QUIZ3

1. is a contractual agreement where one firm gives another permission to

produce and market its product and brand name in exchange for a fee.

The correct answer is. Licensing

2. is an internationally supported bank that provides loans to developing

countries to help them grow

The correct answer is: A multilateral development bank

3. is the ability to produce a specific product more efficiently than any other
product.

The correct answer is Comparative advantage.

4. A___is issued by the exporter's bank, ordering the importer's bank to pay for
the merchandise.
The correct answer is: draft

5. A complete halt to trading with a particular nation or in a particular product is

called a(n)

The correct answer is: embargo.

6. A currency devaluation increases the cost of foreign goods and the cost of
domestic goods to foreign firms.
The correct answer is: decreases
7. A favorable balance of payments means that
The correct answer is total receipts exceed total payments.
8. A limit on the amount of a particular good that may be brought into a country
during a given period of time is called a(n)
The correct answer is import quota.
9. A medium-sized hardware manufacturer wants to become deeply involved in
exporting, but it does not yet wish to actually manufacture any of its products
overseas. The company wants to maintain control over its sales while gaining
experience in foreign markets. Which option would be best for this company?
The correct answer is Establishing its own sales offices in foreign countries
10.A reduction of the value of a nation's currency relative to the currencies of
other countries is called
The correct answer is a currency devaluation
11. A new country is formed in central Africa. It has no absolute advantage in
crude oil, diamonds, or wool. However, it does manufacture high-quality bows
and arrows for specialized safari adventures. Which of the following statements is
true?
The correct answer is The new country has a comparative advantage in the
production of bows and arrows
12. A restriction on the amount of a particular foreign currency that can be
purchased or sold is
The correct answer is foreign-exchange controll
13. A small country is just beginning its international trade activities. In so doing,
it wants to favorable balance of trade.
The correct answer is provide markets for its products
14.A trading company
The correct answer is provides a link between buyers and sellers in different
countries
15. All of the following are reasons against having trade restrictions except
The correct answer is: the protection of the health of citizens.
16. All of the following are ways to export a product to a foreign market except
The correct answer is: all of these answer choices are ways to export a product to
a foreign market.
17. An import duty has the effect of all of the following except
The correct answer is reducing the number of units exported
18. An organization of nations formed to promote the free movement of
resources and products among its members and to create common economic
policies is called a(n)
The correct answer is: economic community
19. Any measure imposed by a government to favor domestic products over
foreign products not involving taxes is a(n)
The correct answer is; nontariff barrier
20. Balance of payments is a
The correct answer is broader
21. Because Saudi Arabia and Australia have Saudi Arabia can specialize in the
production of crude oil and petroleum products, and Australia can specialize in
the production of wool.
The correct answer is an absolute advantage
22. gold-producing nations with some control of gold prices. These nations will
most likely model the unit after
The correct answer is OPEC