BUSMHR 2000Quiz1: Potential Questions and TopicsQuestion 1Today's global markets consist largely of industrial and material goods that really meet world demand; consumer products play a secondary role.True FalseQuestion 2For approximately the last half century, two important trends have been the rise of non-U.S. multinational firms and the growth of mini-multinational enterprises.True FalseQuestion 3The newest of the institutions created by individual nation-states voluntarily and whose functions are established in international treaties is ____________________. the United Nationsthe World Trade Organization the World Bank the IMFQuestion 4_______________________ is when a firm invests resources in business activities outside its home country. Capital intensive investmentOverseas selective borrowing Venture capital developmentForeign direct investmentQuestion 5Recent studies by the Organization for Economic Cooperation and Development (OECD) have concluded that for most countries, real income levels have _____________. increased for the wealthiest citizens but not for the poor increased for the poor but not for the wealthiestincreased for all levels decreased for all levelsQuestion 6National sovereignty concerns raised by critics of globalization include:a. trade is becoming more complex and requires expertise and experience of market leaders like the U.S.b. development is so fundamentally important to poorer countries that their national sovereignty concerns cannot be allowed to stand in the way of the interests of the world business community as a whole.c. unelected bureaucrats now impose policies on democratically elected governments of nation-states.d. supranational organizations like the WTO should be given powers to enforce agreements once a majority of countries agrees to the agreements.Question 7Which of the following terms best represents the system of government in a nation? Common systemPolitical system Environmental system Command system Social systemQuestion 8Collectivist-inclined totalitarian states tend to enact laws that severely restrict private enterprises, whereas the laws enacted by governments in democratic states, where individualism is the dominant political philosophy, tend to be pro-private enterprise and pro-consumer. This indicates that the:a. economic system of a country is independent of its legal system.b. legal system of a country is not influenced by the prevailing political system.c. legal system does not affect the attractiveness of a country as an investment site or market.d. all the countries have the same legal environments.e. the legal framework of a country reflects the rulers’ dominant political ideology.View Feedback: The government of a country defines the legal framework within which firms do business, and often the laws that regulate business reflect the rulers’ dominant political ideology. For example, collectivist-inclined totalitarian states tend to enact laws that severely restrict private enterprise, whereas the laws enacted by governments in democratic states where individualism is thedominant political philosophy tend to be pro-private enterprise and pro-consumer.Question 9When state officials, such as politicians and government bureaucrats, violate property rights by extorting income, resources, or the property itself from property holders, it is described as: patents violation.public action. public servitude.private action. private governance.View Feedback: Public action to violate property rights occurs when public officials, such as politicians and government bureaucrats, extort income, resources, or the property itself from property holders.Question 10The Republic Of Marwa has decided to open its economy to globalization. Which of the following will facilitate this decision of Marwa? A strong commitment to communism A strong presence of private action in the nationAdopting the Contracts For the International Sale of Goods (CIGS) Creating a national environment that promotes public action Breaking the rule of lawView Feedback: The CIGS establishes a uniform set of rules governing certain aspects of the making and performance of everyday commercial contracts between sellers and buyers who have their places of business in different nations.Question 11Initech Incorporated, a multinational giant, runs a number of diversified businesses. Which of the following can be considered as an intellectual propertyof the firm? Income arising from renting lands and buildings Profits arising from the sale of agricultural crops Interest earned by lending capital to other firmsInnovations and capabilities, and skills of the employees Investments made in raw materials and machineryView Feedback: Intellectual property refers to property that is the product of intellectual activity, such as computer software, a screenplay, a music score, or the chemical formula for a new drug.Question 12If a country wants to improve its attractiveness as a place for doing business andas an investment site, it should: oppose the rule of law. ensure that the economic activity is heavily regulated by the state.move toward a market-based system. extensively restrict property rights. avoid enforcing intellectual property laws.View Feedback: A nation with democratic political institutions, a market-based economic system, and strong legal system that protects property rights and limits corruption is clearly more attractive as a place in which to do business than a nation that lack democratic institutions, where economic activity is heavily regulated by the state, and where corruption is rampant and the rule of law is