Question 1

The investing of resources in business activities outside a firm's home country is referred to as:
A) international trade
B) domestic direct investment
C) transnational barter
D) foreign direct investment
E) outsourcing

Accepted Answer

Foreign direct investment refers to the investment of resources in business activities outside a firm's home country. It involves establishing wholly-owned subsidiaries, joint ventures, or partnerships with foreign companies to carry out business activities in the host country. This can involve setting up production facilities, acquiring or merging with local firms, or investing in greenfield projects. Foreign direct investment is a significant driver of global economic growth and plays a crucial role in integrating diverse economies.

Question 2

Which of the following was not an outcome of the Uruguay Round of the GATT?
A) reduced trade barriers
B) extended GATT to cover services as well as manufactured goods
C) established the World Trade Organization
D) provided extended protection for patents, trademarks, and copyrights
E) reduced agricultural subsidies

Accepted Answer

The Uruguay Round of the GATT did result in reduced trade barriers, extended GATT to cover services as well as manufactured goods, established the World Trade Organization, and provided extended protection for patents, trademarks, and copyrights. However, it did not result in reduced agricultural subsidies.

Question 3

The factors of production include:
A) information technology
B) process design
C) markets
D) labour
E) research and development

Accepted Answer

The factors of production are commonly known as the resources required for producing goods and services. These factors are land, labor, capital, and entrepreneurship. Out of the given options, only labor is a factor of production. Information technology, process design, markets, and research and development are important in business operations but do not fall under the category of factors of production.

Question 4

HYPERLINK "" Firm X exports a number of products to users in other countries.This practice is referred to as __________.
A) world exchange
B) international trade
C) cross-national barter
D) situational commerce
E) multinational diversification

Accepted Answer

International trade refers to the exchange of goods and services between different countries. Firm X exporting its products to users in other countries falls under the category of international trade.

Question 5

According to the opening case,the most important reason to assemble iPhones in China was due to:
A) lower labour costs in China
B) foreign exchange rates
C) consumer preferences for foreign items
D) the ability to scale production up and down
E) tariffs and trade barriers

Accepted Answer

The most important reason to assemble iPhones in China was the ability to scale production up and down efficiently, allowing Apple to meet the high demand for its products quickly and flexibly.

Question 6

Although Inco is a Canadian company,it has invested substantial business resources in activities outside Canada.This practice is referred to as:
A) transnational commerce
B) foreign direct investment
C) international trade
D) organizational diversification
E) outsourcing

Accepted Answer

Foreign direct investment refers to a company investing its resources in activities outside the country where it is based. This is the most appropriate choice as the question specifically mentions Inco investing outside Canada. Transnational commerce refers to the exchange of goods and services between multiple countries, which may or may not involve direct investment. International trade is a broader term that encompasses both imports and exports, but does not necessarily involve investment. Organizational diversification refers to a company expanding its business activities into different areas or sectors, which may or may not involve international activities. Outsourcing refers to a company contracting out work to external providers, which is a different concept than investing or conducting business activities outside the country.

Question 7

The _______ is seen as the lender of last resort to nation-states whose economies are in turmoil and currencies are losing value against those of other nations.
A) International Monetary Fund
B) International bank
C) United Nations
D) Canada's Export Development Corporation
E) Bank of Canada

Accepted Answer

The International Monetary Fund (IMF) is specifically designed to serve as the lender of last resort for nation-states facing economic crises. It provides financial assistance and policy advice to member countries, helping them stabilize their economies and restore financial stability. The other options listed are not primarily focused on providing such assistance.

Question 8

Sourcing goods and services from locations around the globe is known as __________.
A) melding of markets
B) integration of markets
C) deregulation
D) globalization of production
E) globalization of markets

Accepted Answer

Sourcing goods and services from locations around the globe is known as globalization of production.

Question 9

Although this organization is perhaps best known for its peacekeeping role,one of its central mandates is the promotion of higher standards of living,full employment,and conditions of economic and social progress and development.What is it called?
A) World Bank
B) GATT
C) United Nations
D) Canada's Export Development Corporation
E) Bank of Canada

Accepted Answer

The United Nations has a central mandate to promote higher standards of living, full employment, and conditions of economic and social progress and development, among other goals. While the World Bank and the Export Development Corporation are focused on specific financial and economic issues, and GATT (which has since been replaced by the World Trade Organization) was focused on international trade, the United Nations has a broader mandate encompassing economic, social, and political issues. The Bank of Canada is Canada's central bank and is responsible for monetary policy, not economic development or social progress.

