Quiz 2: Economic Environment

A report from Credit Suisse Research Institute (CSRI) considers three potential futures for our global economy.Which of the following is not cited in the report? A)Reversal of globalization to be replaced by nationalism. B)Globalization to continue to expand with the U.S.remaining a financial and military superpower C)The world will become more multipolar and regionally focused D)The emergence of four centers of world power

__________ has helped improve the economies of emerging and developing countries more than those of developed countries. A)The WTO B)NAFTA C)Globalization D)Emigration E)Intellection property rights

The Global economy is becoming more ____________________. A)regional. B)local. C)isolated. D)transnational. E)intertwined.

In general, the larger the country's domestic economy, the less dependent it tends to be on exports and imports relative to its ________________. A)gross domestic product B)gross domestic income C)gross domestic spending D)gross domestic capital E)global domestic knowledge

What rank is the United States in regards to exporters? A)First B)Second C)Third D)Fourth E)Fifth

A nation that is a _________ displays a natural inclination to be competitive in the world market. A)larger importer B)large exporter C)very populous nation D)very large nation E)successful trader

__________ which means investment in manufacturing and service facilities in a foreign country with an intention to engage actively in managing them A)Outsourcing B)Offshoring C)Foreign direct investment D)Having a foreign subsidiary

As of 2017, which company was the largest exporter of automobiles from the United States? A)Honda B)Toyota C)Ford D)GM E)BMW

When firms invest in manufacturing and distribution facilities outside their home countries to expand into new markets around the world, they have added operational capacity to the stock of _________________________________. A)global direct investment B)regional direct investment C)local direct investment D)foreign direct investment E)none of the above

__________________ refers to investment in foreign countries that are withdrawable at short notice (such as investment in foreign stocks and bonds). A)Direct investment B)Economic investment C)International investment D)Demand investment E)Portfolio investment

An example of portfolio investment (or indirect investment) in foreign markets is __________. A)production facilities B)computers C)stocks and bonds D)buildings E)manufacturing facilities

The ________________ volume of international trade in currencies exceeds the annual value of the trade in goods and services. A)daily B)weekly C)monthly D)annual E)None of the above

Trading in foreign currencies has an effect on world trade.For example, a rise in the value of the local currency due to daily flows vis-à-vis other currencies makes exports _________. A)less expensive B)more expensive C)come under government control D)parallel with imports E)be banned

Country competitiveness is not a _____________ thing. A)fixed B)moving C)temporary D)dynamic E)None of the above

The World Economic Forum's Global Competitiveness Report placed one of four Asian Tigers (Singapore) among the world's top _________ economies (along with the Finland, United States, Sweden, Denmark, Iceland, Switzerland, Norway, and Australia). A)five B)ten C)twenty D)twenty-five E)thirty

Which of the following does not contribute to Singapore's consistently high ranking for global competitiveness? A)Education B)Natural resources C)Healthcare D)Infrastructure

Triad regions of the world include: A)North America, Western Europe and Africa B)North America, Western Europe and Japan C)North America, Western Europe and Asia D)North America, Western Europe and South America E)North America, Western Europe and China

BEMs stand for: A)Big Electronic Markets B)Big Efficient Market C)Big Effective Markets D)Big Emerging Markets E)None of the above

In the past 20 years, China's average growth rate in GDP has been over: A)2.0 percent B)4.5 percent C)6.0 percent D)8.3 percent E)9.5 percent

In the past 20 years, India's average growth rate in GDP has been over: A)3.1 percent B)5.7 percent C)7.0 percent D)9.1 percent E)9.7 percent

Which country consistently achieves the highest growth rates in GDP? A)United States B)Germany C)Japan D)Vietnam E)China

Which nation is the world's largest exporter? A)United States B)China C)Netherlands D)Germany E)Japan

Which nation is the world's second largest exporter? A)United States B)China C)Netherlands D)Germany E)Japan

Which nation is the world's third largest exporter? A)United States B)China C)Netherlands D)Germany E)Japan

Which of the following countries is not considered to be a big emerging market? A)Mexico B)Brazil C)Russia D)India E)China

With which country did the U.S.have a trade deficit over $376 billion in 2017? A)United States B)China C)Netherlands D)Germany E)Japan

General Agreements on Tariffs and Trade (GATT) was negotiated after: A)World War I. B)World War II. C)the Korean war. D)the Vietnam war E)None of the above.

The main operating principle of the General Agreements of Tariffs and Trade (GATT) was the concept of normal trade relations (NTR) status, formerly known as: A)Early Favored Nation status. B)Most Favored Nation status. C)Late Favored Nation status. D)World Trade status. E)Best Nation status.

