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Exam 3: Doing Business in Global Markets

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Question 131

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The nation of New Maraguay has a small commercial airplane industry that is struggling to keep up with the two large international commercial airplane manufacturers.The other nations in its trading bloc have agreed on an import quota on commercial airplanes,which limits the number of planes that any country in the trading bloc can buy from other airplane manufacturers.This strategy is necessary to help the New Maraguay's airplane manufacturer while it is in its infancy. Import quotas are designed to limit the number of a particular product that a nation can import.This is usually a strategy enacted by a nation trying to protect a weak product or grow an industry that is in its infancy.

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Question 132

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________ tariffs are designed to raise money for the government.

A) Regulatory
B) Revenue
C) Price
D) Profit

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Question 133

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The Ozark Bike Company recently entered into an agreement with a large Japanese retailer to distribute its bicycles in Japan.Ozark Bike Company sees itself in a favorable position because:

NAFTA is now over 15 years old.According to the Legal Briefcase box titled,"NAFTA or SHAFTA?" the agreement was strongly promoted by most U.S.organized labor groups.These unions still sing its praises due to the increases in manufacturing jobs in Mexico,and its ability to help deter illegal immigration. Even while in its infancy,organized labor groups in the U.S.have strongly opposed NAFTA.The U.S.has lost a significant number of manufacturing jobs to Mexico,and the agreement has not delivered on its promises such as a trade surplus with Mexico and the halting of illegal immigration.

A disadvantage of licensing is:

Global trade includes the exchange of art,sports,and cultural events.

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.

Protective tariffs are designed to raise money for the government.

Even though the U.S.exports a large ___________ of goods and services,it exports a much lower __________ of its products than many other countries do.

One of the purposes of Export Assistance Centers is to:

____________ describes an attitude held by some American business people that American culture is superior to all others.

The U.S.government is reducing Export Assistance Centers due to businesses' lack of interest in their support.

The purpose of forming strategic alliances is to share the costs of marketing new products and services to several countries.

A major force that often impeded global trade occurs when government regulations limit the import of goods and services.We call this:

Which of the following statements is a good prediction of future occurrences in global markets?

Exporting is the selling of products to another country.

Contract manufacturing is a low cost way for GAP to outsource the production of its clothing designs. Contract manufacturing involves the production of private-label goods by a foreign company to which a domestic company then attaches its brand name or trademark.

Mini-Case Since he was five years old,Rhett Tenna struggled with poor eyesight.He suffered through all the names that went along with wearing eyeglasses for most of his young life.Rhett eventually switched from traditional eyeglasses to contact lens,but he always wondered why glasses were considered to be "ugly" and not fashionable.After graduation from college,Rhett set out on a lifelong goal: to make eye wear synonymous with high fashion.He opened a specialty store called "The Eyes Have It." His marketing plan was to remove the social stigma of wearing glasses,and replace it with a sense of flair and high fashion.From the day he opened his first store,Rhett's plan met with resounding success.Today,"The Eyes Have It" has grown from that single outlet to a medium-sized company with dozens of stores located in six states,and a manufacturing plant that turns out designer frames. A recent internal audit,however,suggested a problem that Rhett had not anticipated.The study indicated that the U.S.market is just about saturated and growth of "The Eyes Have It" stores will be very limited.The audit concerned Rhett until he recognized an untapped market existed overseas.If people all over the world have the same problem,the global market opportunities are fantastic! All in favor of going global say: "The Eyes Have It"! -Initially,Rhett believed he should maintain his production facilities within the United States and simply export his designer eyeglass frames to foreign sellers.However,he lacked expertise in exporting.Rhett decided to see if the federal government could provide any help by contacting a(n) :

Current trade data indicates that the nation of Bogusland exports more to other nations than it imports.Bogusland has:

Another name for a common market is: