Chapter 3 Quiz Global Business

1. 1.______ is the ability to produce a specific product more efficiently than any other product.

• Absolute Advantage

• Specialization

• Relative Advantage

• Comparative Advantage

2. 2.By definition, every country has a(n) _____ advantage in some product.

• relative

• absolute

• comparative

• superior

3.Purchasing products or materials in other nations and bringing them into one's own country is

• trading

• balancing

• exporting

• importing

4.Selling and shipping raw materials or products to other nations is called

• exporting

• alien trading

• importing

• tariffing

5.If Germany exports $100,000 of sauerkraut to Jamaica and purchases $100,000 of Blue Mountin coffee beans from Jamaica, Germany has

• an overall favorable balance of trade

• an overall unfavorable balance of trade

• a favorable balance of trade with Jamaica

• neither a favorable nor an unfavorable balance of trade with Jamaica

6.An unfavorable trade balance is called a(n)

• balance of trade

• trade deficit

• currency devaluation

• balance of payments

7.When a country imports more than it exports it has a(n) _____

• trade surplus

• favorable balance of trades

• favorable exchange role

• unfavorable balance of trade

8.If the U.S. exports $100 worth of timber to Nigeria and imports $80 worth of diamonds, the U.S. has a(n) _______

• unfavorable balance of trade

• trade deficit

• trade surplus

• negative cash flow

9.When a country exports more than it imports, it has a(n) ________

• trade deficit

• favorable balance of trade

• unfavorable exchange rate

• unfavorable balance of trade

10.Another name for an import duty is a(n) ________

• tariff

• embargo

• devaluation

• quota