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Exam 3: Doing Business in Global Markets

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Question 1

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A fast-growing form of foreign direct investment is ______________ which are government controlled investments in foreign companies.

A) sovereign wealth funds
B) multinational wealth funds
C) government mutual funds
D) government wealth management derivatives

E) A) and D)
F) A) and B)

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Question 2

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If two nations have a dispute over an international patent,the World Trade Organization may be asked to mediate and provide a decision within one year's time.

A) True
B) False

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Question 3

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The largest importer in the global market today is:

Differences in electrical systems throughout the world can impair a U.S.firm's ability to sell its products to other countries.

The Quinoa seed is in high demand in wealthier countries such as the U.S.and Japan.Approximately 97% of all Quinoa production comes from small farmers in Bolivia and Peru who farm at high elevations-8,000 feet or higher.The seed is considered highly nutritious.Mostly grown and harvested in Bolivia and Peru,and sold to markets in other countries,the seed is now considered an important __________ for these nations.The governments of Bolivia and Peru are hopeful that this product will increase the quality of life of their farmers.

An advantage of forming a joint venture is:

One characteristic of an international joint venture is all parties sharing the risk of a major project.

One advantage of licensing is the relatively low cost of entering a foreign market.

If your business has an outstanding product,exporting offers a quick,easy,no hassle way to improve your profitability.

McHugh Corporation of Ireland and Enomoto Enterprises based in Japan recently produced a new electric car with rechargeable batteries that can be driven at high speeds for long distances.They have shared the investment,each contributing important technological expertise to the effort.These firms entered into a(n) ____ to build this car.

You sell paint products and accessories for painters.Recently,you were in contact with merchants from India who have taken an interest in your products and are willing to talk more about entering into a contractual deal to purchase your goods.This opportunity may be just the thing to get your business over its slump,because you learned from your Introduction to Business class that very few barriers exist between U.S.and Indian markets.

In the Connecting Across Borders box titled "McDonald's: Over 100 Cultures Served" McDonald's,the largest food franchise in the world,continues to tweak its business and marketing model to appeal to the tastes of the markets in the 117 countries that it serves.One unique product offering adopted in Hong Kong is:

__________ is the practice of selling a product in foreign countries for a lower price than the good is sold in the producing country.

In order to level the playing field in trade between the U.S.and China,U.S.policymakers have called upon China's government to allow the Yuan (China's currency) to float freely,as other world currencies.Through government regulation,China maintains an undervalued currency,which results in:

The objectives of the North American Free Trade Agreement (NAFTA)include allowing free immigration between Canada,Mexico and the U.S.

If visitors from Germany spend money at Orlando,Florida's Disney World,it will increase the U.S.'s unfavorable balance of payments.

An exchange rate is the value of one nation's currency relative to the currencies of other nations.

A risk unique to firms with direct investment in a foreign county is the potential takeover of the firm's assets by the government of that country.This takeover is called a(n) :

Just about anything that can be sold in the United States can also be sold to buyers in other countries.

To understand legal and regulatory conditions and be successful in global markets it's often useful to contact: