Competing in Global Markets

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What is the main reason for trading with other nations?

To increase competition within the country

To acquire goods that are not locally available (correct)

To reduce global market diversity

To promote national self-sufficiency

Why is Canada mentioned as a potential market of only 38 million customers?

To discourage international trade with Canada

To highlight Canada's limited purchasing power

To contrast it with the global market potential of 7 billion customers (correct)

To emphasize the challenges of operating in a small market

What concept refers to the ability of a country to produce goods at a lower opportunity cost than another country?

Comparative advantage (correct)

National self-sufficiency

Absolute advantage

Import substitution

What is the primary role of multinational corporations in global markets?

To facilitate the movement of goods, services, and investments across borders Signup and view all the answers

Why do countries engage in trade even if they are technologically advanced?

To obtain goods that are not locally available Signup and view all the answers

What does exporting mean in the context of international trade?

Selling products to another country Signup and view all the answers

What is one of the pros of free trade mentioned in the text?

Improvement in productivity through comparative advantage Signup and view all the answers

What can be a consequence of intense competitive pressure on domestic companies?

Loss of comparative advantage Signup and view all the answers

What is the theory of absolute advantage based on?

Virtual monopoly in production Signup and view all the answers

What has been a recent trend in international trade, as mentioned in the text?

Increase in small business involvement Signup and view all the answers

Competing in Global Markets - Chapter 3 Quiz

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Questions and Answers

What is the main reason for trading with other nations?

Why is Canada mentioned as a potential market of only 38 million customers?

What concept refers to the ability of a country to produce goods at a lower opportunity cost than another country?

What is the primary role of multinational corporations in global markets?

Why do countries engage in trade even if they are technologically advanced?

What does exporting mean in the context of international trade?

What is one of the pros of free trade mentioned in the text?

What can be a consequence of intense competitive pressure on domestic companies?

What is the theory of absolute advantage based on?

What has been a recent trend in international trade, as mentioned in the text?

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