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Homework answers / question archive / The College at Brockport BUS 345 Quiz 4: 1)A(n)__is the greatest extent of national integration
The College at Brockport
BUS 345
Quiz 4:
1)A(n)__is the greatest extent of national integration.
a) Economic union
b) Common market
c) Political union
d) Customs union
2) All of the following factors of production are intentional mobile EXCEPT .
a) Labor
b) Financial capital
c) Capital equipment
d) Land
3) The purchase of physical assets or s significant amount of ownership of a company in another country to gain a measure of management control is called .
a Foreign direct investment b Portfolio investment
c Mergers
d Vertical integration
4) Which of the following are main drivers of foreign direct investment?
a) Diversity and telecommunications
b) Telecommunications and transportations
c) Globalization and mergers and acquisitions
d) Diversity and globalization
5) When companies realize they could produce in the most efficient and productive locations in the world and simply export to markets worldwide, a new surge of foreign direct investment flowed into
a Low cost newly industrialized nations and emerging markets b Highly developed economies
c The automobile and computer industries d Totalitarian and theocratic nations only
6) Companies seek cross-border mergers and acquisitions to
a) Get a foothold in new geographic markets
b) Increase a firm’s global competitiveness
c) Fill in hap in companies’ product lines in a global industry
d) All of the above
7) Economic integration whereby countries remove all barriers to trade among themselves, but each country determined its own barriers against nonmembers I called a(n) .
a) Economic union
b) Customs union
c) Common market
d) Free-trade area
8) Which of the following statements is NOT true?
a) Entrepreneurs and small businesses do not play an important role in expanding foreign direct investment flows
b) Increasing globalization is causing a growing number of international companies from emerging markets to undertake foreign direct investment
c) The desire to increase a firm’s global competitiveness drives many cross-border mergers and acquisitions
d) Companies may pursue mergers and acquisitions to fill gabs in their product lines
9) Which of the following is NOT one of the four main theories that attempts to explain why companies engage in foreign direct investment?
a) International product life cycle theory
b) Market imperfections theory
c) Eclectic theory
d) Mercantilism
10) Which of these refers to the theory that a company ill begin by exporting its products and later undertake foreign direct investment as a product moves through its life cycle?
a) Eclectic life cycle
b) Market imperfections life cycle
c) International product life cycle
d) Market power life cycle
11) According to the international product life cycle in which of the following stages is a good produced in the home country because of uncertain domestic demand and to keep production close to the research department?
a) Standardized product stage
b) Maturing product stage
c) Declining product stage
d) New product stage
12) In the product stage of the international product life cycle theory, increased competition pressures a company to product in low-costing developing nations.
a) New
b) Maturing
c) Standardized
d) Declining
13) A market that is said to operate at peak efficiency and where goods a re readily and easily available is said to be a(n) .
a) Perfect market
b) Eclectic market
c) Imperfect market
d) Greenfield market
14) The theory states that when an imperfection in the market makes a transaction less efficient than it could be, a company will undertake foreign investment to internalize the transaction and thereby remove the imperfection.
a) Market power
b) Perfect market
c) International product life cycle
d) Market imperfections (internalization)
15) The requirement that a sufficient portion of a product’s content originate within a certain market to escape tariff charges is an example of a(n)
a) Perfect market
b) Market imperfection
c) Tariff quotas
d) Maturing product
16) The theory states that firms undertake foreign direct investment when the features of a particular location combine with ownership and internalization advantages to make a location appealing for an investment.
a) Internalization
b) International product life cycle
c) Marker imperfections
d) Eclectic
17) Which of these theories states that firms undertake foreign direct investment when the features of a particular location combine with ownership and internalization advantage to make a location appealing for investment?
a) Market power
b) International product life cycle
c) Market imperfections
d) Eclectic
18) A(n) is the advantage of locating a particular economic activity in a specific location because of the characteristics of that location.
a) Industry advantage
b) Production advantage
c) Comparative advantage
d) Location advantage
19) A(n) is the advantage that arises from internalizing a business activity rather than leaving it to a relative inefficient market.
a) Ownership advantage
b) Internalization advantage
c) Location advantage
d) Market power advantage
20) According to the eclectic theory, which of the following advantages must be present for a company to undertake foreign direct investment?
a) Location
b) Ownership
c) Internalization
d) All of the above
21) One way a company can achieve market power is through
a) Ownership advantages
b) Horizontal integration
c) Vertical integration
d) Balancing payments
22) Regionalism .
a) Is the process whereby countries in a geographic region cooperate with one another to reduce or eliminate barriers to the international flow of product, people or capital
b) Should increate cross border trade
c) Should raise living standard in participating nations
d) All of the above
23) Nations undergoing economic integration desire to .
a) increase cross border investment
b) raise living standard for their people
c) increase cross border trade
d) all of the above
24) which of the following is NOT a goal of regional economic integration?
a) Protection of intellectual property rights
b) Protection of the environment
c) Creation of a political union
d) Lowering cross border investment
25) Which of the following refers to investment that do NOT involve obtaining a measure of control in a company?
a) Foreign direct investment
b) Portfolio investment
c) Mergers
d) Vertical integration
26) Which of the following is the lowest extent of national integration?
a) Free-trade area
b) Political union
c) Common market
d) Customs union
27) Which of these created renewed determination to further reduce barriers to trade?
a) Consumer demand
b) Advancements in telecommunications
c) Foreign direct investment and portfolio investment trends
d) Uruguay Round of trade negotiations
28) Economic integration whereby countries remove all barriers to trade among themselves, but erect common trade policy against nonmembers is called a(n) .
a) Economic union
b) Customs union
c) Common market
d) Free trade area
29) The main difference between a free trade area and a customs union is that the members of a customs union .
a) Agree to trade with all nonmember nations in a similar manner
b) Agree to the free movement of all factors of production
c) Harmonize their tax, monetary, and fiscal policies and create a common currency
d) Accept a common stance on economic and political policies regarding nonmember nations
30) Economic integrations whereby countries remove all barriers to trade and the movement of labor and capital between themselves but erect a common trade policy against nonmembers is called a(n) .
a) Economic union
b) Customs union
c) Common market
d) Political union
31) Which of the following is best classified as an economic union?
a) Southern Common Market (MERCOSUR)
b) European Union (EU)
c) North American Free Trade Agreement (NAFTA)
d) Andean Community
32) Economic integration whereby countries remove barriers to trade and the movement of labor and capital, erect a common trade policy against nonmembers, and coordinate their economic policies is called a(n) .
a) Customs union
b) Common market
c) Economic union
d) Free-trade area
33) The increase in the level of trade among nations that results from regional economic integration is called
a) Trade diversion
b) Trade restriction
c) Trade creation
d) Trade embargo