Question 10

The globalization of __________ refers to the sourcing of goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production (such as labour,energy,land,and capital).
A) information technology
B) process design
C) markets
D) production
E) R&D

Accepted Answer

The description provided refers to the globalization of production, also known as global sourcing or outsourcing. This involves companies producing goods or services in different countries based on factors such as cost, quality, and availability of resources or labor. Therefore, option D - production, is the most appropriate answer.

Question 11

The trend toward a more integrated and interdependent global economic system that has been in place for many years is commonly referred to as:
A) market standardization
B) cross-border integration
C) globalization
D) consumerism
E) nationalization

Accepted Answer

The trend toward a more integrated and interdependent global economic system is commonly referred to as globalization. This term encompasses the increasing interconnectedness of countries and businesses around the world through trade, investment, and the circulation of technology and ideas. It has been a major force shaping the global economy and has brought both benefits and challenges.

Question 12

Who is responsible for policing the world trading system?
A) International Monetary Fund
B) The World Bank
C) The World Trade Organization
D) Canada's Export Development Corporation
E) Bank of Canada

Accepted Answer

The World Trade Organization (WTO) is responsible for policing the world trading system. It is an intergovernmental organization that regulates international trade and sets the rules for global commerce. Its primary function is to ensure that trade flows as smoothly, predictably, and freely as possible, and that countries abide by their trade agreements.

Other answer choices:
A) Incorrect. The International Monetary Fund (IMF) is responsible for promoting international monetary cooperation, facilitating international trade, and promoting economic growth and stability. It is not responsible for policing the world trading system.
B) Incorrect. The World Bank is responsible for providing financial and technical assistance to developing countries. It is not responsible for policing the world trading system.
D) Incorrect. Canada's Export Development Corporation is a Canadian government-owned export credit agency that provides financing, insurance, and bonding services to Canadian exporters and investors. It is not responsible for policing the world trading system.
E) Incorrect. The Bank of Canada is Canada's central bank responsible for promoting the economic and financial well-being of Canada. It is not responsible for policing the world trading system.

Question 13

The _______ was created in 1944 by 44 nations that met in Breton Woods,New Hampshire.
A) International bank
B) World Monetary Fund
C) World Trade Organization
D) International Monetary Fund
E) United Nations

Accepted Answer

The International Monetary Fund (IMF) was created in 1944 by 44 nations that met in Breton Woods, New Hampshire. Its purpose was to promote international monetary cooperation, exchange stability, and facilitate the balanced growth of international trade. The IMF works to help member countries manage their economic policies, providing loans to help resolve balance of payments problems and offering policy advice and training.

Question 14

Which of the following refers to the exporting of goods or services to consumers in another country?
A) situational commerce
B) world exchange
C) international trade
D) cross-national barter
E) foreign investment

Accepted Answer

International trade involves the exchange of goods and services across borders, from one country to another. It refers to the exporting of goods or services to consumers in another country. The other options are not the correct term for this type of exchange.

Question 15

After World War II,the West committed to removing trade barriers between nations because of what experience?
A) the loss of production from the war
B) retaliatory trade policies leading to the Depression
C) the General Agreement on Tariffs and Trade
D) massive waves of immigrants seeking jobs
E) the shift away from production to consumption

Accepted Answer

The experience that led to the commitment to removing trade barriers was the retaliatory trade policies that countries implemented after World War I, which worsened the Great Depression of the 1930s. Many countries increased tariffs and other trade barriers in an attempt to protect their own industries, but this led to a decrease in international trade and a worsening of economic conditions. This experience led to a commitment to free trade and the removal of trade barriers after World War II. The General Agreement on Tariffs and Trade was a multilateral agreement that helped facilitate this process.

Question 16

What was created at the same time as the International Monetary Fund?
A) World Bank
B) GATT
C) United Nations
D) Canada's Export Development Corporation
E) Bank of Canada

Accepted Answer

The International Monetary Fund (IMF) and the World Bank were both created at the same time during the Bretton Woods Conference in 1944. The IMF was established to promote international monetary cooperation and exchange rate stability, while the World Bank was created to provide financial assistance and support economic development in post-World War II reconstruction efforts.

