Deck 9: Economic Development and the Americas

Question 1

Mercosur is a free trade group formed by the United States of America.

Answer 1

False
Explanation: Mercosur is a free trade group formed by Argentina, Brazil, Paraguay, and Uruguay.

Question 2

The quality of an infrastructure directly affects a country's economic growth potential.

Answer 2

True
Explanation: The quality of an infrastructure directly affects a country's economic growth potential and the ability of an enterprise to engage effectively in business. Infrastructure is a crucial component of the uncontrollable elements facing marketers.

Question 3

In static economies, consumption patterns change rapidly.

Answer 3

False
Explanation: In static economies, consumption patterns become rigid, and marketing is typically nothing more than a supply effort. In a dynamic economy, consumption patterns change rapidly."

Question 4

The trend toward privatization is currently a major economic phenomenon in industrialized as well as in developing countries.

Question 5

High transaction costs associated with the use of the Internet prevents smaller firms in emerging countries from selling into a global market.

Question 6

The newly industrialized countries have per capita incomes lower than LDCs or MDCs.

Question 7

Economic growth is measured solely in economic goals.

Question 8

The level of political stability in a country is the single most important environmental element to which the foreign marketer must adjust the marketing task.

Question 9

Brazil is a fully industrialized country.

Question 10

Considering the United Nations' stages of economic development for classifying countries with respect to levels of industrialization, Brazil falls under the group of more-developed countries (MDCs).

Question 11

The more developed an economy, the lesser the variety of marketing functions demanded.

Question 12

When the only marketing functions performed are demand creation and physical distribution, the marketing process is said to be in the mass distribution substage.

Question 13

The presence of large, accessible markets with low tariffs has contributed to the economic growth of newly industrialized countries (NICs).

Question 14

Economic development means rapid economic growth and increases in consumer demand.

Question 15

The liberalization of trade and investment policies in developing countries is changing the way countries will trade and prosper in the 21^st century.

Question 16

The UN classification has been criticized because it no longer seems relevant in the rapidly industrializing world.

Question 17

Privatization of industries released immediate capital to invest in strategic areas.

Question 18

Among three kinds of distances that international marketers must traverse, time zones have the greatest influence on the success of their commercial efforts abroad.

Question 19

According to the UN classification, industrially developing countries just entering world trade with relatively low per capita incomes are referred to as least-developed countries.

Question 20

The marketing process substage in the United States economy from 1950 to the present is mass production.

Question 21

_____ refers to an increase in national production that is reflected by an increase in the average per capita gross domestic product (GDP) or gross national income (GNI).

A) Economic repression
B) Economic duress
C) Economic equilibrium
D) Economic development
E) Economic sustainability

Question 22

Which of the following is considered as the single most important environmental element of a country to which the foreign marketer must adjust the marketing task?

A) Political stability
B) Economic level
C) Social norms
D) Literacy level
E) Cultural orientation

Question 23

____ classifies a country's stage of economic development on the basis of its level of industrialization into three categories and the three categories are MIDCs, LDCs, and LLDCs.

A) The U.S. Department of Commerce
B) The North Atlantic Treaty Organization
C) The International Organization for Standardization
D) The United Nations
E) The World Trade Organization

Question 24

Mercosur is the largest common-market agreement in the Americas.

Question 25

According to the United Nations' stages of economic development for classifying countries with respect to levels of industrialization, which category does an industrialized country with high per capita income fall under?

A) Less-developed countries.
B) Least-developed countries.
C) More-developed countries.
D) Newly industrialized countries.
E) Pre emerging markets.

Question 26

Big emerging markets are of major political importance within their regions.

Question 27

Which of the following is NOT one of the factors changing the way countries trade and prosper in the twenty-first century?

A) The transition from socialist to market-driven economies.
B) Liberalization of trade and investment policies in developing countries.
C) The transfer of public-sector enterprises to the private sector.
D) The rapid development of regional market alliances.
E) The expansion of military interventions around the world.

