Question 1

All of the following serve as starting points for country analysis except _______.&#10;A) Leading economic indicators for the foreign country&#10;B) Trends in economic indicators for the foreign country&#10;C) Analysis of specific sectors of the foreign country&#10;D) Analysis of maturity level of home market

Accepted Answer

The analysis of the maturity level of the home market pertains to the domestic market of a business, not a foreign country, and therefore is not a starting point for country analysis. Leading economic indicators, trends in economic indicators, and analysis of specific sectors are all key starting points for understanding the economic landscape of a foreign country.

Question 2

The sum of the total goods and services produced in a country, including the net foreign transactions is known as ________.&#10;A) Gross domestic product&#10;B) Terms of trade&#10;C) Gross national income&#10;D) Current account

Accepted Answer

Gross national income (GNI) includes the total goods and services produced in a country plus net foreign transactions (income from abroad).

Question 3

Which of the following economic variables would not be helpful in assessing the target market for a mobile phone company?&#10;A) GNI per capita&#10;B) Population density&#10;C) Net disposable income&#10;D) Literacy rates

Accepted Answer

Literacy rates are not directly related to the target market for a mobile phone company as owning and using a mobile phone does not necessarily require a certain level of literacy. GNI per capita, population density, and net disposable income are all variables that can help in assessing the target market for a mobile phone company.

Question 4

Developing countries that specialize in agriculture are typically operating in the ______ sector of the economy.&#10;A) Primary&#10;B) Secondary&#10;C) Tertiary&#10;D) Shadow

Accepted Answer

The primary sector of the economy includes activities related to extracting natural resources, such as agriculture, forestry, fishing, mining, and oil and gas extraction. Developing countries that specialize in agriculture are therefore operating in the primary sector. The secondary sector includes manufacturing and construction, while the tertiary sector includes services such as healthcare, education, and finance. There is no such thing as a shadow sector of the economy.

Question 5

A country facing balance of payment difficulties is more prone to _________.&#10;A) Impose restrictions on imports&#10;B) Increase restrictions on exports&#10;C) Increase restrictions on repatriation of profits&#10;D) Both A and C are correct

Accepted Answer

A country facing balance of payment difficulties often imposes restrictions on imports to reduce its outflow of foreign exchange. This is done to reduce the current account deficit. Additionally, the country may also increase restrictions on repatriation of profits to retain foreign exchange reserves. This helps in balancing the current account and promoting a healthy balance of payments.

Question 6

Taxes based on the production of goods by a company are known as _______.&#10;A) Value added taxes&#10;B) Excise taxes&#10;C) Ad valorem taxes&#10;D) Demurrage fees

Accepted Answer

Excise taxes are taxes imposed on specific goods produced domestically, such as alcohol, tobacco, and gasoline. Value added taxes (A) are assessed on the value added to a product at each stage of production and distribution, while ad valorem taxes (C) are taxes assessed on the value of a product, such as a sales tax. Demurrage fees (D) are charges for delaying a shipment beyond an agreed-upon time.

Question 7

The method for estimating demand based on a string of estimates of market size and attributes is known as the _______.&#10;A) Chain ratio&#10;B) Anchor ratio&#10;C) Market buildup ratio&#10;D) Hyperbolic ratio

Accepted Answer

The Chain Ratio method involves estimating demand by applying a series of ratios or percentages to a base number, reflecting various market attributes and size adjustments.

Question 8

Using data from one country to infer market demand for another country is known as ________.&#10;A) Historical trend analysis&#10;B) Analysis by analogy&#10;C) Primary research&#10;D) Regression analysis

Accepted Answer

Using data from one country to infer market demand for another country is known as analysis by analogy, where the assumption is that the two countries are similar enough in terms of economic and social factors that trends seen in one can be applied to the other. Historical trend analysis, primary research, and regression analysis do not necessarily involve using data from other countries.

Question 9

Pitfalls of primary research include all except ______.&#10;A) Cultural differences&#10;B) Differences in privacy&#10;C) Technology differences&#10;D) Time zone issues

Accepted Answer

Primary research pitfalls include cultural differences, differences in privacy, and technology differences, but time zone issues are more related to logistical challenges rather than inherent pitfalls of primary research methodology.

Question 10

Income is considered to be inelastic when _______.&#10;A) The value of the ratio of demand and income is greater than 1.00&#10;B) As personal income drops, demand for a given product drops&#10;C) A change in income yields less than an equal change in product demand&#10;D) Jimmy goes out to dinner more now that he has a full-time job

Accepted Answer

Inelastic income means a change in income yields less than an equal change in product demand. This means that even though people's income changes, their demand for a certain product remains relatively steady. Therefore, option C is the right choice.

Question 11

The tertiary sector refers to services.

Accepted Answer

The answer of The tertiary sector refers to services....

Question 12

Hyperinflation recently occurred in the United States.

Accepted Answer

The answer of Hyperinflation recently occurred in the United States....

Question 13

Fiscal policy involves government expenditures relative to income.

Accepted Answer

The answer of Fiscal policy involves government expenditures relative to...

Question 14

Concerned citizens recently held violent protests outside of the OECD offices.

Accepted Answer

The answer of Concerned citizens recently held violent protests outside...

Question 15

The Edgeworth Box got its name from a famous painting from the 1920s.

Accepted Answer

The answer of The Edgeworth Box got its name from...

Deck 7: Analyzing National Economies