, Global Business Today Global 12th Edition Hill Test
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Bank m
Answers are at the end of each chapter
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Chapter 01 m
Globalization True /
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False Questions
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1. As a result of globalization, we have been moving toward a world in which national
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meconomies are relatively self-contained entities.
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True False
2. By offering the same basic product worldwide, firms help to create a global
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market. True False
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3. A company has to be the size of a multinational giant to facilitate, and benefit
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mfrom, the globalization of markets.
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True False
4. As a result of globalization, companies rarely need to customize marketing strategies,
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mproduct features, and operating practices in different countries.
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True False
5. Globalization has resulted in greater uniformity replacing diversity across national
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markets. True False
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6. As firms follow each other around the world, they bring with them many of the
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massets that served them well in other national markets. Thus, greater diversity replaces
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muniformity.
True False
7. Substantial impediments, such as barriers to foreign direct investment, make it difficult for
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mfirms to achieve the optimal dispersion of their productive activities to locations around the globe.
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True False
8. The World Trade Organization, the International Monetary Fund and its sister institution
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mthe World Bank, and the United Nations were all created by voluntary agreement between
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mindividual nation- states.
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True False
,9. The International Monetary Fund and the World Bank were both created in 1944 by 44
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mnations that met at Bretton Woods, New Hampshire.
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True False
10. The WTO is seen as the lender of last resort to nation-states whose economies are in
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mturmoil and whose currencies are losing value against those of other nations.
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True False
11. The IMF is less controversial than its sister institution, the World
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Bank. True
m m False
12. In return for loans, the IMF requires nation-states to adopt specific economic policies
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maimed at returning their troubled economies to stability and growth.
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True False
13. Foreign direct investment (FDI) occurs when a firm invests resources in business
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mactivities outside its home country.
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True False
14. After World War II, the advanced nations of the West committed themselves to
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mincreasing barriers to the free flow of goods, services, and capital between nations.
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True False
15. The Uruguay Round, held under the umbrella of GATT, extended GATT to cover services
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mas well as manufactured goods.
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True False
16. The lowering of trade and investment barriers allows firms to base production at the
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moptimal location for that activity.
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True False
17. As a result of international trade, the economies of the world’s nation-states are
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mbecoming less intertwined.
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True False
18. The globalization of markets and production and the resulting growth of world trade,
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mforeign direct investment, and imports all imply that firms are finding it easier to protect
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mthemselves from m
the attack of foreign competitors.
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, True False
19. Containerization has revolutionized the transportation business, significantly lowering the
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mcosts of shipping goods over long distances.
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True False
20. While advances in telecommunications are creating a global audience,
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madvances in transportation are creating a global village.
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True False
21. The real costs of information processing and communication have fallen dramatically in the
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mpast two decades.
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True False
22. The Internet has been a major force facilitating international trade in
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services. True False
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23. Countries that markedly increased their share of world output from 1960 to 2010
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mincluded Germany, France, and the United Kingdom.
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True False
24. The United States accounted for a significantly larger share of the world economy in 2011
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mthan it did in the 1960's.
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True False
25. Beginning in the 1970s, European and Japanese firms began to shift labor-intensive
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mmanufacturing operations from developing nations to their home countries where labor costs
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mwere lower.
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True False
26. The stock of foreign direct investment refers to the total cumulative value of
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mforeign investments in a country.
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True False
27. Throughout the 1990s, the amount of investment directed at both developed and
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mdeveloping nations increased dramatically
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True False
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