Introduction to Business

Chapter 10: Business in a Global Economy

Chapter Practice Review Quizzes

1
What is international trade?
A)the development of economies in the third world
B)the exchange of goods and services between countries
C)the placing by a company of offices and facilities in several countries
D)the fluctuating exchange rate between currencies of different countries
2
Which is NOT a reason for importing an agricultural crop?
A)The crop can be produced in your own country more cheaply.
B)Your country does not have the right climate to grow the crop successfully.
C)Shipping is no longer prohibitively expensive.
D)A higher quality crop can be produced outside your country.
3
Which types of products do other countries mostly buy from the U.S.?
A)fuels
B)clothes
C)toys
D)agricultural
4
What is a balance of trade?
A)a trade surplus
B)a trade deficit
C)importing or exporting the services of professionals
D)the difference in value of a country's imports and exports
5
Which is NOT true about specialization?
A)To specialize means to focus on one area, activity, or good.
B)Countries that specialize trade their particular product for every other good.
C)Specialization is bad for a country's economy or standard of living.
D)Countries that specialize have a comparative advantage.
6
Which country is NOT matched with its standard currency?
A)Japan - yen
B)Canada - dollar
C)India - rupee
D)Mexico - dolare
7
Which is a way you pay for goods and services?
A)trade
B)exchange rate
C)currency
D)specialization
8
Which is true of currency trading?
A)Currency is bought and sold on the foreign exchange market.
B)When a currency's value falls, it appreciates.
C)Rates stay the same almost all the time.
D)All currencies are about equal in value.
9
How can you compare exchange rates?
A)If a country's currency is higher than another's, it has more buying power.
B)If a country's currency is higher than another's, it has less buying power.
C)It is impossible to compare the value of two different currencies.
D)Look at the number amount to compare two currencies.
10
Which is a benefit of countries competing in the same market?
A)Competition often leads to trade disputes.
B)Competition forces businesses to become more efficient, innovative, and productive.
C)Cheap labor overseas can threaten jobs at home.
D)A country can become too dependent on another country for a certain product.
11
Which is NOT true of countries with protectionist policies?
A)Foreign trade of any kind is prohibited.
B)National defense programs are more secure.
C)Jobs at home are more secure.
D)Domestic businesses are sheltered from unfair foreign competition.
12
Which term refers to a tax placed on imported goods?
A)quota
B)barrier
C)tariff
D)embargo
13
Which is a disadvantage to free trade?
A)Countries can raise their standard of living.
B)Consumers have more choices.
C)Cultural understanding and cooperation among countries improves.
D)Foreign markets can threaten domestic markets.
14
Which is NOT true of forming trade alliances?
A)Trade alliances stimulate growth.
B)Everyone agrees that making alliances is a positive thing.
C)Making alliances has significantly increased trade between nations.
D)Alliances are made in order to eliminate trade barriers.
15
Which is NOT a country involved in NAFTA?
A)United States
B)Mexico
C)Dominican Republic
D)Canada
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