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According to the 2013 BRIC Markets, which country has the highest GNI per capita?


A) Brazil
B) China
C) India
D) Russia

E) None of the above
F) A) and B)

Correct Answer

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A company with the most experienced production employees and the lowest unit costs in its industry indicates that it had benefited from


A) learning effects.
B) experience curve efficiencies.
C) economies of scope.
D) economies of scale.

E) C) and D)
F) A) and C)

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Trade leads are accessed most often through contacts.

A) True
B) False

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When Wayne opened his business many years ago, most businesses operated only within one country.  But now thanks to __________, businesses increasingly take advantage of cross-border activities.


A) born-global businesses
B) globalization
C) economic freedom
D) economic liberty

E) All of the above
F) A) and B)

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Globalization explains the increasing similarity of markets around the world.

A) True
B) False

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Increasing sales in international markets is one of many ways to recoup a firm's investments in research and development.

A) True
B) False

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An example of a trade intermediary most suited for small businesses is an export remarketer.

A) True
B) False

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What are the differences and similarities of exporting and importing?

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Differences: Exporting involves the sale...

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The U.S. Department of Industry provides information for entrepreneurs considering global operations.

A) True
B) False

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Entrepreneurs decide to go global to expand their opportunities, but sometimes they are forced to enter foreign markets to compete with firms that have already done so .

A) True
B) False

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Which government organization is an excellent source information about analyzing markets, financing and planning strategy?


A) TradePort
B) Small Business Administration
C) Export Assistance Center
D) Department of Commerce

E) A) and B)
F) None of the above

Correct Answer

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In Antonio accepts the offer of the Canadian grocery to sell his American-made pasta in Canada, he will be:


A) exporting.
B) importing.
C) offshoring.
D) forming an international strategic alliance..

E) A) and C)
F) A) and B)

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Describe the role trade intermediaries play in assisting small businesses that choose to go global. Identify the types of trade intermediaries that are most useful to small businesses.

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Perhaps the easiest way to break into in...

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Products that sell at home usually require little or no adaptation to be well received in foreign markets.

A) True
B) False

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For most small businesses, the primary motivation for going global is to


A) develop new market opportunities.
B) reduce the costs of doing business.
C) gain access to resources that are important to the firm's operations.
D) capitalize on special features of location.

E) A) and C)
F) A) and B)

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Learning effects occur when


A) mistakes are made and then new solutions found.
B) insights gained by employees enhance their work performance.
C) economies of scare are present.
D) companies take advantage of experience curve efficiencies.

E) None of the above
F) A) and D)

Correct Answer

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The primary motivation for expansion into European markets is to be closer to sources of raw materials.

A) True
B) False

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China, India and Russia are classified as moderately challenging according to the World Bank's Ease of Doing Business Index.

A) True
B) False

Correct Answer

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International franchising is a variation on the theme of


A) exporting.
B) importing.
C) foreign licensing.
D) international strategic alliances.

E) B) and C)
F) A) and D)

Correct Answer

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Match the term with its definition. Some terms may not be used.

Premises
A strategy that involves accessing foreign labor through contracts with independent providers
The unauthorized use of a company's intellectual property or manufacture of its products
Insights gained from experience that lead to improved work performance
Allowing a company in another country to purchase the rights to manufacture and sell a company's products in international markets
The expansion of international business
An agreement issued by a bank to honor a draft or other demand for payment when specified conditions are met
The company selling licensing rights
The potential for political forces in a country to negatively affect the performance of businesses operating within its borders
Per-unit savings gained from repeated production of the same product
Selling products produced inthe home country to customers in another country
Selling a standard package of products, systems, and management services to a company in another country
A wholly owned subsidiary formed from scratch in another country
A document indicating that a product has been shipped and the title to that product has been transferred
A trip organized to help small business owners meet withpotential foreigh buyers and establish strategic alliances in an international market
Fees paid by the licensee to the licensor for each unit produced under a licensing contract
The purchase by a business in one country of a company located in another country
Efficiencies that result from expansion of production
The company buying licensing rights
An agency that distributes a company's products on a contract basis to customers in another country
Selling products produced in another country to buyers in the home country
A strategy that involved relocating operations abroad
A combination of efforts and/or assets of companies in different countries for the sake of pooling resources and sharing risks
The probability that a country's government will mismanage its economy in ways that hinder the performance of firms operating there
The value of one country's currency relative to that of another country
Small companies launched with cross-border business activities in mind
Responses
Licensor
Economies of scale
Globalization
Exporting
Importing
Born-global firms
Political risk
Experience curve efficiencies
Foreign licensing
Counterfeit activity
Trade intermediary
Letter of credit
Bill of lading
Greenfield venture
Learning effects
Offshoring
Royalties
Economic risk
International outsourcing
Trade mission
Licensee
Exchange rate
International franchising
International strategic alliance
Cross-border acquisition

Correct Answer

A strategy that involves accessing foreign labor through contracts with independent providers
The unauthorized use of a company's intellectual property or manufacture of its products
Insights gained from experience that lead to improved work performance
Allowing a company in another country to purchase the rights to manufacture and sell a company's products in international markets
The expansion of international business
An agreement issued by a bank to honor a draft or other demand for payment when specified conditions are met
The company selling licensing rights
The potential for political forces in a country to negatively affect the performance of businesses operating within its borders
Per-unit savings gained from repeated production of the same product
Selling products produced inthe home country to customers in another country
Selling a standard package of products, systems, and management services to a company in another country
A wholly owned subsidiary formed from scratch in another country
A document indicating that a product has been shipped and the title to that product has been transferred
A trip organized to help small business owners meet withpotential foreigh buyers and establish strategic alliances in an international market
Fees paid by the licensee to the licensor for each unit produced under a licensing contract
The purchase by a business in one country of a company located in another country
Efficiencies that result from expansion of production
The company buying licensing rights
An agency that distributes a company's products on a contract basis to customers in another country
Selling products produced in another country to buyers in the home country
A strategy that involved relocating operations abroad
A combination of efforts and/or assets of companies in different countries for the sake of pooling resources and sharing risks
The probability that a country's government will mismanage its economy in ways that hinder the performance of firms operating there
The value of one country's currency relative to that of another country
Small companies launched with cross-border business activities in mind

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