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Exam 3: Doing Business in Global Markets

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Question 101

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Just about anything that can be sold in the United States can also be sold to buyers in other countries.

A) True
B) False

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Question 102

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Dumping is the practice of selling products in foreign markets at lower prices than what domestic firms are charging for the same product.

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B) False

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Question 103

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Explain and provide at least one example of how legal and regulatory forces impede global trade.

Global trade in services and entertainment has lagged behind the global trade of products. Global trade involves products,services,and entertainment industries.For example,sports entertainment has made significant inroads in Japan,Mexico,Italy,and Germany.

The federal government created ___________ to help small and medium sized businesses get involved in exporting.

In 1999,the European Economic Community adopted a common currency known as the Euro.

When studying abroad last year,Reilly found that his U.S.dollars did not stretch as far as he had hoped.Each time he exchanged U.S.dollars for euros,he gave up more U.S.dollars in exchange for less euros.Obviously,the dollar had strength against the euro. A low value of the dollar means a dollar is traded for less foreign currency.This is the case here.A high value of the dollar means a dollar is trading for more foreign currency.

The purpose of enacting some type of protectionist policy toward foreign goods is to limit competition from abroad,particularly when the country has domestic companies that produce and sell the same products and services. Trade Protectionism is the use of government regulations to limit the import of goods and services.Advocates believe it allows the domestic firms to survive and grow.

Firms with a physical presence in several different nations are considered multinational corporations.

Nike _________________ its products in foreign countries,where labor is cheap and production sites are owned by other companies.This strategy allows Nike to experiment in new markets without incurring large start-up costs involved with building their own production facilities.

The largest importer in the global market today is:

A major advantage of licensing is:

The value of Chinese exports coming to the United States is greater than the value of goods China buys from the United States.This results in a U.S.trade deficit with China. A trade deficit occurs when the value of the country's imports exceed that of its exports.

Workers in the nation of Argenia prefer managers that forcefully tell employees what to do and how to do it.Conversely,employees in the U.S.prefer to participate in decision making in the workplace.This __________ difference between Argenian workers and U.S.workers represents a management challenge for firms trading in the global market.

Comparative advantage theory states that a country should sell to other countries those products that it produces most efficiently and buy from other countries those products it cannot produce as efficiently.

Traders in the 18^th century were encouraged to focus on selling their nation's goods in the global market to create a favorable balance of trade.Nations attempted to sell more goods to other nations than they bought from other nations.This approach to global trading is called:

The purpose of the General Agreement on Tariffs and Trade (GATT) is to:

Trade protectionism is the use of government regulations to encourage the import of goods and services.

Under mercantilism,the basic economic idea was to achieve a favorable balance of trade.

Joanna Bresee,a graduate student from Carnegie Mellon,connected with the culture of Madagascar when she created lamba hoany (a native garment)with artful messages to save the more than 150 rare species of animals that inhabit Madagascar.In contrast to many Americans trying to do business abroad,Joanna successfully adapted her message to the native culture when she imprinted it on the native garment. Adapting products to sociocultural factors can be a key to success in global markets.Joanna obviously understood this in preparing her garments.