Chapter 6-MANA 3312 Questions and
Answers
According to the _________, if a given country is innovative and a generator of new
products, and it starts marketing such product in poorer foreign countries, and from
there it starts to FDI in such country to seize location economies, it will ultimately end up
no longer manufacturing its invention, but rather importing such product it once invented
from such poorer country. - answer product life-cycle theory
The textile industry in a nation is characterized by very strong domestic competition.
Which of the following observations of this nation's international competency is most
likely to be true? - answer The nation's textile firms will likely have a competitive
advantage in international trade
According to the Heckscher-Ohlin theory, the pattern of international trade is determined
by differences in - answer factor endowments.
U.S. exports are less capital-intensive than U.S. imports, despite the relative abundance
of capital in the country. What is this phenomenon that runs contrary to the prediction of
the Heckscher-Ohlin theory called? - answer Leontief paradox
Imagine your country can produce both products A and B more efficiently than any other
country. But also assume that you are more efficient in producing A than in producing B.
According to the concept of ABSOLUTE ADVANTAGE, your country should: - answer
produce A and B, because you are more efficient than all other countries
According to the concept of ________, it makes sense for a country X to specialize in
the production of those goods that it produces most efficiently and to buy the goods that
it produces less efficiently from other countries, even if country X has an absolute
advantage over its production: - answer comparative advantage
The following statement is TRUE: - answer If a country restricts free trade in any
way, such as import tariffs, import quotas, or subsidies, it cannot truly defend free trade,
and it is engaging in some degree of protectionism
According to the _______ perspective, countries should __________: - answer
mercantilist; export more than what they import
WalMart makes bulk purchases from its vendors and hence it is able to get better deals
than its competitors. This allows WalMart to offer greater discounts to its customers. In
this case, WalMart benefits from ____. - answer economies of scale
Answers
According to the _________, if a given country is innovative and a generator of new
products, and it starts marketing such product in poorer foreign countries, and from
there it starts to FDI in such country to seize location economies, it will ultimately end up
no longer manufacturing its invention, but rather importing such product it once invented
from such poorer country. - answer product life-cycle theory
The textile industry in a nation is characterized by very strong domestic competition.
Which of the following observations of this nation's international competency is most
likely to be true? - answer The nation's textile firms will likely have a competitive
advantage in international trade
According to the Heckscher-Ohlin theory, the pattern of international trade is determined
by differences in - answer factor endowments.
U.S. exports are less capital-intensive than U.S. imports, despite the relative abundance
of capital in the country. What is this phenomenon that runs contrary to the prediction of
the Heckscher-Ohlin theory called? - answer Leontief paradox
Imagine your country can produce both products A and B more efficiently than any other
country. But also assume that you are more efficient in producing A than in producing B.
According to the concept of ABSOLUTE ADVANTAGE, your country should: - answer
produce A and B, because you are more efficient than all other countries
According to the concept of ________, it makes sense for a country X to specialize in
the production of those goods that it produces most efficiently and to buy the goods that
it produces less efficiently from other countries, even if country X has an absolute
advantage over its production: - answer comparative advantage
The following statement is TRUE: - answer If a country restricts free trade in any
way, such as import tariffs, import quotas, or subsidies, it cannot truly defend free trade,
and it is engaging in some degree of protectionism
According to the _______ perspective, countries should __________: - answer
mercantilist; export more than what they import
WalMart makes bulk purchases from its vendors and hence it is able to get better deals
than its competitors. This allows WalMart to offer greater discounts to its customers. In
this case, WalMart benefits from ____. - answer economies of scale
