C211
- Which political view of foreign direct investment (FDI) is most widely used by governments in the current
international business environment?
Radicalism
Protectionism
Communism
nationalism - Which factors predict the degree of rivalry between a pair of competitors? 2 choices
Market commonality
Cost structure
Resource similarity
Organizational structure - Which factors predicts how local firms in emerging economics will respond to multinational competitors?
Competitive assets and industry pressures to globalize
Formal and informal institutions
Market dominance and market fragmentation
Cooperation and signaling - During which stage of the product life cycle do sales and profits gradually increase before seeing more
dramatic increases?
Introduction
Maturity
Growth
Decline - Which factor determines the foreign exchange rate any currency?
Universal trade of the currency
Supply and demand for the currency
The age of the currency
Business economics of the currency - Which risk must a corporation minimize if it is to effectively manage short-term currency fluctuations?
Beta risk
Hedging
Alpha risk
Transaction risk - Which policy does a country use to determine the exchange rate of their currency in relationship to
another country’s currency if they do not rely on market forces?
Clean float rate policy
Fixed rate policy
Flexible rate policy
Floating rate policy - Which term refers to trading currencies and currency derivatives in order to earn profits and help make
prices efficient?
Investing
Brokering
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C211 OA Global Economics Exam 2022/2023
Day trading
Speculation
- Which type of advantage is gained by a company based on where it operates?
Lifecycle-specific
Innovation-specific
Institution-specific
Location-specific - Who gains from erecting significant entry barriers for other entrants?
Late mover
Early movers
Laggard
First movers - Which strategy for entering into a foreign market has the lowest degree of risk?
Wholly-owned subsidiary
Joint venture
Foreign acquisition
Licensing - What is a non-equity mode involving some type of contractual agreement?
Minority joint venturing
Direct exporting
Licensing
Acquisition - After the Lehman Brothers collapse, the federal Reserve stood ready to lend financial institutions
funds. When the Federal reserve did this, it was acting in its role as a lender of last resort. Which type of
group has this role?
Informal institution
Nongovernmental organization
Formal institution
Government agency - What is the comprehensive free-trade settlement among Canada, US, and Mexico, that addresses
issues of protecting workers rights, the environment and reducing tariffs and non-tariff trade barriers?
NAFTA
ASEAN
AMEA
Mercosur - What is one of the core propositions underpinning an institution-based view of global business?
A political system should establish controls of the financial sector
Countries should provide tariff protection
If formal constraints are not in place, the informal constraints will guide decision making
Investment in infrastructure provides a multiplier effect in a developing economy - What is one of the core propositions underpinning an institution-based view of global business?
Investment in infrastructure provides a multiplier effect in a developing economy
Government should provide tariff protection
Managers and corporations make rational decisions within their formal and informal framework
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