TEST BANK International Business 3rd Edition by Shad Morris
International Business, 3e (Morris)
Chapter 1 What Is Globalization?
1) Nations are increasingly connected by trade, technology and economic trends. Which of these
set of developments spurred globalization the most?
A) Tariffs, export taxes, and business incubators
B) Protectionism, subsidies, and industry cluster planning
C) Free trade agreements, express shipping, and broadband
D) Big government, increased income tax, and trade offices
Answer: C
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
2) The agreements that form the foundation of the European Union (EU) mean that a consumer in
France could easily get a German‐made BMW motorcycle, without paying the extra fees or taxes
that are traditionally attached to the purchase of a foreign product. This is an example of which
concept?
A) Global arbitrage
B) Globalized market
C) Global convergence
D) Sovereign globalization
Answer: B
Diff: 2
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Application
3) The American colonies declaring independence from the British Empire in 1776 allowed for
increased trade and business between countries with strong cultural and political differences. This
is an example of which concept?
A) Global arbitrage
B) Globalized market
C) Global convergence
D) Sovereign globalization
Answer: D
Diff: 2
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Application
1
,4) Corporation DDD likes to manufacture their phones in low-wage countries to save labor costs.
They also look for cheaper commodities made in emerging economies. What is the name of this
corporate phenomenon?
A) Local sourcing
B) Process manufacturing
C) Globalization of production
D) Corporate social responsibility
Answer: C
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Comprehension
5) HL's Chicken is a multinational restaurant chain which has been in operation for more than sixty
years. Over the decades, HL's has expanded into several continents, and many of their products
have been imitated. Their signature spices have been added to East Asian competitors' products,
especially in Thailand and South Korea where they like spicy food. This example is following
what globalization phenomenon?
A) Global arbitrage
B) Globalized market
C) Global convergence
D) Sovereign globalization
Answer: C
Diff: 2
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Application
6) A consumer goods manufacturer receives advice from an investor to reduce costs through
arbitrage. What is the manufacturer's goal?
A) Global material sourcing
B) Foreign direct investment
C) Industrial product marketing
D) Commercial sales partnership
Answer: A
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Comprehension
2
,7) Which description best fits the definition of a sovereign nation?
A) A country that governs itself rather than being controlled by a foreign power
B) A company with operations in more than one country
C) A combination of separate national markets to create one big market
D) A country moving toward open trade and free market policies
Answer: A
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
8) Which of the following is the process of sourcing land, labor, and capital from different nations
rather than obtaining everything locally?
A) Global convergence
B) 10 percent presumption
C) Globalization of production
D) Globalization
Answer: C
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
9) What term is best described as a virtual or physical setting where people exchange goods and
services?
A) Market
B) Multilateral organization
C) Emerging market
D) Sovereign nation
Answer: A
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
10) Which description best fits the definition of globalization?
A) The process of sourcing land, labor, and capital from different nations rather than obtaining
everything locally
B) The evolution of an integrated and interdependent world economy
C) The idea that only about one-tenth of activity is conducted globally while the remaining activity
is domestic
D) The search for deals on production factors across geographic boundaries
Answer: B
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
3
, 11) The term globalized market best fits which of the following descriptions?
A) A company with operations in more than one country
B) A body that establishes and enforces guidelines governing the interactions of individuals,
businesses, and governments in a globalized world
C) A combination of separate national markets to create one big market
D) A country moving toward open trade and free market policies
Answer: C
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
12) Which of the following answers gives the definition of globalization of production?
A) The process of sourcing land, labor, and capital from different nations rather than obtaining
everything locally
B) The search for deals on production factors across geographic boundaries
C) The idea that only about one-tenth of activity is conducted globally while the remaining activity
is domestic
D) The spread of common preferences across country borders
Answer: A
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
13) What is the search for deals on production factors across geographic boundaries?
A) Globalization
B) 10 percent presumption
C) Arbitrage
D) Global convergence
Answer: C
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
14) Which of the following answers best describes the term global convergence?
A) The evolution of an integrated and interdependent world economy
B) The process of sourcing land, labor, and capital from different nations rather than obtaining
everything locally
C) The search for deals on production factors across geographic boundaries
D) The spread of common preferences across country borders
Answer: D
Diff: 1
Learning Objective: 1.1 Identify the causes and consequences of globalization.
AACSB: Analytic
Bloomcode: Knowledge
4
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