Question 28

What is occurring in the BEMs is analogous to the situation after World War II when tremendous demand was created during the reconstruction of Europe.

Question 29

The DR-CAFTA includes a wide array of tariff reductions aimed at increasing trade and employment.

Question 30

Uruguay is a member of NAFTA.

Question 31

The Mercosur envisioned central institutions similar to those of the European Union institutions.

Question 32

Which of the following statements is true regarding MDCs (more-developed countries)?

A) These countries are just entering world trade.
B) Majority of its population stay in rural areas.
C) These countries have high per capita incomes.
D) These countries have little world trade involvement.
E) These countries have mainly agrarian economies.

Question 33

When the marketing process in a country is in the commercial transition substage, the only marketing function performed is physical distribution.

Question 34

Which of the following is a fully industrialized country?

A) Brazil
B) Russia
C) Germany
D) Argentina
E) China

Question 35

One of the most important aspects of LAIA that differs from LAFTA is the differential treatment of member countries according to their level of economic development

Question 36

The United States-Canada Free Trade Area (CFTA) was a customs union like the European Community.

Question 37

Dynamic economies differ from static economies in that dynamic economies:

A) need not match marketing efforts with the market needs and wants.
B) have rapidly changing consumption patterns.
C) have rigid consumption patterns.
D) define marketing as typically nothing more than a supply effort.
E) do not require the marketer to be prepared for economic shifts and emerging markets.

Question 38

As a country develops, market behavior changes and eventually it leads to market segmentation.

Question 39

Canada is classified under the category of _____.

A) third world countries
B) least-developed countries
C) more-developed countries
D) newly industrialized countries
E) pre-emerging countries

Question 40

According to the United Nations' stages of economic development for classifying countries with respect to levels of industrialization, _____ consist of industrially developing countries just entering world trade with relatively low per capita income.

A) first world countries
B) least-developed countries
C) less-developed countries
D) newly industrialized countries
E) more-developed countries

Question 41

Economic planners are often more _____ oriented than marketing oriented.

A) production
B) human resource
C) logistics
D) theory
E) distribution

Question 42

Paved roads, railroads, seaports, communication networks, and financial networks are illustrations of _____.

A) environmental resources
B) inventory
C) infrastructure
D) factors of production
E) logistics

Question 43

Which of the following is true about privatization of state-owned enterprises?

A) It results in a drain on national budgets.
B) It blocks investment of capital in strategic areas.
C) It often leads to modernization.
D) It results in a draining of the future national resources.
E) It increases the number of state-owned enterprises.

Question 44

Which of the following is NOT a factor that has contributed to the rapid economic growth of NICs (newly industrialized countries)?

A) Political stability.
B) Well-established economic and legal reforms.
C) Rapid increase in population.
D) Outward orientation.
E) Entrepreneurship.

Question 45

During the early growth of many countries, the first large open market was _____.

A) China
B) China
C) Australia
D) Germany
E) India

Question 46

When countries sell off state-owned enterprises, it usually results in a(n):

A) surge in household expenditure.
B) decline in productivity throughout the private sector.
C) release of capital to invest elsewhere.
D) change in political leadership.
E) increase in unemployment rate.

Question 47

Which of the following is true about the present state of foreign businesses in most developing countries?

A) Foreign investors are seen as vital partners in economic development.
B) Most developing countries discourage or forbid foreign investment.
C) Multinational firms are expropriated and charged with excessively high tariffs and quotas.
D) Foreign investors are considered exploiters of resources.
E) Foreign investment is banned in most developing countries.

Question 48

Privatization of state-owned enterprises results in _____.

