PT Global Economics for Managers

Which theory states that patterns of international trade change across new, maturing, and standardized stages?

• Product life cycle theory

• Strategic trade theory

• Factor endowment theory

• Sustainability theory

What is the financial environment in which exchange rates and payments for goods and services are conducted?

• International monetary system

• Stock exchange

• Commodity exchange

• Intercontinental exchange

What happens to a country's real exchange rate and nominal interest rate as the price level increases, assuming all other factors are unchanged?

• Exchange rates depreciate; interest rates decrease.

• Exchange rates appreciate; interest rates increase.

• Exchange rates appreciate; interest rates decrease.

• Exchange rates depreciate; interest rates increase.

What is the easiest method nonfinancial companies use to handle currency fluctuations?

• Currency diversification

• Export sales

• Foreign direct investment

• Commodity trading

Which strategy minimizes the risk of unanticipated changes in future exchange rates?

• Currency swap

• Spot transaction

• Sensitivity analysis

• Speculation

A company is looking for a location with an abundance of ground-breaking individuals, firms, and universities.

Which type of strategic goal is this company demonstrating?

• Market-seeking

• Efficiency-seeking

• Innovation-seeking

• Natural-resource seeking

What advantage comes with not sharing benefits with late entrants?

• Laggard advantage

• Late-mover advantage

• First-mover advantage

• Early-mover advantage

Which entry mode is a non-equity arrangement for a company contemplating entry into a foreign market?

• Joint-venture

• Green-fields

• Acquisitions

• Licensing

What size commitment is required for a non-equity mode of entry into a foreign market?

• Small commitment

• Larger commitment

• No commitment

• Standard commitment

Which view claims that the phenomenon of globalization was initially driven by the desire of Western economies to exploit their power through multinational enterprises?

• The long-run historical view

• The new-force view

• The pendulum view

• The balanced surplus-deficit view