nations.

 

 

19. Flexible labor markets allow workers to be redeployed rapidly to sectors of the economy where they are highly valued.

 

 

20. Supporters and critics of globalization appear to agree that globalization prevents dislocation in labor markets.

 

 

21. Critics of globalization believe the overall gains that accrue to national economies are worth the lost livelihoods of some workers.

 

 

22. Export-processing zones are special areas in which companies engage in tariff-free importing and exporting.

 

 

23. Research shows that pollution-intensive U.S. companies tend to invest in nations with lenient environmental standards.

 

 

24. International firms tend to support reasonable labor and environmental laws to expand future local markets for their businesses.

 

 

25. Small businesses will be completely immune to events in the international business environment.

 

26. Any commercial transaction that crosses the borders of two or more nations is known as

                     .

27. Goods and services purchased abroad and brought into a country are called                              .

 

28.                        are all goods and services sold abroad and sent out of a country.

 

29. Olive oil prepared in a small Italian oil press factory and sold by large supermarkets in the United States is an example of a                                                                   .

 

30. Which of the following terms applies to the sale of a particular brand of jeans manufactured in the U.S. and sold in Canadian stores?

 

31. A business that has direct investments (in the form of marketing or manufacturing subsidiaries) abroad in several countries is called a                                                        .

 

32. The rise of a new international entity called the                             suggests that any company,

regardless of age, experience, and resources, can engage in international business.

 

33. Small companies selling traditional products benefit from                               .

 

34.                        is an effective alternative to traditional distribution channels for firms that sell digitized products.

 

35.                        is the trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies.

 

36. Globalization is characterized by                            .

 

37. As a result of globalization, Argonia finds that its national borders are becoming less relevant. This indicates that Argonia is undergoing                                                          .

38. The term                         refers to entities cooperating across national boundaries.

 

39. Which of the following refers to convergence in buyer preferences in markets around the world?

 

40. Which of the following refers to the use of computer networks to purchase, sell, or exchange products; service customers; and collaborate with partners?

 

41. Gentian Violet is a dye manufacturing company that uses computer networks to sell its products, service customers, and collaborate with partners. Which of the following technologies is the company engaging in this scenario?

 

42. Development that meets the needs of the present without compromising the ability of future generations to meet their own needs indicates                                       .

 

43. Most companies today operate in an environment of increased transparency and scrutiny regarding their business activities. This is due to                                                             .

 

44. An established consumer market that primarily comprises the middle class and possesses efficient infrastructure is characteristic of                                               markets.

 

45.                        markets are characterized by the rural population migrating to cities for better pay and thus, overloading cities' infrastructures.

 

46. Konesia is a country in which rising incomes are increasing the global demand for basic products and services. Which of the following is the type of market featured in this country?

 

47. The population of a(n)                           market is mostly rural and is characterized by poor infrastructure with little credit or collateral.

 

48. Kireki is a small country with a corrupt government. Its population is rural for most part and citizens have few or no legal rights. Which of the following is the type of market featured in Kireki?

 

49.                        is defined as the dispersal of production activities to locations that help a company achieve its cost-minimization or quality-maximization objectives for a good or service.

50. Which of the following is an example of globalization of production?

 

51. Whereas relocating production to low-cost locales traditionally meant production of goods almost exclusively, it increasingly applies to the production of                                                            .

 

52. Two major forces that underlie the expansion of globalization are falling barriers to trade and investment, and .

 

53. As former competitors in many industries link up to challenge others on a worldwide basis,              occurs.

 

54. The purpose of the General Agreement on Tariffs and Trade (GATT) was to                                .

 

55.                        place limits on the quantity of a product being imported.

 

56. A major flaw of the original General Agreement on Tariffs and Trade (GATT) was that it lacked the power to        .

 

57. The                        replaced the institution of GATT while retaining all of the former GATT agreements.

 

58. The three main goals of the World Trade Organization (WTO) are to help the free flow of trade, help negotiate the further opening of markets, and                                                 .