The World Trade Organization was created in the eighth round of the GATT talks-called the ________________________ that lasted from 1986 to 1994. A)Brussels Round B)Paris Round C)Morocco Round D)Paraguay Round E)None of the above

The World Trade Organization (WTO) was created in the _____________ of GATT talks---called the Uruguay Round. A)fifth round B)sixth round C)seventh round D)eighth round E)ninth round

Perhaps the most important accomplishment of the Uruguay round of GATT talks was the establishment of the __________. A)World Trade Organization B)Asian Development Bank C)World Bank D)International Monetary Fund E)International Finance Corporation

The World Trade Organization (WTO) took effect on _________, A)January 1, 1994 B)January 1, 1995 C)January 1, 1996 D)January 1, 2011 E)January 1, 2017

As of April 26, 2015, the World Trade Organization (WTO) has _________ member countries. A)123 B)135 C)142 D)161 E)180

The World Trade Organization's (WTO) ninth round of trade talks which were launched in November 2001 were called: A)the Doha Round. B)the Seattle Round. C)the Geneva Round D)the New York Round. E)the London Round.

Doha's Development Agenda (Doha Round) includes new trade talks-an actions program to resolve developing countries' complaints about the implementation of Uruguay Round agreements, and an accord on ____________________________. A)Trade Related Aspects of Intellectual Property Rights B)Services Related Aspects of Intellectual Property Rights C)Regional Related Aspects of Intellectual Property Rights D)Local Related Aspects of Intellectual Property Rights E)National Related Aspects of Intellectual Property Rights

Which of the following countries got full membership to the WTO during the Doha Round of meetings? A)China and Russia B)Russia and Taiwan C)China and Taiwan D)China, Taiwan, and Russia E)Burma

The agenda for the Doha Round of WTO meeting an accord on Trade Related Aspects of Intellectual Property Rights (TRIPS) ensuring that patent protection does not block developing countries' access to what? A)The Internet B)Affordable medicines C)Lower tariffs for their exports D)Foreign aid from the WTO and the U.S. E)Green energy

One of the differences between WTO and GATT is that WTO's dispute settlement mechanism is: A)inferior. B)faster and more automatic. C)very limited. D)controlled by the World Bank. E)controlled by the negotiation section of the United Nations.

In December 1999, WTO launched what would have become the beginning of a ___________ round of negotiations in Seattle, Washington. A)fifth B)sixth C)seventh D)eighth E)ninth

Why was the December, 1999, WTO meeting in Seattle postponed? A)Weather B)Transportation strike C)High crime D)Protests E)Death of a major world leader

The WTO Work Program on _____________________ is in the process of defining the trade-related aspects of ___________________ that would fall under the parameters of WTO mandates. A)business commerce B)electronic commerce C)equity commerce D)network commerce E)network commerce

With respect to intellectual property rights, an example of an information-related product is: A)computer hardware. B)an automobile. C)computer software. D)jewelry. E)a new drilling bit.

____________________ are highly interested in putting strong international intellectual property laws in place: A)Developing nations B)Developed nations C)Asian countries D)European countries E)African countries

One way around having your intellectual property (such as software) copied because of easy access is to sell: A)demos. B)to new markets. C)to governments. D)subscriptions or membership E)only to a chosen few.

UNCITRAL stands for: A)United Nations Commission on International Trade Law. B)United Nations Commission on International Trade Limits. C)United Nations Commission on International Technical Law. D)United Nations Commission on International Technical Trade. E)None of the above.

UNCITRAL is the core legal body within the United Nations system in the field of what? A)International trade law B)International patent law C)International copyright law D)International export/import law E)International transportation/shipping law

An evolving trend in international economic activity is the formation of: A)multinational advertising agencies. B)multinational insurance agencies. C)multinational trading blocs. D)multinational purchasing agencies. E)multinational courts.

The universal reason for forming trading blocs is to: A)bypass tariff restrictions. B)bypass legal restrictions. C)bypass government controls. D)ensure the economic growth and benefit of the participating countries. E)make competition suffer.

A ___________________ is a formal agreement among two or more countries to reduce or eliminate customs duties and nontariff trade barriers among partner countries. A)trade union B)regional cooperative C)customs union D)common market E)free trade area

Which of the following is an example of an international trading bloc? A)The World Trade Organization. B)GATT C)The World Court in The Hague. D)NAFTA E)The United Nations

NAFTA is the free trade area among the United States, Mexico, and ______________. A)Canada B)Argentina C)Panama D)Columbia E)Brazil

An example of a free trade area would be: A)the European Union. B)the Soviet Union. C)the United Kingdom. D)NAFTA E)the United Nations.

When members of a free trade area add common external tariffs to the provisions of the free trade agreement, the free trade area becomes a: A)cartel. B)common market. C)monetary union. D)political union. E)customs union.

One difference between a customs union and a free trade area is that the customs union: A)adds external tariffs to nonmember countries. B)adds higher taxes to its consumers. C)refuses to import from nonmember nations. D)demands that a common currency be used among members. E)requires that member countries align themselves politically.

