International Business and Trade Midterms

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What is the primary function of the World Trade Organization?

To promote global monetary cooperation
To ensure that trade flows as smoothly, predictably and freely as possible (correct)
To foster global sustainable development
To provide a forum for its member countries to express their views on global issues

What is the main purpose of the International Monetary Fund?

To foster global monetary cooperation and ensure financial stability (correct)
To promote regional integration among neighboring countries
To provide a forum for countries to address global issues
To facilitate international trade by eliminating trade barriers

What is the Global Capital Market?

A forum for countries to discuss global economic issues
A global financial institution that regulates international trade
An interlinking of various investment exchanges around the world (correct)
An international organization that promotes regional integration

What is the main goal of regional integration?

To upgrade cooperation through common institutions and rules among neighboring countries (D) Signup and view all the answers

What is the United Nations' primary mission?

To provide a forum for its member countries to express their views and take action on major global issues (C) Signup and view all the answers

How many member countries does the International Monetary Fund have?

190 (B) Signup and view all the answers

What is an International Licensing Agreement?

A contract between two parties from different countries, where one party grants the other party the right to use a product, technology, or intellectual property (C) Signup and view all the answers

What is the main goal of a free trade area?

To promote economies of scale and comparative advantages (B) Signup and view all the answers

What is indirect exporting?

A business sells its products to foreign customers through middlemen or intermediaries (C) Signup and view all the answers

What is a customs union?

A type of free trade area with common external tariffs (D) Signup and view all the answers

What is indirect importing?

A business purchases goods from foreign suppliers through intermediaries (B) Signup and view all the answers

What is the purpose of setting common external tariffs in a customs union?

To level the competitive playing field and address re-exports (A) Signup and view all the answers

What does international business refer to?

Any commercial activities or transactions that involve the movement of goods, services, resources, capital, people, or intellectual property across national borders (D) Signup and view all the answers

What is the main difference between international trade and foreign direct investment?

International trade involves goods and services, while foreign direct investment involves the acquisition of foreign assets (D) Signup and view all the answers

What is culture?

The beliefs, values, mind-sets, and practices of a group of people (D) Signup and view all the answers

What is economic globalization?

The widespread international movement of goods, capital, services, technology, and information (A) Signup and view all the answers

What is the main characteristic of international trade?

Involves the exchange of goods and services across international borders (D) Signup and view all the answers

What is the main characteristic of globalization?

The widespread international movement of goods, capital, services, technology, and information (D) Signup and view all the answers

What is the primary purpose of Voluntary Export Restraints (VERs)?

To limit the quantity of exports during a specified period (D) Signup and view all the answers

What type of barrier aims to limit imports through legal restrictions?

Regulatory Barrier (C) Signup and view all the answers

What is applied when an exporting producer sells goods below cost, harming domestic industries?

Anti-Dumping Duty (D) Signup and view all the answers

What type of foreign aid provides financial assistance to domestic industries?

Subsidy (C) Signup and view all the answers

What type of aid aims to promote economic growth and development in recipient countries?

Economic Aid (B) Signup and view all the answers

What is a key feature of a common market?

Free movement of services and capital within member countries (C) Signup and view all the answers

What type of aid provides humanitarian relief following natural disasters or during emergencies?

Humanitarian Aid (D) Signup and view all the answers

What is the primary goal of tariffs?

To protect domestic industries from foreign competition (D) Signup and view all the answers

What is an example of an economic union?

The European Union (Euro) (B) Signup and view all the answers

What is the outcome of quotas on imported goods?

Higher prices for consumers (D) Signup and view all the answers

What is a characteristic of a political union?

A common government with reduced national sovereignty (C) Signup and view all the answers

What is the purpose of harmonization of monetary and fiscal policies?

To imply a level of political integration (A) Signup and view all the answers