Question 1

A pollution haven is

Accepted Answer

A)  a place where people actually like pollution and view it as a positive externality.
B)  a location with weak environmental rules that attracts manufacturing companies due to decreased costs.
C)  a place that has very low worker wages.
D)  unattractive for multinational investment because of the ambient pollution.E) All of the above
F) B) and C)

Question 2

A firm becomes a multinational enterprise when

Accepted Answer

A)  it lists its stock on a stock exchange other than the one in its home country.
B)  it undertakes foreign direct investment.
C)  it undertakes foreign portfolio investment.
D)  Any of the above.E) A) and B)
F) All of the above

Question 3

1 represents the world supply curve. Currently 10 units are imported. The Consumption distortion loss is equal to A) c + e. B) c. C) c + g + i. D) a + c + d + e." class="answers-bank-image d-inline" rel="preload" >
-The above figure shows the market for rice in Japan. S₂ represents the domestic supply curve, and S1 represents the world supply curve. Currently 10 units are imported. The Consumption distortion loss is equal to

Accepted Answer

A)  c + e.
B)  c.
C)  c + g + i.
D)  a + c + d + e.E) C) and D)
F) A) and B)

Question 4

A trade policy that allows a country to gain at the expense of other countries is called

Accepted Answer

A)  countervailing duty policy.
B)  a beggar-thy-neighbor policy.
C)  an antitrust policy.
D)  a dumping policy.E) None of the above
F) B) and C)

Question 5

The transfer price between subsidiaries that maximizes profit for the parent company

Accepted Answer

A)  is the marginal cost of the producing subsidiary.
B)  is the monopoly price of the producing subsidiary.
C)  cannot be determined in the absence of non-production cost considerations such as taxes.
D)  is the price that minimizes the purchasing subsidiary's marginal cost.E) A) and D)
F) B) and C)

Question 6

If the U.S. can produce pizza for $5 each and barrels of beer for $25 each, and Germany can produce pizza for $7 each and barrels of beer for $21 each, then

Accepted Answer

A)  each country will produce both pizza and beer.
B)  the U.S. will produce beer and trade with Germany for pizza.
C)  the U.S. will produce pizza and trade with Germany for beer.
D)  All of the above.E) None of the above
F) All of the above

Question 7

When a country opens up to free trade

Accepted Answer

A)  winners and losers are created.
B)  comparative advantage dictates that the country focus on production of some goods and services at the expense of others.
C)  the gains outweigh the losses.
D)  All of the above.E) A) and B)
F) B) and C)

Question 8

A firm engaging in rent seeking activity

Accepted Answer

A)  is breaking the law.
B)  is willing to spend up to the gain in producer surplus.
C)  is irrational.
D)  increases societal gain.E) A) and D)
F) All of the above

Question 9

If the Mexican peso (MXN) to Brazilian real (BRL) exchange rate goes from 5.9 MXN/BRL to 5.2 MXN/BRL

Accepted Answer

A)  Brazilians decrease their demand for Mexican goods.
B)  Brazilians increase their demand for Mexican goods.
C)  Mexicans decrease their demand for Brazilian goods.
D)  Not enough information to determine what happens.E) C) and D)
F) B) and C)

Question 10

A trade policy that protects domestic producers from certain actions taken by foreign governments or firms is

Accepted Answer

A)  illegal under WTO rules.
B)  called a contingent protection policy.
C)  considered a beggar-thy-neighbor policy.
D)  intended to protect domestic consumers.E) B) and C)
F) None of the above

Question 11

The cost of lobbying for an import quota in a perfectly competitive market

Accepted Answer

A)  increases the welfare loss of the quota.
B)  decreases the deadweight loss of the quota.
C)  shifts the supply curve of the good to the left.
D)  increases the consumer surplus.E) None of the above
F) A) and B)

Question 12

Levying a tariff on an imported good

Accepted Answer

A)  shifts the demand curve down for the good.
B)  shifts the supply curve up for the good.
C)  Both A and B.
D)  Not enough information to determine.E) A) and D)
F) A) and C)

Exam 17: Global Business

Levying a tariff on an imported good

Correct Answer
verified

A trade policy that protects domestic producers from certain actions taken by foreign governments or firms is

Correct Answer
verified

The transfer price between subsidiaries that maximizes profit for the parent company

Correct Answer
verified

A firm becomes a multinational enterprise when

Correct Answer
verified

When a country opens up to free trade

Correct Answer
verified

A trade policy that allows a country to gain at the expense of other countries is called

Correct Answer
verified

A firm engaging in rent seeking activity

Correct Answer
verified

-The above figure shows the market for rice in Japan. S₂ represents the domestic supply curve, and S₁ represents the world supply curve. Currently 10 units are imported. The Consumption distortion loss is equal to

Correct Answer
verified

If the U.S. can produce pizza for $5 each and barrels of beer for $25 each, and Germany can produce pizza for $7 each and barrels of beer for $21 each, then

Correct Answer
verified

If the Mexican peso (MXN) to Brazilian real (BRL) exchange rate goes from 5.9 MXN/BRL to 5.2 MXN/BRL

Correct Answer
verified

The cost of lobbying for an import quota in a perfectly competitive market

Correct Answer
verified

A pollution haven is

Correct Answer
verified

Exam 17: Global Business

Levying a tariff on an imported good

Correct AnswerverifiedShow Answer

A trade policy that protects domestic producers from certain actions taken by foreign governments or firms is

Correct AnswerverifiedShow Answer

The transfer price between subsidiaries that maximizes profit for the parent company

Correct AnswerverifiedShow Answer

A firm becomes a multinational enterprise when

Correct AnswerverifiedShow Answer

When a country opens up to free trade

Correct AnswerverifiedShow Answer

A trade policy that allows a country to gain at the expense of other countries is called

Correct AnswerverifiedShow Answer

A firm engaging in rent seeking activity

Correct AnswerverifiedShow Answer

-The above figure shows the market for rice in Japan. S₂ represents the domestic supply curve, and S1 represents the world supply curve. Currently 10 units are imported. The Consumption distortion loss is equal to

Correct AnswerverifiedShow Answer

If the U.S. can produce pizza for $5 each and barrels of beer for $25 each, and Germany can produce pizza for $7 each and barrels of beer for $21 each, then

Correct AnswerverifiedShow Answer

If the Mexican peso (MXN) to Brazilian real (BRL) exchange rate goes from 5.9 MXN/BRL to 5.2 MXN/BRL

Correct AnswerverifiedShow Answer

The cost of lobbying for an import quota in a perfectly competitive market

Correct AnswerverifiedShow Answer

A pollution haven is

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

-The above figure shows the market for rice in Japan. S₂ represents the domestic supply curve, and S₁ represents the world supply curve. Currently 10 units are imported. The Consumption distortion loss is equal to

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified