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WorksheetsIGCSE Business Studies - 6.3 The International Economy Quiz
Total questions: 22
Worksheet time: 7mins
What is the best definition of globalisation?
The reduction of international trade barriers
The process of businesses operating only in their home country
The movement towards a more interconnected and interdependent world economy
The use of tariffs to restrict imports
Which of the following is a key reason for globalisation?
Increased trade barriers
Improvements in communication and transport technology
Government restrictions on foreign investments
Decreased demand for foreign goods and services
How can globalisation create opportunities for businesses?
It allows businesses to expand into new markets
It reduces competition from foreign businesses
It prevents businesses from outsourcing production
It eliminates currency exchange risks
Which of the following is a potential threat of globalisation to businesses?
Reduced consumer choice
Higher costs of production
Increased competition from foreign businesses
Government bans on international trade
What is a multinational company (MNC)?
A company that operates in multiple cities within one country
A company that has production or business operations in more than one country
A company that only exports products but does not have operations abroad
A business that is owned by the government
One advantage of becoming a multinational company is:
Limited access to global markets
Reduced consumer base
Spreading risks across different countries
Higher transport costs
How can MNCs benefit a host country?
By reducing job opportunities
By investing in infrastructure and technology
By increasing local business competition
By limiting foreign exchange earnings
Which of the following is a potential drawback of MNCs in a host country?
Repatriation of profits to the MNC’s home country
Increase in local employment opportunities
Increased foreign investment in the country
Improved access to goods and services
How can MNCs negatively impact local businesses?
By providing more variety of goods
By investing in local economies
By increasing market competition, making it harder for local firms to survive
By increasing employment rates
Which of the following is a reason for the growth of MNCs?
Strict government regulations on foreign investment
Decreasing global population
Expansion into new markets to increase sales and profits
Higher import tariffs
Which stakeholder group benefits the most when a business becomes a multinational?
Local businesses
Employees in the home country
Shareholders of the company
Government of the host country
Why might governments encourage MNCs to operate in their country?
To increase local unemployment
To attract foreign direct investment (FDI)
To reduce exports
To weaken their economy
If the exchange rate of a country’s currency appreciates, what happens to the price of its exports?
Prices decrease
Prices remain the same
Prices increase
Exports become more profitable
A depreciation in a country’s currency means:
The currency has increased in value relative to other currencies
The currency has decreased in value relative to other currencies
The country has introduced new currency notes
Exchange rates remain constant
If the exchange rate depreciates, how does it affect importers?
Imports become cheaper
Imports become more expensive
There is no impact on imports
Imports increase in quantity
If the exchange rate appreciates, how does it affect exporters?
Export prices increase, making them less competitive
Export prices decrease, making them more competitive
No impact on exports
Export profits increase
A stronger currency can negatively affect businesses that:
Rely on importing raw materials
Depend on exporting goods
Operate only in their domestic market
Are multinational corporations
If a country’s exchange rate depreciates, how does it affect tourism in that country?
Tourism increases as it becomes cheaper for foreigners
Tourism decreases as it becomes more expensive for foreigners
Tourism remains unchanged
Only domestic tourism is affected
How does currency appreciation affect an importing business?
Imports become cheaper
Imports become more expensive
Imports are unaffected
Imports become unavailable
If the exchange rate depreciates, how might this affect a business’s profitability?
Profitability increases for exporters
Profitability decreases for exporters
Profitability remains unchanged
Exporting businesses face reduced demand
If a country's currency appreciates, how might that impact businesses in the country?
Imported raw materials become cheaper
Imported raw materials become more expensive
Overseas competitors products become more expensive for domestic customers
Overseas competitor's products become more affordable for domestic customers
If a country's currency depreciates, how would this impact domestic companies who export?
Sales increase as exports become cheaper
Sales decrease as exports become more expensive
Sales remain unchanged
The business stops exporting
