Question 1

All but which of the following countries are the top importers of products from the United States?

Accepted Answer

The answer of All but which of the following countries...

Question 2

The advantages of more control over the exporting process, greater profit potential, and direct contact with customers arises with which of the following?

Accepted Answer

Direct exporting allows a company to have more control over the exporting process, set their own prices, and have consistent contact with customers. This means that they have greater profit potential compared to using other methods such as Export Management Companies or Foreign-based distributors or agents. Piggyback exporting may also provide some advantages, but not to the same extent as direct exporting.

Question 3

Tanney's Trade Company buys and sells exported goods while taking title to all merchandise in its possession. The company pays the seller directly for these goods. Tanney's is an example of what type of company?

Accepted Answer

Tanney's Trade Company is an export trade company, as it takes title to the merchandise it exports and pays the seller directly. A piggyback export company typically uses the export licenses of other companies, an export management association is a group of companies that work together to export their products, and a foreign-based distributor is a company located in a foreign country that distributes products on behalf of another company. None of these options fit the description of Tanney's Trade Company.

Question 4

The major distinction between indirect and direct exporting is which of the following?

Accepted Answer

The major distinction between indirect and direct exporting is the use of intermediaries. Direct exporting involves selling products directly to customers in foreign markets, while indirect exporting involves selling products to intermediaries in the domestic market, who then sell them to customers in foreign markets. The other choices (expense, laws and regulations, use of technology) can also vary between the two methods, but the use of intermediaries is the main difference.

Question 5

Intermediaries who set up deals with foreign buyers but do not buy the product from the small business owner are called

Accepted Answer

Agents and brokers are third-party intermediaries who help facilitate deals between small business owners and foreign buyers but do not purchase the goods themselves. Export management companies, export trade companies, and piggyback exporters all involve the actual buying and exportation of goods.

Question 6

The top trading partner for the United States is

Accepted Answer

Canada is the top trading partner for the United States, with a total trade of $718.5 billion in 2019. This is more than double the trade with Mexico, the second highest trading partner, and almost three times higher than trade with China. Japan is not even in the top three trading partners for the US.

Question 7

Foreign affiliates of the U.S. Chamber of Commerce are called:

Accepted Answer

Foreign affiliates of the U.S. Chamber of Commerce are commonly known as AmChams (American Chambers of Commerce).

Question 8

Intermediaries who provide a full range of services and actually take title of the goods and pay the small business owner are called

Accepted Answer

Export Trade Companies are intermediaries who take title of the goods and pay the small business owner while providing a full range of services. Agents and brokers do not take title of the goods and Piggyback exporters do not provide a full range of services. Export Management Companies provide similar services but do not take title of the goods.

Question 9

Intermediaries who provide a full range of services such as conducting marketing research, arranging financing, and acting as the export department for small companies but do not take title to the goods or services are called which of the following?

Accepted Answer

Export Management Companies (EMCs) provide a wide range of services for small to medium-sized firms that want to export but do not have the resources or capability to do so independently. EMCs assist with marketing research, financing, and acting as the export department for the company. However, they do not take legal ownership of the goods or services being exported, distinguishing them from Export Trading Companies.

Question 10

If a small business is importing as opposed to exporting, the major focus of activities shifts from supplying the product to

Accepted Answer

When a small business is importing, the major focus of activities shifts from supplying the product to finding an appropriate source of the product. This involves selecting suppliers, establishing relationships, negotiating prices and contract terms, and ensuring timely delivery of goods. Once a suitable source has been identified, the focus may then shift to delivering the product to customers and marketing it effectively to generate sales. However, the primary challenge for small businesses that import is to identify reliable suppliers who can provide high-quality products at competitive prices.

Question 11

Foregoing short-term profits in the interest of long-term gain, allocating funds for travel, modifications of product and/or packaging, and additional financing are all disadvantages of

Accepted Answer

Exporting may require foregoing short-term profits in the interest of long-term gain, as it often involves investment in travel, modifications of product and/or packaging, and additional financing. Joint ventures, licensing, and importing may also involve some of these disadvantages, but they are not as consistently associated with them as exporting.

Question 12

All but which of the following are disadvantages of exporting?

Accepted Answer

Development of new promotional materials, necessity for additional financing, and additional administrative expenses are all potential disadvantages of exporting. However, increased market accessibility is actually a benefit of exporting.

Question 13

All but which of the following are advantages of exporting?

Accepted Answer

Modification of product packaging is not an advantage of exporting. The other three options, increased total sales and profits, reduced dependence on existing markets, and enhanced domestic competitiveness, are advantages of exporting.

Question 14

A small business owner who must choose the target country, arrange the most efficient channel of distribution, and market the product is using which of the following?

Accepted Answer

Direct exporting allows the small business owner to have complete control over the target country, channel of distribution, and marketing strategy. This method involves the small business owner directly exporting their product to the target country through various means such as distributors or agents. It allows for the small business owner to have a better understanding and control of the international market which can lead to greater success.

Question 15

An intermediary who is already exporting may let a small business owner take advantage of the international connections they have already established. This is known as

Accepted Answer

Piggyback exporting is when a small business owner uses the international connections of an intermediary who is already exporting. The intermediary handles the logistics of the export while the small business owner benefits from the established connections.

Question 16

An intermediary who is already based in the foreign country and who can provide the advantage of knowledge of the local culture is known as

Accepted Answer

A foreign-based distributor or agent is already based in the foreign country and has knowledge of the local culture, providing an advantage in conducting business in that market. An agent or broker (option A) can also be located in a foreign country but may not necessarily have the same level of knowledge of the local culture. Export management companies (option B) generally do not have a physical presence in foreign countries. Piggyback exporters (option D) are not relevant to the question as they refer to a different concept of exporting.

Question 17

The major disadvantage of using an intermediary is which of the following?

Accepted Answer

The major disadvantage of using an intermediary is the fees charged by the intermediary.

Question 18

The simplest and most cost-effective method for a small business to use in exporting is to

Accepted Answer

The answer of The simplest and most cost-effective method for...

Question 19

All but which of the following are choices when using direct exporting?

Accepted Answer

The answer of All but which of the following are...

Question 20

Which of the following is an independent federal agency with a program that covers 100 percent of working capital for a commercial loan for financing international business activities of small businesses?

Accepted Answer

The Export-Import Bank is the independent federal agency that offers a program covering 100 percent of working capital for a commercial loan intended to finance international business activities of small businesses. The SBA offers guarantees for loans made by financing partners, but it does not cover 100 percent of working capital. The National Association of Credit Management is a nonprofit organization that offers education and networking opportunities for credit professionals, and the World Bank is an international financial institution that provides loans and grants to developing countries.

Quiz 15: International Small Business