Question 1

A black economy is most likely to be prevalent when

Accepted Answer

A)  large amounts of economic activity are in the form of legally recorded cash transactions.
B)  people engage in barter agreements to avoid paying taxes.
C)  a country's GNI per capita exceeds $30,000.
D)  the expenses of the government are less than its income.
E)  a country is in trade surplus with another foreign country.F) B) and D)
G) B) and C)

Question 2

By identifying and investing early in a potential future economic star,international firms build brand loyalty and gain experience in that country's business practices.

Accepted Answer

A) True 
 B)False

Question 3

The Peruvian development economist Hernando de Soto has argued that much of the developing world will fail to reap the benefits of capitalism until they relax the property rights offered by their legal systems.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following statements is true of purchasing power parity (PPP) ?

Accepted Answer

A)  PPP figures can be misleading because they don't consider differences in the cost of living.
B)  The PPP for different countries is adjusted (up or down) depending upon whether the cost of living is lower or higher than in Great Britain.
C)  The PPP data gives a static picture of economic development.
D)  China's GNI PPP per capita is higher than that of the United States.
E)  PPP adjustment does not allow for a direct comparison of living standards in different countries.F) B) and E)
G) None of the above

Question 5

How have new information and communication technologies,including the Internet,affected the political economy in general?

Accepted Answer

A)  They have led to the spread of communism.
B)  They have reduced a state's ability to control access to uncensored information.
C)  They have led to the collapse of democracy.
D)  They have created new conduits for the spread of closed societies.
E)  They have led to increased suppression of political and economic freedoms.F) A) and D)
G) None of the above

Question 6

Which of the following is an indicator of low human development in a country?

Accepted Answer

A)  score of 0.3 on the HDI scale
B)  rapid "democratization" of political communities
C)  large population due to a highly developed health care system
D)  giving citizens a voice in the important decisions made for the community
E)  higher GNI per capita than the United StatesF) A) and B)
G) D) and E)

Question 7

The United Nation of Amberia,a Western European country,fought on the winning side of the Cold War.Which of the following was most likely being propagated by the country by participating in the Cold War?

Accepted Answer

A)  strong business regulations
B)  communist ideologies
C)  command economies
D)  totalitarian dictatorships
E)  free marketsF) A) and B)
G) A) and C)

Question 8

Which of the following is based on three measures: life expectancy at birth,educational attainment,and average incomes based on PPP estimates?

Accepted Answer

A)  Human Development Index
B)  Gross National Income
C)  Gross Domestic Product
D)  Cost of Living Index
E)  Cash Reserve RatioF) B) and C)
G) All of the above

Question 9

Gamma Gene Incorporated has sought your opinion about the overall attractiveness of various countries as potential markets and investment sites.What would you tell them?

Accepted Answer

The overall attractiveness of a country ...

Question 10

In the context of political economy,one notable development of the past 30 years has been the spread of

Accepted Answer

A)  centrally planned economies.
B)  mixed economies.
C)  totalitarian governments.
D)  democracy.
E)  communism.F) A) and D)
G) D) and E)

Question 11

Which of the following is most likely to be true about the overall attractiveness of a country as a potential market or investment site for an international business?

Accepted Answer

A)  The potential long-run benefits of doing business in a foreign country are independent of the country's future economic growth rates.
B)  The costs and risks associated with doing business in a foreign country are highest in economically advanced democratic nations.
C)  Economic growth tends to be higher in a centrally planned command economy system than in a free market system.
D)  The risks associated with doing business are low in developing nations where the governments have huge debts.
E)  The costs and risks associated with doing business in a foreign country tend to be greater in politically unstable nations.F) A) and E)
G) A) and C)

Question 12

Social unrest and disorder are less likely to be found in countries that contain more than one ethnic nationality.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following best exemplifies a first-mover advantage?

Accepted Answer

A)  Venus Inc.has more than 50 percent market share in the telecom industry,because no other company had invested in this industry before Venus Inc.
B)  Maya won a cash discount of 75 percent on the latest NewY phone as she was the winner of a competition conducted by NewY.
C)  The level of satisfaction Simon experienced when dining at the Emerald Inn was greatest the first time,and thereafter it reduced each time he dined there.
D)  Innovative Creations Inc.was the first to exit the declining pager phone manufacturing industry and as a result,it avoided losing a lot of money.
E)  Product critiques are extremely respected by major firms,as they are the first ones to review new products and services.F) D) and E)
G) A) and E)

Question 14

The country of Baloonistan is classified as having low human development (the quality of life is poor) .This means its HDI is

Accepted Answer

A)  a score of less than 0.5 on the HDI scale
B)  Around 6.0
C)  Greater than 5.0 but less than 7.0 t Than 5.0 but less than 7.0
D)  Around 80
E)  In the bottom 60 percentileF) A) and C)
G) A) and D)

Question 15

What are the various types of risks that a business enterprise could face in doing business in a particular country?

