Deck 3: International Business in Context

Question 1

The volume of world trade has grown _______ than world GDP since 1960

A) At a similar rate
B) slower
C) faster
D) contracted

Answer 1

C
Explanation: The volume of world trade has increased faster that world GDP since 1960. World trade as a percentage of world GDP increased from 24% in 1960 to 58% in 2015.

Question 2

Protectionism argues the case for _______ to insulate an economy

A) Selective measures
B) A total ban on trade
C) Government ownership of trade affected industries
D) Higher taxes in export sectors overseas

Answer 2

A
Explanation: Protectionism argues for selective measure in the import-affected country

Question 3

A global world economy is one that is _______

A) Likely to be dominated by a hegemonic power
B) Likely to bring a loss of political freedom
C) Likely to mean lower living standard
D) Likely to be more integrated and interdependent

Answer 3

D
Explanation: All that we can say with a high degree of certainty is d. , a higher degree of integration and interdependency. Whether there is a loss of political freedom, lower living standards or domination, depends critically on the precise form of globalisation and some of these developments are unlikely.

Question 4

World Trade Organization (WTO) include the membership of

A) China
B) Russia
C) North-Korea
D) France

Question 5

International business today is predominantly the domain of large, multinational enterprises

Question 6

World trade is the only indicator of the growth of IB

Question 7

Convergence of markets is probably more developed in B2B than in B2C industries.

Question 8

Free trade exists when a government does not restrict what its citizens can buy or sell to another country

Question 9

Vertical FDI means that a firm operates at a different stage of the value chain, either upstream or downstream, in an overseas location.

Question 10

The relative economic decline of the United States reflects the growing economic development and industrialisation of the world economy, as opposed to any absolute decline in the overall health of the U.S. economy

Question 11

Competition increases with globalisation

Question 12

Intra-firm trade involves trade between affiliates and headquarter

Question 13

Complex management issues are related to large MNEs with long supply chians

Question 14

Domestic economic reform is likely to impact both inward and outward foreign direct investment (FDI)

Question 15

Dynamism is a sought after capability in Global factory managers

Question 16

Containerisation and the efficiency gains it brings, is a major reason for declining international transport costs

Question 17

Trade liberalisation is now so entrenched it cannot be reversed

Question 18

Complexity is a characteristic of MNEs operating in today's market economies

Question 19

Horizontal FDI or horizontal integration occurs when a company duplicates home country activities at the same stage of the value chain in an overseas location.