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Exam 3: Doing Business in Global Markets

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Question 141

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The purchase of U.S.based Anheuser-Busch,by Belgian brewer InBev is an example of foreign direct investment. Foreign direct investment involves the purchase of property,business(s),or another form of investment by a foreign company,in another nation other than where the company originates.In this situation,a large Belgian company purchased the assets of another company,in the same industry.

A) True
B) False

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Question 142

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Granting a foreign company the right to manufacture your product or to use your firm's trademark in return for a fee is called:

A) A joint venture.
B) A foreign subsidiary.
C) Licensing.
D) Outsourcing.

E) A) and B)
F) None of the above

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Question 143

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Last year,the nation of Kwansai reported that it had a favorable balance of trade even though it imported $11 billion worth of goods.This indicates that Kwansai:

The keiretsu tradition in Japan serves as a:

Franchising is popular both domestically and internationally.

__________ is the exchange of merchandise or services for other merchandise or services without the exchange of money.

The "China price" means the market value that U.S.firms place on products that they export to China.

The nation of Redland reported that its imports for the previous year were $4 billion greater than its exports.During the same period,Redland reported a favorable balance of payments.This information suggests:

Countries often use trade protectionism measures to protect their domestic industries from foreign competition.

Jill works as a flight attendant for an international airline.While in China,it is convenient for Jill to find look-alikes in famous brands of watches,purses,clothing,and golf clubs.In fact,she does her Christmas shopping there and even buys good quality items for auctioning at her son's pre-school events back in the U.S.Jill's actions:

Nikkei Auto Parts testified before Congress defending the company against an accusation that it was dumping auto parts on the U.S.market.In her testimony,the president claimed ________________.Using traditional guidelines,Congress determined that Nikkei was not dumping.

Contract manufacturing is when a firm pays foreign manufacturers to produce its product.The Foreign manufacturer places the domestic company's label on the products.

The U.S.government continues to be committed to free-trade agreements,as evidenced by the more recent passage of CAFTA.The future goal of U.S.free trade advocates is:

Any corporation that exports at least 50% of its total output can be classified as a multinational corporation.

An example of a U.S.import would be the purchase of oil by U.S.companies from Saudi Arabia. U.S.imports include goods and services that originate in another country purchased by a U.S.citizen or government.

One advantage of licensing is the relatively low cost of entering a foreign market.

Japanese auto manufacturers,such as Toyota and Nissan,have invested billions of dollars in the United States by building new factories,warehouses,and offices.These investments increase "favorably" the balance of payments for the United States. The balance of payments is the difference between money coming into a country from exports and money leaving the country from imports plus money flows from other sources,including foreign investments.

India and Russia are emerging markets that present enormous business opportunities.

Today,over 90% of the companies doing business globally believe it is important for their employees to have experience working in other countries.

Hennessy Hardware,a U.S.retailer,buys much of its inventory from Asian countries.Hennessy Hardware would benefit if the value of the dollar ________ relative to the currencies of the countries from which Hennessy imports.