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Chapter 4 and 5
Chapter 4/5 Questions World Trade
| Question | Answer |
|---|---|
| If a nation has the ability to produce a product at lower cost than other countries, that nation has | a comparative advantage. |
| Although it is rare, a country that is the sole producer of a product has: | an absolute advantage |
| Specialization of production among nations: | allows ea. nation to focus on producing what it's best,consumers have access to most effic producers of goods & services they want to buy, & is the basis of intern'l trade & is major means of raising the standard of living for people throughout the world. |
| What does NOT affect the U. S. balance of payments? | congressional budget actions |
| U. S. firms operating abroad must conform to: | U. S. law., international regulations, and host country law. |
| As a result of U. S. ability to grow wheat, there is a surplus. What is the most profitable short-term method to handle the surplus? | export the wheat |
| At the end of the year, a country with limited resources determined that the amount of goods it imported was approximately 30 percent more than the amount of domestically produced goods it exported. The country has experienced: | an unfavorable balance of trade. |
| To help reverse an unfavorable balance of payments, a country might: | start a campaign to encourage foreign tourists. |
| Business firms that invest in foreign countries may be contributing to their own country’s: | unfavorable balance of payments. |
| Obstacles to international trade that occur due to uncertain transportation, poor communications systems, and unreliable utility systems are examples of: | weak infrastructure. |
| The price of imported goods is increased by | a devaluation of a nation’s currency |
| A floating exchange rate: | varies according to market conditions |
| The international business arrangement whereby Saudi Arabia sells oil to Japan in return for fresh water would be an example of: | countertrade. |
| The lender of last resort for troubled nations is the: | International Monetary Fund (IMF). |
| A tax on imports is a(n): | tariff. |
| A foreign firm given the right to right to produce, sell, or utilize a trademark, patent, or process in exchange for royalty payments is a(n): | license holder. |
| The Small Business Administration defines a small business as: | ALL ARE TRUE a. independently owned and managed. b. a firm that is not dominant in its industry. c. a firm that meets industry-specific size standards for income or number of employees |
| The federal government agency that is set up to work with small businesses is the: | SBA. |
| Which of the following industries tends to attract small business? | ALL ARE TRUE a. retailing b. agriculture c. services d. construction |
| Home-based businesses: | leverage the internet and the availability of technology to communicate. |
| A description of the firm’s target market and marketing plan, as well as detailed financial forecasts is known as: | the financial and marketing section. |
| A description of why the company was founded and what it intends to do accomplish its goals is known as: | mission and vision. |
| The section of the business plan that acknowledges and outlines a strategy for dealing with uncertainty is known as: | assessment of risks. |
| The who, what, where, when, why, and how are answered in: | the executive summary |
| The most widely used form of business ownership is: | sole proprietorship |
| Additional capital is most easily obtained if the form of ownership is a: | corporation. |
| Limited financial liability is the most important advantage of which form of ownership? | corporation. |
| A corporation in which employees share in whatever profit their company earns is known as: | employee-owned corporations. |
| These types of firms are known as the backbone of American business: | family-owned business |
| These types of organizations are commonly found in sectors such as museums, libraries, and hospitals: | not-for-profits. |
| When a group of wheat farmers collectively purchases a grain elevator, this is an example of: | cooperative ownership. |
| If the city of Los Angeles owns a parking garage on Main Street, the garage is said to be: | privately owned. |
| These types of firms result when private investors are unwilling to invest in a high-risk project: | cooperative ownership. |
| These types of firms are commonly found among agricultural businesses: | cooperatives. |
| When two or more firms combine to form one company, we say that the firms have: | merged. |
| When one firm purchases the property and assumes the liabilities of another firm, there has been a(n): | acquisition. |
| If a sporting goods manufacturer combines with a firm that operates sporting goods retailers, this would be an example of: | a vertical merger. |
| If this sporting goods manufacturer combined with a food company, this would be an example of: | a conglomerate merger. |
| If this sporting goods manufacturer combines with a manufacturer of tennis nets, this would be an example of: | a divestiture. |
| One advantage of purchasing a franchise is: | the franchisee gets a tested business model. |
| When managers or a group of stockholders buy up all of a firm’s stock, the firm then becomes: | a privately owned corporation. |
| When two firms in the same industry merge, it is called a(n): | horizontal merger. |
| horizontal merger. | alien corporation. |
| Stockholders who have a prior claim to dividends and assets are known as: | preferred stockholders. |
| The tier of management responsible for coordinating the day-to-day operations of a firm is: | supervisory management. |
| The purpose of a business plan should be to: | a. all ARE TRUE b. create a document that can be shown to potential investors, lenders, or suppliers. c.decide upon the business’s organization& structure. d.spell out marketing and financial plans. e.clarify the entrepreneur’s ideas for a business. |
| If one firm acquires the property and assumes the obligations of another, it is called a(n): | acquisition. |
| Employee ownership: | ALL ARE TRUE a. is situation in which a firm’s workers buy shares of stock in the business. c. means employees can share in whatever profits their company earns. d. is growing. |
| When a government agency or unit owns and operates an organization, it is known as: | public ownership. |
| The formal document that must be submitted to the state in order to form a corporation is known as: | a corporate charter |
| The group who is elected by stockholders and who hires top management is called: | the Board of Directors |
| The owners of a corporation are known as the | stockholders |
| To ensure that small businesses receive a reasonable portion of government procurement contracts, certain government contracts (or portions of those contracts) are reserved for small businesses in what are known as: | set-aside programs. |
| Business incubators: | are generally sponsored by local community agencies. b. provide shared space and services for new small businesses. c. often offer management counseling and in-house mentors. ALL ARE TRUE |
Created by:
tiffanie1719
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