Question 1

Fiscal Corporation, a U.S. firm, files a suit against Ghana in a U.S. court. Under the Foreign Sovereign Immunities Act, Ghana is immune from the jurisdiction of the court if Ghana has

Accepted Answer

Under the Foreign Sovereign Immunities Act, foreign states are generally immune from the jurisdiction of U.S. courts. The exceptions to this immunity include, but are not limited to, cases where a foreign state has engaged in commercial activity with a direct effect in the United States or committed a tort in the United States, thus options A, B, and C are exceptions to the rule of immunity, not instances where immunity applies.

Question 2

Sugar Company, a U.S. firm, owns property in Trinidad and Tobago. When the foreign government seizes the property, the company asks a U.S. court to order the property's return. The court rules that the Trinidad and Tobago is exempt from the court's jurisdiction. This is an application of

Accepted Answer

The court ruling that Trinidad and Tobago is exempt from the court's jurisdiction is an application of the doctrine of sovereign immunity, which protects foreign governments from being subject to the jurisdiction of another country's court system.

Question 3

Consolidated Corporation, a U.S. firm, wishes to participate, but limit its involvement, in Middle Eastern markets. Consolidated empowers Doha Ltd., an Egyptian firm, to enter into contracts in certain countries on behalf of Consolidated. This is

Accepted Answer

Empowering Doha Ltd. to act on behalf of Consolidated Corporation in certain countries is indicative of an agency relationship, where Doha Ltd. would act as an agent for Consolidated in those particular countries.

Question 4

Burger Bistros, a U.S. firm, makes a deal with a Canadian firm, Donny's Diners, that allows Donny's to use Burger's trade name in Canada in return for a fee. This is

Accepted Answer

This is a classic example of a licensing agreement, where Burger Bistros is granting Donny's Diners the permission to use its trademark (trade name) in a specific geographic location (Canada) in exchange for a royalty or fee. A distribution agreement involves the sale and distribution of actual products rather than just a trademark. A subsidiary would involve Burger Bistros establishing a separate legal entity in Canada to conduct business, while direct exporting would involve Burger Bistros selling its products directly to Canadian customers without the involvement of Donny's Diners.

Question 5

The United States taxes most goods imported from China at a flat rate. This is

Accepted Answer

The United States taxes most goods imported from China at a flat rate. This is known as a tariff, which is a tax on imported goods. A tariff can be used as a tool to protect domestic industries by making foreign goods more expensive, encouraging consumers to buy domestic products instead.

Question 6

In international business, franchising involves

Accepted Answer

Franchising involves the licensing of a company's products, services, or brand name to another company or individual. The franchisor provides the franchisee with the right to use their business model, intellectual property, and operating systems in exchange for an initial fee and ongoing royalties.

Question 7

The government of Japan sets a limit on the amount of beef that can be imported from the United States. This is

Accepted Answer

The limit set by the Japanese government on the amount of beef imported from the United States is a quota. A quota is a restriction on the quantity of a particular good that can be imported into a country during a specified period of time. A dumping duty is a tax or tariff imposed on goods that are imported into a country at a price lower than the fair market value. An antidumping duty is a special tariff imposed on goods that are suspected of being sold in a foreign market below their fair market value. A tariff is a tax or duty imposed on imports or exports, often as a way to protect domestic industries.

Question 8

Airbud Corporation, a U.S. firm, signs a contract with Bueno Computadores Ltd., an Argentinean firm, for a shipment and payment for Airbud's goods. This is

Accepted Answer

Airbud Corporation signing a contract with Bueno Computadores Ltd. for shipment and payment of goods indicates that Airbud is directly exporting to Argentina.

Question 9

Global Project, a U.S. firm, owns property in Hong Kong. The government of China seizes the property. The firm claims that this is confiscation. The government claims that it is expropriation. The difference concerns

Accepted Answer

The difference between confiscation and expropriation is the purpose of the seizure and the payment of compensation. Confiscation is when the government seizes property without compensation or for a nonpublic purpose, while expropriation is when the government seizes property for a public purpose but with compensation. In this case, the firm claims that the seizure is confiscation because they did not receive compensation for their property, while the government claims it is expropriation because they intended to use the property for a public purpose. The location of the seizure and the nature of the government, the business of the firm, and the citizenship of its owners are not relevant to the difference between confiscation and expropriation.

