Fundamentals of Exporting (1)

Which of the following is the formula for Gross Domestic Product (GDP)?

• GDP = C + G + I + (X + M)

• GDP = C + G + I - (X - M)

• GDP = C + G + I + (X - M)

• GDP = C - G + I + (X - M)

Which of the following is NOT a potential benefit of diversifying into foreign markets?

• Increased sales

• Higher profits

• Lower market vulnerability

• Increased market vulnerability

In a licensing agreement, who grants the right to use intellectual property?

• The licensee

• The licensor

• The franchisee

• The customer

Which of the following is a potential drawback of a joint venture?

• Reduced production costs

• Product innovation

• Managerial control implications

• Expanding into foreign markets

Which of the following is a component of Foreign Direct Investment (FDI)?

• Equity capital

• Reinvested earnings

• Intra-company loans

• All of the above

In franchising, what does a franchisee typically pay to the franchisor?

• Only ongoing royalties

• An initial start-up fee and annual licensing fees

• A share of the franchisee's equity

• Only the cost of goods sold

Sustainable growth is a function of what?

• Sales

• Profitable Sales

• Export Sales

• Profitable Export Sales

Which of the following factors is considered an internal determinant of export/market expansion performance?

• Cultural similarity

• Government regulations

• Management characteristics

• Economic similarity

Which of these is NOT one of the three pillars of sustainable growth?

• Operational

• Political

• Financial

• Organizational

If there are weaknesses in any one or more of the pillars, it does not mean that an exporter cannot have commercial success in the foreign market.

• True

• False