QUESTION Rajesh owns a company based in Kentucky that sells solar-powered cooling systems. Although business is marginal in other warm-weather countries of the world due to various tariffs, the company has brisk sales with Mexico. What is Rajesh’s business benefitting from? A) dumping B) the NAFTA C) the Mercosur D) embargoes E) APEC ANSWER […]
QUESTION Aside from the dynamics of supply and demand among currency traders, what is the key driver of currency exchange rates? What will be an ideal response? ANSWER Answer: Changing economic conditions among countries drive the currency exchange rate. Explanation: Because of changing economic conditions, the values of currencies fluctuate in relation to one […]
QUESTION What region of the world has the highest level of bribery in business? A) South America B) Africa C) Middle East D) Asia E) Eastern Europe ANSWER Answer: B Explanation: B) In a 2009 survey, seven African countries were mentioned by at least 23 percent of businesspeople who reported paying a bribe. In […]
QUESTION Expropriation would have the greatest impact on a U.S. businessperson involved in what type of foreign business model? A) importing/exporting B) licensing C) joint venture D) foreign subsidiary E) outsourcing ANSWER Answer: D Explanation: D) A subsidiary has the most exposure to seizure of a company’s assets under expropriation.
QUESTION Determining the development status of a country is based on its level of economic growth, condition of its infrastructure, and availability of resources. Which of the following less-developed countries has high economic growth but insufficient infrastructure and resources? A) Somalia B) France C) India D) Haiti E) Uganda ANSWER Answer: C Explanation: C) […]
QUESTION Country X has devalued its currency by 8 percent. Which U.S. business structure engaged with Country X will realize the most benefit from this situation? A) franchiser B) licenser C) subsidiary D) importer E) joint venture ANSWER Answer: D Explanation: D) Prices for goods produced by Country X will decline relative to others […]
QUESTION Joan is under pressure from U.S. headquarters to seal a lucrative contract with a company in Russia. Negotiations have gone well, and Joan’s knowledge of Russian culture has helped. During a dinner meeting, a Russian executive solicits a bribe. What is the highest risk Joan faces in her response to this situation? A) violating […]
QUESTION Jabez is a successful U.S. businessman who recently purchased a small coffee plantation in a totalitarian country. He knows it’s a gamble, but the quality of the coffee beans is almost unmatched. Which of the following poses the largest potential risk for Jabez? A) devaluation B) corruption C) expropriation D) time orientation E) infrastructure […]
QUESTION Which of the following is NOT a method that countries use to limit the import of goods and services? A) import quotas B) revenue tariffs C) protective tariffs D) floating exchange rates E) embargoes ANSWER Answer: D Explanation: D) Floating exchange rates affect the values of currencies and are driven by supply and […]
QUESTION Which of the following is NOT an example of trade protectionism? A) tariffs B) government regulations C) import quotas D) dumping E) embargoes ANSWER Answer: D Explanation: D) Trade protectionist actions such as quotas are employed to prevent harmful activities such as dumping.