A) a decline in productivity throughout the private sector
B) a surge in household expenditure
C) the release of capital to invest in strategic areas
D) a change in political leadership
E) reduced modernization

Question 49

Most newly industrialized countries (NICs) have moved away from restrictive trade practices and instituted significant free market reforms. As a result these countries have:

A) attracted both trade and foreign direct investment.
B) overcome environmental damages caused by lack of development.
C) reduced population pressures through labor outsourcing.
D) obtained significant amount of loans from World Bank.
E) taken measures to protect their cultures and traditions.

Question 50

Economic planners are most likely to be least concerned with the problems related to _____.

A) production
B) finance
C) expenditure
D) distribution
E) investment

Question 51

Which of the following countries was involved in the formation of the free trade group Mercosur?

A) Australia
B) China
C) Argentina
D) Russia
E) Thailand

Question 52

In which of the following countries is the literacy rate 100 percent?

A) Mexico
B) Canada
C) Colombia
D) Argentina
E) Peru

Question 53

Which of the following statements is true regarding the Internet?

A) The Internet increases the economically optimal size for firms.
B) The Internet increases the transaction costs.
C) The Internet allows for innovative services but at a relatively higher cost.
D) The Internet enables smaller firms in emerging economies to sell into a global market.
E) The Internet increases the economies of scale from vertical integration.

Question 54

_____ is a free trade group formed by Argentina, Brazil, Paraguay, and Uruguay.

A) NAFTA
B) Caricom
C) Mercosur
D) SACU
E) DR-CAFTA

Question 55

Newly industrialized countries (NICs) differ from less-developed countries in that NICs:

A) include Canada, the United States and Germany.
B) are similar to more-developed countries.
C) have per capita incomes that are lower than other developing countries.
D) have moved away from restrictive trade practices and instituted significant free market reforms.
E) have shown slow industrialization and expansion of targeted industries.

Question 56

The United Nations' classification of stages of economic development has been criticized because it:

A) no longer seems relevant in the rapidly industrializing world.
B) does not take into consideration the level of political stability in a country.
C) does not take into consideration the per capita income level of a country.
D) only focuses on the literacy level in a country.
E) does not take into consideration the level of industrialization of a country.

Question 57

According to the United Nations' stages of economic development for classifying countries with respect to levels of industrialization, a country that is industrially underdeveloped, agrarian, has subsistence society with rural populations and extremely low per capita income levels falls under the category of _____.

A) first world countries
B) least-developed countries
C) less-developed countries
D) newly industrialized countries
E) big emerging markets

Question 58

Most newly industrialized countries (NICs) have moved away from restrictive trade practices and instituted significant free market reforms. As a result these countries have:

A) attracted both trade and foreign direct investment.
B) overcome environmental damages caused by lack of development.
C) reduced population pressures through labor outsourcing.
D) obtained significant amount of loans from World Bank.
E) taken measures to protect their cultures and traditions.

Question 59

Which of the following is an indicator of economic development?

A) Population expansion.
B) Expanding state ownership.
C) Extent of social overhead capital.
D) Social reformation.
E) Cultural diversity.

Question 60

Chile, Brazil, Mexico, South Korea, Singapore, and Taiwan are _____ countries.

A) least-developed
B) kinetically-developing
C) parallel-developed
D) newly industrialized
E) rapid-growth

Question 61

_____ is an economy's arbitrator between productive capacity and consumer demand.

A) Warehousing
B) Marketing
C) Convergence
D) Procurement
E) Outsourcing

Question 62

When the marketing process is characterized by mass distribution, all of the following marketing functions are performed EXCEPT _____.

A) demand creation
B) market information analysis
C) physical distribution
D) exchange
E) market and product planning, development

Question 63

If a market is characterized as being geographically large, has significant population, is a regional economic driver, and has undertaken significant programs of economic reform, the market is classified as a(n) _____.

A) two-sided market
B) contestable market
C) captive market
D) niche market
E) big emerging market

Question 64

Markets that are geographically large, have strong growth rates, are regional economic drivers and represent sizable markets for a wide range of products are known as _____.

