International Business Quiz

False (B)

Exporting and importing

<p>importing</p> Signup and view all the answers

<p>Focal firm = Initiates international business transactions and produces offerings for global consumption Distribution channel intermediary = Provides logistics and marketing services to focal firms, both domestically and internationally Facilitator = Offers specialized support services, such as banking, legal advice, and customs clearance</p> Signup and view all the answers

<p>The potential for a company's operations and profitability to be negatively impacted by political, legal, and economic changes in a foreign country (C)</p> Signup and view all the answers

<p>True (A)</p> Signup and view all the answers

<p>Fluctuations in exchange rates</p> Signup and view all the answers

<p>internationalization</p> Signup and view all the answers

<p>Participants (B)</p> Signup and view all the answers

<p>Country Risk = The potential for a company's operations and profitability to be negatively impacted by political, legal, and economic changes in a foreign country Currency Risk = The risk of adverse fluctuations in exchange rates Commercial Risk = The firm’s potential loss or failure from poorly developed or executed business strategies, tactics, or procedures Internationalization = The tendency of companies to deepen their international business activities systematically</p> Signup and view all the answers

<p>joint venture</p> Signup and view all the answers

<p>Acquiring Existing Firms in Foreign Markets (B)</p> Signup and view all the answers

<p>True (A)</p> Signup and view all the answers

<p>It allows firms to expand their market reach and potentially gain a competitive advantage in new markets.</p> Signup and view all the answers

<p>To track the flow of money between countries, allowing them to identify potential investment opportunities. (D)</p> Signup and view all the answers

<p>True (A)</p> Signup and view all the answers

<p>It helps them understand the financial health and potential value of the firm, which is crucial for making investment decisions.</p> Signup and view all the answers

<p>Interest and dividend payments on foreign investments (A)</p> Signup and view all the answers

<p>True (A)</p> Signup and view all the answers

<p>Maximize shareholder wealth</p> Signup and view all the answers

<p>cash flows</p> Signup and view all the answers

<p>Merchandise exports = Tangible goods transported between countries Service imports = Provision of services to customers based in other countries Balance of trade = Difference between total exports and imports Factor income = Income received on foreign investments in financial assets</p> Signup and view all the answers

<p>Strengthening of the home currency (D)</p> Signup and view all the answers

<p>False (B)</p> Signup and view all the answers

<p>Counter-pricing by competitors</p> Signup and view all the answers

<p>piracy</p> Signup and view all the answers

<p>Government subsidies to domestic exporters = Increased demand for domestic goods in foreign markets Restrictions on imports (tariffs) = Increased prices for imported goods Prearranged international transactions = Limited flexibility in adjusting to currency fluctuations Weak home currency = Increased attractiveness of domestic goods to foreign customers</p> Signup and view all the answers

<p>False (B)</p> Signup and view all the answers

<p>Increased domestic demand for imported goods (D)</p> Signup and view all the answers

<p>A balance-of-trade deficit implies that a country is buying more goods from foreign countries than it is selling to them. This increased reliance on foreign production can lead to job losses in domestic industries as consumers choose cheaper imported products.</p> Signup and view all the answers

<p>An individual who borrows money (A)</p> Signup and view all the answers

<p>True (A)</p> Signup and view all the answers

<p>Stocks represent ownership shares in a company, while bonds are a form of debt that the issuing entity promises to repay at some point in the future.</p> Signup and view all the answers

<p>expected dollar value of cash flows</p> Signup and view all the answers

<p>False (B)</p> Signup and view all the answers

<p>The existence of restrictions and costs related to the movement of labor and resources. (C)</p> Signup and view all the answers

<p>The theory suggests that MNCs rise from a firm's initial home market success, gaining a foothold due to perceived advantages, and subsequently expanding internationally as the product matures.</p> Signup and view all the answers

The potential adverse effects on business from political, legal, and economic changes in a foreign country.

Risk of negative fluctuations in exchange rates affecting international transactions.

The trend of increasing economic interconnectedness among nations.

The process of deepening international business activities of firms.

The potential loss from poorly executed business strategies or decisions.

Risk associated with adverse government actions affecting business operations.

The exchange of goods and services across international borders.

Investment made by firms in foreign countries.

A business model obligating a firm to provide support in exchange for fees.

A business arrangement where two or more firms jointly own and operate a venture.

The movement of money across countries through transactions.

A summary of transactions between domestic and foreign residents.

A part of the balance of payments summarizing the flow of goods and services.

Setting up operations in foreign countries to sell products.

Individuals who oversee the balance of payments to manage international transactions.

The method of determining the value of a multinational corporation.

An organization or individual that borrows money from financial institutions.

The benefit a firm has when it can produce a good at a lower opportunity cost than competitors.

A theory explaining how firms evolve into multinational corporations (MNCs) based on market advantages.

The financial resources a bank uses to ensure creditors are covered if it liquidates assets.

All financial resources of a firm, including cash, bank balances, and accounts receivable.

Stocks are ownership shares in a company, while bonds are debts that must be repaid.

A legal permission for a firm to use another's technology in exchange for fees or royalties.

Selling products or services from the home country to customers abroad.

Procurement of products or services from abroad for local consumption.

The initiator in international business, designing and producing offerings.

A specialist firm providing logistics and marketing services for focal firms.

Procurement of products or services from suppliers located abroad.

A company engaged in financial transactions, supporting international business.

A tax imposed on imported goods, making them more expensive.

When a country imports more than it exports, potentially affecting jobs.

A currency that has depreciated, making exports cheaper but imports more expensive.

When competitors lower prices in response to a currency's depreciation.

Investors may be drawn to a country if its currency is expected to strengthen.

The absence of laws against piracy impacting international trade flows.

International trade agreements made in advance that cannot be easily altered.

Trade transactions that occur within the same company across borders.

The process to determine the value of a firm that only operates within one country, based on its expected cash flows.

The difference between a country's total exports and total imports.

Income received from foreign investments, including interest and dividends.

Tangible goods sold to other countries, such as electronics and clothing.

Intangible services provided to foreign customers, like consulting or tourism.

The average rate of return required by all of a company's investors, used as the discount rate.

Forecasted cash inflows expressed in US dollars from foreign operations or investments.

Financial support from the government to firms that export goods to international markets.