Unit 2 Review MC Question Preview (ID: 23688)
MC Questions.
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A method of international business with the lowest risk is
a) indirect exporting
b) franchising
c) a joint venture
d) foreign direct investment
When a movie company allows its cartoon characters to be used on clothing items produced in other countries, is is an example of
a) licensing
b) management contracting
c) a wholly owned subsidiary
d) direct exporting
A joint venture exists when
a) two or more companies share a business venture
b) companies in two countries are taxed as a single organization
c) a foreign government buys imported goods or services
d) a company obtains the right to use a company name or business process
A separate foreign company owned by a parent company is called a
a) wholly owned subsidiary
b) joint venture
c) cooperative
d) municipal cooperation
Of the following statements, the one that does not describe a multinational company is that
a) its strength is that if offers a different product in each market
b) none of the these
c) it maintains both an international and local perspective
d) a country may become too dependent on it
Many people believe that multinational companies need to be regulated and controlled because
a) they may dominate a country's economy and control the political situation
b) they make too much money
c) they do not employ citizens of the host countries to a large enough extent
d) none of these
Of the following methods for getting involved in international business he one the the lowest risk is
a) management contracting
b) foreign direct investment
c) licensing
d) joint venture
Of the following methods for getting involved in international business, the one with the highest risk is
a) foreign direct investment
b) management contracting
c) joint venture
d) licensing
An organization that bonds countries together to allow a free flow of products is called
a) an economic community
b) a balance of trade agreement
c) a monopoly
d) an industry
Two reasons why importing is important are because
a) customers want the product and its cheaper from another country
b) your country has a competitive advantage and home-country products are more expensive
c) availability of parts for manufacturing and customs duties
d) none of these
A purchase agreement should include all of the following details except
a) the amount of customs duty
b) who will pay for shipping
c) how will payment be made
d) when will the items be delivered
Of the following business transactions, the only one that describe an importing activity is
a) a retailer in Sweden receives goods from Mexico to sell in a chain of stores
b) a wholesaler in Brazil packs goods for shipment to Liberia
c) a restaurant food supplier in Japan ships sushi ingredients to a restaurant in Turkey
d) none of the these
A company exported appliances to Italy. Italians did not buy the appliances because they would not work with the way Italian electrical current is supplied. The step in the exporting process the exporter did not properly complete is
a) meet the needs of customers
b) complete the transaction
c) provide products or services
d) agree on sales terms
Products that do no usually require much modification for foreign customers include
a) clothing
b) skin care products
c) laundry detergent
d) none of these
The exchange rate for a stable country
a) changes somewhat from day to day
b) is always based on the U.S. dollar
c) remains the same unless there is a political change
d) none of these
Parties that can appear before the International Court of Justice include
a) only countries
b) only companies
c) countries and companies
d) countries, companies, and individuals
A person who makes duplicate copies of a video tape of a commercial movie and then sells it would be violating a
a) copyright
b) patent
c) trademark
d) none of these
International Treaties and trade agreements may serve all of the following purposes except
a) helping to provide unity between different cultures and customs
b) helping to ensure fair competition practices between member countries
c) setting currency exchange rates
d) allowing free flow of goods and services between member countries
Of the following, the one that is not a reason for mediation or arbitration instead of court action to settle a dispute is
a) to follow legal procedures
b) to avoid the risk of discriminatory treatment in a foreign court
c) to avoid bad publicity
d) to save time
A mediator does all of the following except
a) makes a binding decision
b) makes suggestions and proposals
c) helps the parties to reach a compromise
d) addressess the substance of the dispute
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