A) captive markets
B) big emerging markets
C) niche markets
D) contestable markets
E) two-sided markets

Question 65

Identify the substage in the evolution of the marketing process, when the only marketing functions performed are demand creation and physical distribution.

A) Mass production
B) Global distribution
C) Self-sufficient
D) Surplus commodity product
E) Small scale

Question 66

According to the evolution of the marketing process, when the only marketing functions performed are demand creation, physical distribution, and market information analysis, the marketing process is in the _____ substage.

A) mass production
B) commercial-transition
C) self-sufficient
D) surplus commodity product
E) small scale

Question 67

Which of the following substages best characterizes the United States today with respect to the evolution of the marketing process?

A) Mass production
B) Commercial-transition
C) Self-sufficiency
D) Surplus commodity product
E) Mass distribution

Question 68

All of the following are traits of big emerging markets (BEMs) EXCEPT:

A) they import less than smaller markets.
B) they are all physically large.
C) they have significant populations.
D) they are regional economic drivers.
E) they are of major political importance within their regions.

Question 69

Alexia is geographically large and represents a sizable market for a wide range of products. It has a potential for significant growth. It is considered as the regional economic driver. Based on this information, Alexia can be classified as a(n) _____.

A) contestable market
B) big emerging market
C) two-sided market
D) captive market
E) niche market

Question 70

Which of the following countries is a part of the free trade area known as CFTA?

A) France
B) Uruguay
C) The United States
D) Argentina
E) Brazil

Question 71

The marketing process in the U.S between 1885 to 1914 mainly focused on _____.

A) mass distribution
B) self-sufficiency
C) mass production
D) surplus commodity product
E) commercial-transition

Question 72

A market in which the only marketing function performed is exchange is most like to be classified under the _____ stage.

A) surplus commodity product
B) commercial-transition
C) mass production
D) mass distribution
E) self-sufficient

Question 73

Which of the following is true of the CFTA?

A) It was designed to eliminate trade barriers between the United States, Canada, and parts of Asia.
B) It created several, independent commercial markets for goods and services.
C) It was a customs union like the European Community.
D) It involved economic and political unions.
E) It provided only for the elimination of tariffs and other trade barriers between the United States and Canada.

Question 74

The three members of the North American Free Trade Agreement (NAFTA) are:

A) The United States, the United Kingdom, and France.
B) The United States, Cuba, and Uruguay.
C) Canada, China, and Japan.
D) The United States, France, and Germany.
E) Canada, Mexico, and the United States.

Question 75

The transitional sector differs from the modern urban sector in that the transitional sector:

A) is an exclusively agriculture-oriented sector.
B) consists of population that works in the country side.
C) consists of an expanding Westernized middle class.
D) represents the high-income urban slums.
E) consists of population that moves from the country to the large cities.

Question 76

Which of the following countries is considered as a BEM (big emerging market)?

A) Australia
B) Egypt
C) Venezuela
D) Mexico
E) Germany

Question 77

The level of market development roughly parallels the stages of _____.

A) economic sustainability
B) economic duress
C) economic repression
D) economic equilibrium
E) economic development

Question 78

With respect to the evolution of the marketing process, which of the following would be considered to be the most fundamental substage (first substage)?

A) Surplus commodity product
B) Commercial transition
C) Mass production
D) Mass distribution
E) Self-sufficient

Question 79

Estimating market potential in less-developed countries involves additional challenges, but most of the difficulty arises from the _____.

A) coexistence of three distinct kinds of markets in each country
B) dependence of the markets on the industrialized sectors
C) lower wage rates of the workforce
D) high fluctuation in the currency rate
E) higher concentration of population residing in the urban areas

Question 80

What is happening in BEMs today is analogous to what happened in:

A) Saudi Arabia in the 1800s.
B) India during the British Empire period.
C) Russia after the fall of the Czar.
D) Europe after World War II.
E) Iraq between 1890 to 1990.