International Business Opportunities and Challenges Study Set 1

Business

Quiz 9 :

Exporting, Importing, and Global Sourcing

Quiz 9 :

Exporting, Importing, and Global Sourcing

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The carbon-footprint measure focuses on distance rather than looking at all the fossil fuels used in the manufacture of an item.
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False

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Entrepreneurs benefit from outsourcing because they can acquire services as needed, without having to build those capabilities internally.
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True

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Companies use distributors because distributors know the local market and are a cost-effective way to enter that market.
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True

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Governments use bills of lading to determine the value of the goods for customs-valuation purposes.
True False
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Under a licensing agreement, a multinational firm provides a bundle of services and products to a foreign company.
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The customs invoice acts as proof that the shipment was made and that the goods have been received.
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Countertrade also can mitigate the risk of price movements or currency-exchange-rate fluctuations.
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Most companies consider licensing to be a low-risk market-entry option because there is typically no upfront investment.
True False
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The draft that allows a period of 120 days to pay is very attractive for the importer because it allows time for the importer to sell the goods before having to pay for them.
True False
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Letters of credit are trusted forms of payment in international trade because the bank promises to make the payment on behalf of the importer.
True False
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Under a licensing agreement, the licenser is normally paid a royalty on each unit produced and sold.
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The sight draft is payable at a later time, typically 30, 60, 90, or 120 days in the future as specified by the draft.
True False
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In global sourcing, ocean transport has a higher carbon footprint compared to transporting goods by air and truck.
True False
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Customs administration offices in both the home country and the country to which the item is being exported are involved in the transaction of goods.
True False
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Distributors or export intermediaries are barred from taking title to the goods and then reselling them.
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Countertrade is a resourceful way for exporters to sell their products and services to foreign companies or countries that would be unable to pay for them using Hard currency alone.
True False
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Licensing makes for a flatter world, because it creates a legal vehicle for taking a product or service delivered in one country and providing a nearly identical version of that product or service in another country.
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One of the drawbacks of countertrade is the quality of goods received which are often useless or of poor quality.
True False
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Import duties are lower for countries that are designated as a "most favored nation."
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An export management company is a government organization that ensures sound development of a country's export trade through quality control and inspection.
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