7.7 Changes as a Result of the World Economy

What is the term used to describe the process of relocating a business's services or processes to a foreign country?

• Outsourcing

• Offshoring

• Globalization

• Economic restructuring

Answer explanation

The term used to describe the process of relocating a business's services or processes to a foreign country is 'Offshoring'. This involves moving operations overseas to take advantage of lower costs or other benefits.

What is the term used when a business contracts out a service or job to an external provider to reduce costs and increase efficiency?

• Offshoring

• Outsourcing

• Globalization

• Economic restructuring

Answer explanation

Outsourcing is the term used when a business contracts out a service or job to an external provider to reduce costs and increase efficiency.

What is the term used to describe the decrease in cost per unit of production as companies get larger?

• Economies of scale

• Comparative advantage

• International division of labor

• Agglomeration

Answer explanation

Economies of scale refer to the decrease in cost per unit of production as companies get larger, making it the correct term for this scenario.

What is the term used to describe how different countries utilize their comparative advantage to specialize in different economic activities?

• Offshoring

• Outsourcing

• International division of labor

• Agglomeration

Answer explanation

The term used to describe how different countries utilize their comparative advantage to specialize in different economic activities is International division of labor.

What are special economic zones designed to do?

• Promote global trade

• Increase urban blight

• Decrease foreign investment

• Reduce economic development

Answer explanation

Special economic zones are designed to promote global trade by offering incentives and benefits to attract foreign investment and boost economic development.

What is the primary focus of export processing zones?

• Importing and exporting different products

• Manufacturing goods for local consumption

• Attracting foreign investment

• Prioritizing the exportation of goods

Answer explanation

Export processing zones prioritize the exportation of goods, attracting foreign investment and promoting economic growth through exports.

What is the term used to describe the chain reaction of additional spending that occurs after an original investment?

• Agglomeration

• Growth pull

• Multiplier effect

• Just in time delivery

Answer explanation

The correct term for the chain reaction of additional spending after an original investment is the 'Multiplier effect' which leads to an increase in overall economic activity.

What is the production method that emphasizes mass production of standard goods in a large factory?

• Fordism

• Post-fordism

• Offshoring

• Outsourcing

Answer explanation

Fordism is the production method that emphasizes mass production of standard goods in a large factory, making it the correct choice in this context.

What is the term used to describe the clustering of different economic activities and industries in a specific geographic area?

• Offshoring

• Agglomeration

• Growth pull

• Comparative advantage

Answer explanation

Agglomeration refers to the clustering of different economic activities and industries in a specific geographic area.

What is the concept that involves delivering materials, parts, or products precisely when they are needed for production?

• Economies of scale

• Comparative advantage

• Just in time delivery

• International division of labor

Answer explanation

Just in time delivery involves delivering materials, parts, or products precisely when they are needed for production.