Question 10

Agri Products Inc., a U.S. firm, signs a contract with Bao Ltd., a Chinese firm, to distribute Agri's products in China. The most likely reason for this deal is

Accepted Answer

The deal is most likely due to the fact that China represents a substantial market for Agri. This would be the primary motivation for any firm to enter into a distribution agreement with a foreign firm. The other options do not seem to be applicable to this scenario.

Question 11

Lunchies Corporation, a U.S. firm, signs a contract with Manger au Brasserie, S.A., a French firm, to give Manger the right to use the Lunchies trademark in restaurants in France. This is

Accepted Answer

The scenario described is an example of licensing, where a company (Lunchies) grants another company (Manger) the right to use their trademark in exchange for payment or other benefits.

Question 12

Resort Hotel Corporation, a U.S. firm, establishes a wholly owned subsidiary in Singapore. As a parent corporation, with respect to the subsidiary, Resort retains complete ownership of

Accepted Answer

A wholly owned subsidiary means that the parent corporation (Resort Hotel Corporation) retains 100% ownership of the subsidiary, including all facilities in Singapore.

Question 13

Habitat Corporation, a U.S. firm, owns property in India. The government of India seizes the property for a proper public purpose and pays the firm just compensation. This is

Accepted Answer

Expropriation refers to the seizure of foreign property by a government, usually with compensation. Confiscation is similar to expropriation, but without compensation. The act of state doctrine refers to the principle that courts of one country will not sit in judgment of the acts of another government. The doctrine of sovereign immunity provides immunity for foreign governments from being sued in other countries' courts.

Question 14

Opti-Med Inc., a U.S. firm, signs a contract with Pharma Ltd., a Canadian firm, to give Pharma the right to sell Opti-Med's products in Canada. This is

Accepted Answer

This is a distribution agreement, as Opti-Med Inc. is giving Pharma Ltd. the right to sell its products in Canada. This arrangement allows Opti-Med to expand its market reach without having to establish a separate Canadian operation.

Question 15

Wei Ltd., a Chinese firm, imports its goods into the United States and offers those goods for sale at "less than fair value." This is

Accepted Answer

Dumping refers to a situation where a foreign firm sells its goods in another country at a price that is lower than the price charged in its home market or lower than the cost of production. This practice can negatively impact domestic producers and distort competition in the import market. In this scenario, Wei Ltd. is selling its goods at "less than fair value," indicating that it may be engaging in dumping.

Question 16

Venezuela seizes the assets of World Oil Inc., a U.S. firm. World Oil's recovery from Venezuela in a U.S. court may be prevented by

Accepted Answer

The act of state doctrine holds that courts should not examine the validity of actions taken by a foreign government within its own territory. Since Venezuela seized the assets of World Oil Inc. within its own territory, the act of state doctrine may prevent World Oil's recovery from Venezuela in a U.S. court.

Question 17

Mont Blanc S.A., a French firm, imports its goods into the United States and offers those goods for sale at "less than fair value." Fair value is the price of Mont Blanc's goods in

Accepted Answer

The answer of Mont Blanc S.A., a French firm, imports...

Question 18

Sufficient business develops in France for Graphic Comics Inc., a U.S. firm, to appoint Comics Graphique Ltd., a French firm, to act as the U.S. firm's marketing representative in France. This is

Accepted Answer

This is an example of indirect exporting, in which an intermediary (Comics Graphique Ltd.) is utilized to export the product to the foreign market (France).

Question 19

Market Maven Inc., a U.S. firm, can license a foreign manufacturing company to use its

Accepted Answer

Market Maven Inc. can potentially license any or all of its forms of intellectual property to a foreign manufacturing company. Patented intellectual property would refer to unique inventions or processes, trade secrets may refer to confidential information or formulas, and trademarked brands would be the official logos, names, or slogans associated with the company's products. Depending on the terms of the license agreement, any combination of these forms of intellectual property could be licensed by Market Maven Inc. to the foreign manufacturing company.

Question 20

Trade barriers are

Accepted Answer

Trade barriers refer to government-imposed restrictions on imports or exports, in order to protect domestic industries or for other economic or political reasons. Therefore, A is the best choice as it directly refers to restrictions on imports. The other options, B, C, and D, do not accurately describe trade barriers.

Quiz 11: International and Space Law