Accepted Answer

As with costs,the risks of doing busines...

Question 16

In Samuel Huntington's thesis,global terrorism is a product of the

Accepted Answer

A)  clash of value systems and ideology between civilizations.
B)  widespread acceptance of universal global civilization.
C)  declining liberal democratic ideals.
D)  differences in the factor endowments between countries.
E)  geographical differences between nations.F) B) and D)
G) A) and B)

Question 17

The government of Greenland Republic protects its newly privatized firms from foreign competition by imposing stringent barriers to international trade and foreign direct investment.As a result of this,the newly privatized firms will

Accepted Answer

A)  continue acting like state monopolies.
B)  operate at their maximum efficiency.
C)  pay huge taxes.
D)  import raw materials and many industrial goods at low tariffs.
E)  have no control over production and pricing.F) B) and E)
G) A) and D)

Question 18

Many commentators have blamed the problems that led to the global financial crisis of 2008-2009,and the recession that followed on

Accepted Answer

A)  a lack of free markets.
B)  a lack of regulation.
C)  the political ideologies followed in the Asian countries.
D)  a strong presence of command economies.
E)  a lack of privatization and liberalization.F) A) and E)
G) A) and D)

Question 19

Although countries such as China and India are currently relatively poor,their economies are already large in absolute terms and growing more rapidly than those of many advanced nations.

Accepted Answer

A) True 
 B)False

Question 20

In the country of Mashwen,the state owns key industries such as energy and transportation.The rest of the industries are privately owned.Mashwen is a _____ economy.

Accepted Answer

A)  market
B)  planned
C)  mixed ec
D)  private ecoomy
E)  democraticF) A) and B)
G) A) and C)

Exam 3: National Differences in Economic Development

By identifying and investing early in a potential future economic star,international firms build brand loyalty and gain experience in that country's business practices.

Correct AnswerverifiedShow Answer

Although countries such as China and India are currently relatively poor,their economies are already large in absolute terms and growing more rapidly than those of many advanced nations.

Correct AnswerverifiedShow Answer

The Peruvian development economist Hernando de Soto has argued that much of the developing world will fail to reap the benefits of capitalism until they relax the property rights offered by their legal systems.

Correct AnswerverifiedShow Answer

In Samuel Huntington's thesis,global terrorism is a product of the

Correct AnswerverifiedShow Answer

In the context of political economy,one notable development of the past 30 years has been the spread of

Correct AnswerverifiedShow Answer

What are the various types of risks that a business enterprise could face in doing business in a particular country?

Correct AnswerverifiedAs with costs,the risks of doing busines...View AnswerShow Answer

The United Nation of Amberia,a Western European country,fought on the winning side of the Cold War.Which of the following was most likely being propagated by the country by participating in the Cold War?

Correct AnswerverifiedShow Answer

Social unrest and disorder are less likely to be found in countries that contain more than one ethnic nationality.

Correct AnswerverifiedShow Answer

Gamma Gene Incorporated has sought your opinion about the overall attractiveness of various countries as potential markets and investment sites.What would you tell them?

Correct AnswerverifiedThe overall attractiveness of a country ...View AnswerShow Answer

Which of the following statements is true of purchasing power parity (PPP) ?

Correct AnswerverifiedShow Answer

Many commentators have blamed the problems that led to the global financial crisis of 2008-2009,and the recession that followed on

Correct AnswerverifiedShow Answer

The government of Greenland Republic protects its newly privatized firms from foreign competition by imposing stringent barriers to international trade and foreign direct investment.As a result of this,the newly privatized firms will

Correct AnswerverifiedShow Answer

Which of the following is an indicator of low human development in a country?

Correct AnswerverifiedShow Answer

Which of the following best exemplifies a first-mover advantage?

Correct AnswerverifiedShow Answer

A black economy is most likely to be prevalent when

Correct AnswerverifiedShow Answer

In the country of Mashwen,the state owns key industries such as energy and transportation.The rest of the industries are privately owned.Mashwen is a _____ economy.

Correct AnswerverifiedShow Answer

The country of Baloonistan is classified as having low human development (the quality of life is poor) .This means its HDI is

Correct AnswerverifiedShow Answer

Which of the following is most likely to be true about the overall attractiveness of a country as a potential market or investment site for an international business?

Correct AnswerverifiedShow Answer

Which of the following is based on three measures: life expectancy at birth,educational attainment,and average incomes based on PPP estimates?

Correct AnswerverifiedShow Answer

How have new information and communication technologies,including the Internet,affected the political economy in general?

Correct AnswerverifiedShow Answer

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As with costs,the risks of doing busines...
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The overall attractiveness of a country ...
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