Question 1

A business relationship where the buyer pays for the goods prior to receipt is known as ________.&#10;A) The Dracula Effect&#10;B) An open account&#10;C) A letter of credit&#10;D) A bill of exchange

Accepted Answer

B

Question 2

The ________ provides export credit insurance to qualified exporters.&#10;A) OECD&#10;B) Bank for International Settlements&#10;C) Export Import Bank of the United States&#10;D) Letter of credit

Accepted Answer

The Export Import Bank of the United States provides export credit insurance to qualified exporters. The other options are not directly related to providing export credit insurance.

Question 3

The bill of lading contains all of the following except _________.&#10;A) Name of shipping company&#10;B) Nationality of the ship captain&#10;C) Description of the goods shipped&#10;D) Port of destinations

Accepted Answer

The bill of lading typically contains the name of the shipping company, description of the goods shipped, and the port of destination. However, it does not typically include the nationality of the ship captain.

Question 4

________ fees are associated with the storage of the exporter's goods at the foreign loading dock following refusal of shipment by the importer.&#10;A) Dumping&#10;B) Defeasance&#10;C) Demurrage&#10;D) Deforestation

Accepted Answer

Demurrage fees are charged when goods are held at a foreign loading dock due to the refusal of the importer to accept them. These fees are charged to the exporter for the storage of the goods. Dumping refers to the practice of selling goods in a foreign market at a lower price than in the home market, which can have different fees associated with it. Defeasance is a legal term that refers to the act of releasing a claim or interest in a property, and is not related to export fees. Deforestation is the clearing of forests for non-forest use and is not related to export fees.

Question 5

In a letter of credit, the advising bank is also known as the ________.&#10;A) Exporter's bank&#10;B) Importer's bank&#10;C) Consignor's bank&#10;D) Shipper's bank

Accepted Answer

The advising bank in a letter of credit is also known as the Exporter's bank because it is the bank that advises the exporter (seller) of the terms and conditions of the letter of credit without necessarily having the obligation to pay.

Question 6

The transparency index to rate sovereign wealth funds was theorized by ______.&#10;A) Herfindahl and Hirschman&#10;B) Leontief and Triffen&#10;C) Linaburg and Maduell&#10;D) Lindberg and Murdoch

Accepted Answer

The transparency index to rate sovereign wealth funds was theorized by Linaburg and Maduell.

Question 7

The largest producer of oil in the world is ______, while the largest consumer is ______.&#10;A) Iraq, United States&#10;B) Saudi Arabia, China&#10;C) United States, United States&#10;D) Saudi Arabia, United States

Accepted Answer

According to the International Energy Agency, as of 2021, Saudi Arabia is the largest producer of oil in the world, while the United States is the largest consumer.

Question 8

The Dracula effect is best defined as _______.&#10;A) Not doing business in markets without proper research&#10;B) Exposing a problem a problem to light to make it go away&#10;C) Focusing hiring on Eastern European economies&#10;D) Utilizing shipping routes through the Cape of Good Hope

Accepted Answer

The Dracula effect is based on the idea that by exposing a problem to public scrutiny, it can be effectively addressed and resolved. This term stems from the popular belief that sunlight is fatal to vampires like Dracula, who prefer the darkness. Therefore, exposing the vampire to the light renders him powerless. Similarly, exposing a problem to light, or public scrutiny, can render it powerless and lead to its resolution.

Question 9

Most sovereign wealth funds were created by nations with ________.&#10;A) Current account deficits&#10;B) Capital account surpluses&#10;C) Current account surpluses&#10;D) Agriculture intensive economies

Accepted Answer

Sovereign wealth funds are typically created by countries with current account surpluses, as they have excess funds that they can invest in order to earn more returns. This helps them to diversify their assets, manage risks, and provide a source of income for future generations. Countries with capital account surpluses may also create sovereign wealth funds, but current account surpluses are typically the main source of funding. Current account deficits, on the other hand, indicate that a country is importing more than it is exporting, which means that it may not have the excess funds necessary to create a sovereign wealth fund. The type of economy a country has (such as agriculture intensive) is not directly related to the creation of a sovereign wealth fund.

Question 10

Under a banker's acceptance, the bank is accepting the risk of non-payment of a time draft for a fee.

Accepted Answer

A banker's acceptance involves the bank accepting the obligation to pay a time draft on behalf of the borrower, thereby assuming the risk of non-payment. The bank charges a fee for this service, which is typically based on the creditworthiness of the borrower and the length of the term of the time draft.

Question 11

A key component of the bill of lading is the calculation of demurrage fees.

Accepted Answer

The answer of A key component of the bill of...

Question 12

Only a portion of the small island of Cyprus is a member of the European Union.

Accepted Answer

The answer of Only a portion of the small island...

Question 13

Sovereign wealth funds in Norway, Saudi Arabia, and China have been funded by the export of oil to foreign markets.

Accepted Answer

The answer of Sovereign wealth funds in Norway, Saudi Arabia,...

Question 14

In the future, small firms will begin to dominate global markets at the expense of larger firms.

Accepted Answer

The answer of In the future, small firms will begin...

Deck 12: Future Issues in International Business