Question 17

The __________ is a treaty designed to remove barriers to the free flow of goods,services,and capital between nations.
A) Global Agreement on Tariffs and Commerce
B) United Nations Treaty on Trade
C) General Agreement on Tariffs and Trade
D) Multi-National Agreement on Tariffs and Commerce
E) The ILO

Accepted Answer

The General Agreement on Tariffs and Trade (GATT) is a treaty created to reduce trade barriers between nations. It was signed by 23 nations in 1947 and has since been expanded to include over 120 member countries. GATT has been succeeded by the World Trade Organization (WTO) in 1995, which continues its mission to promote free trade. The other answer choices are not correct or do not exist.

Question 18

_______ are the two macro factors that seem to underlie the trend toward greater globalization.
A) The increase in global economic stability, and the slowdown in technological change
B) The increase in barriers to the free flow of goods, services, and capital that has occurred since the end of World War II, and global economic stability
C) The decline in barriers to the free flow of goods, services, and capital that has occurred in the past 10 years, and the slowdown in technological change
D) The decline in barriers to the free flow of goods, services, and capital that has occurred since the end of World War II, and technological change
E) Technological Change and the convergence of global product preferences

Accepted Answer

The decline in barriers to the free flow of goods, services, and capital that has occurred since the end of World War II, and technological change are the two macro factors that seem to underlie the trend toward greater globalization. This is because the reduction in trade barriers has allowed for more international trade and investment, while technological advancements have made communication and transportation more efficient and affordable, further facilitating the globalization of markets.

Question 19

Under the umbrella of GATT there have been eight rounds of negotiations among member states.The _______ was the most recent round of negotiations.
A) Uruguay Round
B) Malaysian Symposium
C) German Round
D) New Zealand Symposium
E) Cancun Round

Accepted Answer

The Uruguay Round was held from 1986 to 1994 and was the most recent round of negotiations under the General Agreement on Tariffs and Trade (GATT). The other options mentioned, such as the Malaysian Symposium, German Round, New Zealand Symposium, and Cancun Round, are not rounds of negotiations under GATT.

Question 20

XYZ,Inc.is an auto parts distributing warehouse that exports many of its products to consumers in other countries.XYZ Inc.can be described as engaging in:
A) international trade.
B) cross-border investments.
C) product development.
D) trading barriers.
E) international procurement.

Accepted Answer

XYZ, Inc. is involved in exporting its products to consumers in other countries, which falls under the category of international trade.

Quiz 1: Globalization

The investing of resources in business activities outside a firm's home country is referred to as:

Which of the following was not an outcome of the Uruguay Round of the GATT?

The factors of production include:

HYPERLINK "" Firm X exports a number of products to users in other countries.This practice is referred to as __________.

According to the opening case,the most important reason to assemble iPhones in China was due to:

Although Inco is a Canadian company,it has invested substantial business resources in activities outside Canada.This practice is referred to as:

The _______ is seen as the lender of last resort to nation-states whose economies are in turmoil and currencies are losing value against those of other nations.

Sourcing goods and services from locations around the globe is known as __________.

Although this organization is perhaps best known for its peacekeeping role,one of its central mandates is the promotion of higher standards of living,full employment,and conditions of economic and social progress and development.What is it called?

The globalization of __________ refers to the sourcing of goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production (such as labour,energy,land,and capital) .

The trend toward a more integrated and interdependent global economic system that has been in place for many years is commonly referred to as:

Who is responsible for policing the world trading system?

The _______ was created in 1944 by 44 nations that met in Breton Woods,New Hampshire.

Which of the following refers to the exporting of goods or services to consumers in another country?

After World War II,the West committed to removing trade barriers between nations because of what experience?

What was created at the same time as the International Monetary Fund?

The __________ is a treaty designed to remove barriers to the free flow of goods,services,and capital between nations.

_______ are the two macro factors that seem to underlie the trend toward greater globalization.

Under the umbrella of GATT there have been eight rounds of negotiations among member states.The _______ was the most recent round of negotiations.

XYZ,Inc.is an auto parts distributing warehouse that exports many of its products to consumers in other countries.XYZ Inc.can be described as engaging in: