Which political view of foreign direct investment (FDI) is most widely used by governments in the current international business environment?
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Protectionism
Which factors predict the degree of rivalry between a pair of competitors? 2 choices Market Commonality
Cost structure
Which factors predicts how local firms in emerging economics will respond to multinational competitors? Competitive assets and industry pressures to globalize Market dominance and market fragmentation
During which stage of the product life cycle do sales and profits gradually increase before seeing more dramatic increases?
Growth
Which factor determines the foreign exchange rate any currency?
Supply and demand for the currency
Which risk must a corporation minimize if it is to effectively manage short-term currency fluctuations?
Hedging
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? Fixed rate policy
Which term refers to trading currencies and currency derivatives in order to earn profits and help make prices efficient?
Speculation
Which type of advantage is gained by a company based on where it operates? Location-specific
Who gains from erecting significant entry barriers for other entrants? First movers
Which strategy for entering into a foreign market has the lowest degree of risk? Wholly-owned subsidiary
What is a non-equity mode involving some type of contractual agreement? Direct exporting
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?
Nongovernmental organization
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
What is one of the core propositions underpinning an institution-based view of global business?
If formal constraints are not in place, the informal constraints will guide decision making
What is one of the core propositions underpinning an institution-based view of global business?
Managers and corporations make rational decisions within their formal and informal framework
Which type of system allows businesses to be privately owned with a strong individualistic profit orientation?
Market economy
Which legal system is based on a religious document and religious teachings? Theocratic law
Which type of good has well-established property rights?
Private goods
Which activity disregards basic property rights?
Students play loud music in the open area between dorms
What is one type of economy that uses the market system?
Mixed economy
Which kind of outcome was Adam Smith referring to when describing the invisible hand?
Market outcomes
What does the value of the marginal product of labor for a perfectly competitive, profitmaximizing firm equal?
Rate
What is the change in total cost equal to?
Marginal cost multiplied by change in quantity
Which condition must be satisfied for a competitive firm to shut down in a short run Total variable costs are greater than total revenue
What will a competitive firm do in the short run if its average variable cost exceeds price?
It will produce to make economic profit
What is a characteristic of a monopoly's demand curve?
It is the same as the market demand curve
Which statement describes a monopoly demand curve?
It is perfectly inelastic
What is the profit maximization condition for a monopoly?
Where marginal revenue equals marginal cost
What is a characteristic of monopolistic competition?
Many firms sell differentiated products
How does self-interest influence each prisoner’s decision in the prisoner's dilemma?
Neither prisoner will likely confess
Why is studying the prisoner's dilemma applicable to business?
It demonstrates the value of mapping out a potential strategy given actions of rivals
What does an indifference curve illustrate?
The preferences of a consumer
What happens to an individual’s budget constraint if the budget decreases and prices remain the same?
The budget constraints line shifts parallel inward [Show Less]