 

59. Some nations encourage                          because of recent resistance to worldwide trade agreements.

 

60. The value of all goods and services produced by a country's domestic and international activities over a one-year period is the country's                                                            .

 

61. Crystal inc. is a multifaceted company that deals with the mining, cutting, and selling of diamonds. It gives distributors and suppliers access to its database to place orders or restock inventories electronically and automatically. Which of the following is the network implemented in the company?
62. The KOF Index measures the                           .

 

63. The                        is an agency created to provide financing for national economic

development efforts.

 

64. Which of the following was created to regulate fixed exchange rates and enforce the rules of the International monetary system?

 

65. According to the opponents of globalization, which of the following occurs as a result of worker dislocation brought about by globalization?

 

66. Opponents argue that globalization                          .

 

67. Globalization is criticized because it                              .

 

68. Supporters affirm that globalization                           .

 

69. Which of the following terms is used to refer to widespread job turnover throughout an economy?

 

70. Trade unions claim that by permitting international firms to continually move to nations with           , globalization reduces labor's bargaining power and forces overall labor standards lower.

 

71. A special region in which companies can engage in tariff-free importing and exporting is called a(n)               .

 

72. To minimize the economic inequality within developing nations, studies suggest that the nations can boost incomes of their poorest citizens by                                                                 .

 

73. Which of the following statements is  of developing countries that have embraced globalization?

 

74. Critics of globalization say that global consumer-goods companies destroy                                  .

 

75. Globalization tends to foster two important values, tolerance and                             .

 

76. Each                         is composed of unique cultural, political, legal, and economic characteristics that define business activity within that nation's borders.

77.                        involves the idea that a nation-state is autonomous, cannot intervene in the affairs of other nations, and can enter into binding international agreements.

 

78. The global business environment consists of four distinct elements: the forces of globalization, national business environments, the international business environment, and

                     .

 

79. Which of the following actions can be adopted by developed nations to lessen the negative effects of globalization?

 

 

80. Topsy Turvey Toys buying its merchandise from Ureshi Toys is an example of                                    .

 

81. Ureshi Toys selling its products to Topsy Turvey Toys is an example of                                    .

 

82. The products that Ureshi Toys manufactures are examples of                             .

 

83. Ureshi Toys is an example of a(n)                            .

 

 

84. Jeans Unlimited manufactures its clothing at facilities located in two Southeast Asian countries. The dispersal of manufacturing activities by the company indicates                                                              .

 

85. Which of the following arguments against globalization, if , could be made using Jeans Unlimited as an example?

 

86. Jeans Unlimited plans to set up new facilities that are designed specifically to reduce impact on the environment. The management has emphasized on recycling and reusing most of their resources. What concept is the company emphasizing on in this scenario?

 

 

87. Which of the following statements, if , strengthens Donna's argument?

 

88. Which of the following statements, if , weakens her argument?

 

89. Upon what assumption does Donna's conclusion rest? Donne assumes that                                                         .

 

90. Her argument is vulnerable to criticism because it fails to                               .

 

91. Summarize each benefit a company might obtain from the globalization of markets.

 

92. How might a company benefit from the globalization of production?

 

93. Identify the World Trade Organization's (WTO) three main goals and explain how the WTO differs from the General Agreement on Tariffs and Trade (GATT).

 

94. One argument in the debate surrounding globalization is about the inequality between nations. Discuss the major points of the inequality between nations argument and describe how falling barriers to trade and investment might help reduce the inequality between nations.

 

95. Compare and contrast the purposes of the World Bank and the International Monetary Fund.

 

96. Globalization's impact on jobs and wages is an important topic for debate. Discuss the major points for globalization in the jobs and wages debate, and describe how the actions of large multinational corporations affect the issues in the jobs and wages debate.

 

97. Explain how technological innovation has benefitted entrepreneurs.

 

98. Describe key characteristics of a born global firm, and explain why a born global firm would be attuned to international firm management.

 

99. Explain globalization of production and its benefits. Why should a company study