wgu c211 oa global economics quizzes all questions
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WGU C211 OA Global Economics Quizzes
(2024) Questions & Answers 100% Correct
The term "emerging economies" has replaced the term _____. - ANSWER-developing countries
The gross domestic product plus the income from non-resident sources abroad gives the ____.
- ANSWER-gross national product
More than 25% of global GDP comes from _____. - ANSWER-BRICS countries
Viewing the global economy as a pyramid, the Triad refers to _____. - ANSWER-North America,
Western Europe, and Japan
People who earn _____ a year comprise the base of the global economic pyramid. -
ANSWER-less than $2,000
What would be an example of a top down innovation? - ANSWER-Lowering prices and features
of existing products to meet emerging market needs
What is true of the Group of 20 (G-20)? - ANSWER-It only has 19 member countries.
What does the institution-based view of global business lay emphasis on? -
ANSWER-Understanding the laws and values of the firm's host nation
The resource-based view of global business differs from the institution-based view of global
business in that the resource-based view _____. - ANSWER-focuses on the internal strengths
on the firm
The liability of foreignness is the inherent disadvantage faced by _____. - ANSWER-foreign
firms in host nations due to their non-native status
What is true of globalization according to the "new force" perspective? - ANSWER-It is a
western ideology focused on exploiting and dominating the world through MNEs
The concept of _____ suggests that barriers to market integration at borders are high, but not
high enough to completely insulate countries from each other. - ANSWER-semiglobalization
The strategy of treating each country as a unique market and in total isolation is referred to as
_____. - ANSWER-localization
,MNEs from the Triad dominate the list of the 500 largest MNEs; their share has been _____. -
ANSWER-shrinking
Protectionism is similar to mercantilism as they both advocated _____. - ANSWER-government
involvement in international trade
The _____ principle advocated that governments should actively protect domestic industries
from imports and vigorously promote exports. - ANSWER-protectionism
What is a modern trade theory? - ANSWER-National competitive advantage
What trade theories divides the nations of the world into three categories? - ANSWER-product
life cycle
What was the first international trade theory to account for changes in the patterns of trade over
time? - ANSWER-product life cycle theory
In the third stage of the product life cycle theory, the _____. - ANSWER-product is standardized
What describes resource mobility as assumed by the classical theories of international trade? -
ANSWER-It is the assumption that a resource used in producing a product for one industry can
be shifted and put to use in another industry.
The theory of comparative advantage _____. - ANSWER-explains patterns of trade based on
factor endowments
Deadweight costs are net losses that occur when _____ are imposed. - ANSWER-import tariffs
_____ are government payments to domestic firms. - ANSWER-subsidies
What is true of voluntary export restraints? - ANSWER-It is an export quota levied by a country
on the quantity of its exports.
_____ are tariffs levied on imports sold below costs to drive domestic firms out of business. -
ANSWER-antidumping duties
Multinational enterprises (MNEs) are: - ANSWER-firms that engage in foreign direct investment
(FDI).
Foreign direct investment (FDI) is: - ANSWER-investment in activities that control and manage
value-added activities in foreign countries
Foreign portfolio investment (FPI) is: - ANSWER-investment in foreign stocks and bonds that do
not involve the active management of foreign assets.
,What is one advantage of FDI compared with licensing? - ANSWER-FDI provides tight control
over foreign operations
The advantages of agglomeration result from all of the following EXCEPT: - ANSWER-Fewer
competitors in the same location
An oligopoly is an: - ANSWER-industry dominated by a small number of competitors.
The primary political views on FDI are: - ANSWER-Free market and pragmatic nationalism
In addition to FDI, other ways a firm can enter foreign markets include: - ANSWER-outsource;
license and trademark; and import and export
What is the primary difference between FDI and FPI? - ANSWER-FDI is direct and FPI is
indirect.
FDI is defined as a 10% or more equity stake and FPI is less than 10%.
FDI is foreign direct investment and FPI is foreign portfolio investment.
A mortgage broker that dominates the American Southwest has decided to expand into Mexico
and several Central American countries. Its new offices in the host countries offer the same
mortgage services as in the home country. This is an example of: - ANSWER-horizontal FDI
A large-scale French dairy that produces milk, cheese, yogurt, and other related products
decides to buy a chain of mini-marts located throughout many EU countries. Their objective is to
sell their dairy products, as well as other products, through these mini-marts. This is an example
of: - ANSWER-vertical FDI
Which three countries invest the most money in other countries (FDI outflow)? -
ANSWER-United States, France, Germany
The three OLI advantages are: - ANSWER-ownership, location, internalization
A Spain-based chain of tapas bars authorizes a French company to open a chain of tapas bars
using the Spanish company's name, logo, menu, process, and advertising. This is an example
of: - ANSWER-licensing
A good example of agglomeration is: - ANSWER-hundreds of small, medium, and large
internet-based, high-tech companies all located in Silicon Valley in California.
An industry dominated by a small number of players is called: - ANSWER-an oligopoly
Firms can increase their chances of success with FDI by: - ANSWER-leveraging OLI
advantages in a way that is valuable, unique, and hard to imitate by rival firms
, assessing whether FDI is justified, in light of other options.
understanding that political realities either facilitate or constrain FDI.
FPI refers to the _____. - ANSWER-investment in a portfolio of foreign securities that do not
entail the active management of foreign assets
A vertical FDI refers to a type of FDI in which _____. - ANSWER-a firm moves upstream or
downstream at different value chain stages in a host country
FDI Stock - ANSWER-_____ refers to the total accumulation of inbound FDI in a country or
outbound FDI from a country.
OLI advantages refer to a firm's quest for _____via FDI. - ANSWER-ownership advantages,
location advantages, and internalization advantages
Internalization - ANSWER-_____ refers to the replacement of cross-border markets with one
firm locating in two or more countries.
Firms prefer FDI to licensing because FDI_____. - ANSWER-provides the firm with direct
ownership to its foreign assets
Agglomeration - ANSWER-_____ refers to the clustering of economic activities in certain
locations.
The television industry in the United States is controlled by seven giant corporations: The Walt
Disney Company, CBS Corporation, Viacom, Comcast, Hearst Corporation, Time Warner, and
News Corporation. Thus, the television industry in the U.S. is a typical _____ industry. -
ANSWER-oligopolistic
Which of the following economic perspectives on FDI has its principles rooted in Marxism? -
ANSWER-The radical view
Which of the following is a benefit of FDI to home countries? - ANSWER-Learning from
operations
_____ refers to the deal struck by MNEs and host governments, which change their
requirements after the initial FDI entry. - ANSWER-Obsolescing bargain
Costs that a firm has to endure even when its investment turns out to be unsatisfactory are
referred to as _____. - ANSWER-sunk costs
Beyond the enforcement of antitrust laws, collusion often fails because: - ANSWER-it has
incentive problems associated with the "prisoners' dilemma."
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