1. An international U.S. based company sets up a production unit in a developing country with poor environmental regulations. This contributes to:
the noblesse oblige situation.
the inequity aversion.
the global tragedy of the commons.
the Friedman effect
2. Throughout the 1990s, the amount of foreign direct investment directed at both developed and developing nations increased dramatically. This trend reflects:
a slowdown in global economic activity.
the increasing share of the U.S. in the total FDI stock.
the decline in cross-border flows of foreign direct investment.
the increasing internationalization of business corporations.
3. Globalization is criticized because it increases the power of _____.
governments to own enterprises
unskilled labor to form labor unions
supranational organizations over nation-states
nation-states to regulate markets and reduce competition
4. Which of the following is NOT a consequence of the reduction in trade barriers and restrictions on FDI since 1950?
Firms are dispersing parts of their production process to global locations to drive down production costs and increase product quality.
The economies of the world's nation states are becoming more intertwined.
Nations are becoming more independent of each other for important goods and services.
The world has become significantly wealthier since 1950.
5.A common law system is different from a civil law system because:
a common law system is based on religious teachings, while a civil law system is based on cultural traditions.
a common law system is very rigid, while a civil law system tends to be more flexible.
in a common law system a judge relies on legal codes to make rulings, while in a civil law system a judge relies on his intuition and moral reasoning to make judgments.
in a common law system a judge has the power to interpret the law, while in a civil law system a judge has the power only to apply the law.
7. Which of the following areas of international trade is regulated by the Foreign Corrupt Practices Act?
Making and performance of commercial contracts in international trade.
Preventing bribery and unethical acts in the conduct of international business.
Establishing a set of safety standards to which a new product must adhere.
Controlling the mafia activity that hinders trade in Russia, Japan, and the U.S.
8. Which of the following is a measure that is developed by the United Nations to measure the quality of life in different nations?
Gross national income
Human Development Index
Purchasing power parity
Gross domestic product
9. According to Hernando de Soto, which of the following factors is essential for the developing world to be able to reap the benefits of innovation and entrepreneurship?
Detailed state planning
Restricting direct investment by foreign enterprises
Strong property rights
Market regulation
10.Which of the following refers to the extent to which individuals can move out of the strata into which they are born?
Caste stratification
Class system
Social mobility
Individual potential
11.Which of the following is an example of ethnocentrism?
A manager in India looks down upon his subordinates because they are from a lower caste, compared to him.
An upper-middle-class woman talks rudely to a sales person, because she looks down upon individuals belonging to the working-class.
An American manager criticizes the cultural practices of Saudi Arabia, when he is sent there on business, because it differs from his own cultural norms.
A French business owner, who plans to expand his market to China, conducts a detailed cultural study of China to customize his marketing campaign.