A ________________ eliminates all tariffs and barriers to trade among members, adopts a common set of external tariffs on nonmembers, and removes all restrictions on the flow of capital and labor among member nations. A)regional market B)common market C)monetary market D)political market E)customs market

The primary difference between a common market and a customs union is that the common market: A)adopts a common set of external tariffs on nonmembers. B)eliminates all tariffs. C)eliminates all trade barriers. D)removes all restrictions on the flow of capital and labor among member nations. E)the number of countries involved.

The effect of a monetary union is that members: A)can buy goods from one another. B)refuse to buy goods from nonmembers. C)switch to a common currency and a central bank. D)give up all sovereignty. E)no longer recognize national boundaries.

The new European currency, the euro, began its circulation in January ________. A)1998 B)1999 C)2000 D)2001 E)2002

The Maastricht Treaty succeeded the: A)Treaty of Brussels. B)Treaty of Rome. C)Treaty of Geneva. D)Treaty of Paris. E)Treaty of Vienna.

A monetary union represents the ____________ level of integration with a single common currency among politically independent countries. A)first B)second C)third D)fourth E)fifth

The Maastricht Treaty is a(n): A)economic union. B)development union. C)transnational union. D)monetary union. E)national union.

The last step of the possible integration forms is the: A)cartel. B)common market. C)monetary union. D)political union. E)customs union.

The principle goal of a political union is that it: A)can buy goods from one another. B)can refuse to buy goods from nonmembers. C)can switch to a common currency and a central bank. D)gives up all sovereignty among individual members. E)no longer recognizes national boundaries.

The U.S.government defines the multinational company for statistical purposes as a company that owns or controls ______________ or more of the voting securities, or the equivalent, of at least one foreign business enterprise. A)five percent B)ten percent C)fifteen percent D)twenty percent E)twenty-five percent

Researchers have reported that multinationals have not been as great a threat to countries' national sovereignty because multinationals have yet to solve the problem of: A)demand. B)size. C)war. D)religious conflict. E)language differences.

The sovereignty of _______________ will perhaps continue to weaken due to multinationals and the increasing integration of economies. A)cities B)nations C)regions D)trading blocs E)None of the above

Today, countries have become economically independent.

GATT's successor is the World Trade Organization (WTO).

The growth of international flows in goods and services has consistently surpassed the growth rate of the world economy

In most of the years since 2011, world trade has grown at half the normal rate relative to world GDP.

Since the second half of the 1990s, there have been some strong globalization movements.

Globalization has helped improve the economies of emerging and developing countries more than those of developed countries.

Inflation will likely remain a key driving force for the twenty-first-century economy.

The 2008-9 global recession has caused relatively small downturns for countries that opened up most to world trade.

The global economy continues to become more intertwined.

In general, the larger the country's domestic economy, the more dependent it tends to be on exports and imports relative to its GDP.

The world's largest exporting country is China.

The world's largest importing country is the U.S.

Four of the top five exporting countries in 2017 were Asian.

None of the top five importing countries in 2017 were Asian.

Foreign Direct Investment (FDI) means any large investment in a foreign country by a multinational firm.

FDI is shifting from developed countries to developing countries.

The Chinese government provides financial support and credit support to enterprises going abroad.

Asia is the largest FDI recipient region in the world.

Portfolio investments are investments in foreign countries that are spread out over a wide variety of industries.

Country competitiveness refers to how low wage rates are in a country relative to average global wage rates.

There is no evidence that high tax rates in Nordic countries are adversely affecting the ability of these countries to compete effectively in world markets.

In 2018, according to the World Economic Forum's Global Competitiveness Report, five of the top 10 countries are Asian countries.

The Triad Regions of the world (North America, Western Europe, and Japan) were the major economies in most of the 20^th century.

The main operating principle of the General Agreements of Tariffs and Trade (GATT) is the concept of the Highly Favored Nation status (HFN).

The Uruguay Round set up an international body called the World Trade Organization (WTO).

As of April 26, 2015, the WTO had 161 member countries.

The Doha Round paved the way for China and Singapore to get full membership in the WTO.

Due to Chinese objections, Taiwan is not a member of the WTO.

The World Trade Organization (WTO) is a global institutional proponent of free trade.

TRIPs (Trade-Related Aspects of Intellectual Property Rights), an agreement concluded as part of the GATT Uruguay Round, is an attempt to create a universal patent system.

One consequence of fungible content, information products, and electronic networks is an additional assault on the power of national governments to regulate international commerce.

In the U.S., the Federal Trade Commission (FTC) is in charge of cases where entities are trying to mislead the public and commit fraud.

Regulating international e-commerce does not require cross-border cooperation.

A free trade area (FTA) is a formal agreement among two or more countries to reduce or eliminate customs duties and nontariff trade barriers among partner countries.

NAFTA is the free trade area among Canada, the United States, and Chile.

A common market eliminates all tariffs and other barriers to trade among members of the common market.

A common market and a monetary union are basically the same thing.

A monetary union represents the fourth level of integration with a single common currency among politically independent countries.