ADM 2320 Chapter Notes - Chapter 16: Economic Sanctions, International Monetary Fund, World Trade Organization

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4 Apr 2016

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Growth of the economy: globalization of marketing and production. Globalization of production (offshoring): refers to manufacturer"s procurement of goods and services from around the globe to take advantage of national differences in the cost and quality of various factors of production. General agreement on tariffs and trade (gatt): agreement established to lower trade barriers like high tarifs on imported goods that inhibited free flow of goods across borders. World trade organization (wto): replaced gatt in 1994. Established institution based in geneva, switzerland instead of just an agreement. Represents the only international organization that deals with the global rules of trade among nations. International monetary fund (imf): established as part of the original gatt to promote international monetary cooperation and facilitate the expansion and growth of international trade. World bank group: a development bank that provides loans, policy advice, technical assistance, and knowledge sharing services to low and middle income countries in an attempt to reduce poverty.

Related Questions

Today, in the Unitedâ States, exports are about

28 percent of GDP.

90 percent of GDP.

14 percent of GDP.

4 percent of GDP.

Which of the following statements isâ FALSE?

Sophisticated financial systems have given U.S. productive efficiency a boost.

When it comes to overall productiveâ efficiency, compared toâ Japan, Germany and the rest of the Europeanâ Union, the United States lags far behind.

Economic restructuring and investments in information technology have added to productive efficiency in the United States.

The Unitedâ States' international competitive position has been helped by its long history of widespread entrepreneurship.

One problem with the infant industry argument is that

it fails to protect domestic industries from foreign competition.

it must be approved by the Federal Reserve Board.

it must be approved by the IMF and the World Bank.

the protection is typically neverâ removed, creating a domestic monopoly.

When a tariff isâ imposed, the supply curve for the imported good

shifts upward and to the left.

shifts downward and to the right.

becomes perfectly inelastic.

does not change.

The WTO replaced the GATT in

1900.

1995.

1960.

1945.

The World Trade Organization

increases world trade by providing interest rate subsidies to foreign borrowers who buy U.S. exports on credit.

was established to settle trade disputes within the European Union.

was established to resolve disputes arising under world trade rules.

is another name for the IMF.

Trade deflection is an act that

has no impact on the amount of international trade in the world.

is illegal among all countries in the world.

decreases the amount of international trade in the world.

increases the amount of international trade in the world.

The Number of Worker Days to Produce One Cuckoo Clock or Movie Using All Available Resources
Product	United States â (WorkerminusââDays)	Switzerland â (WorkerminusââDays)
Cuckoo Clocks	8	6
Movies	12	4

Refer to the above table. Assuming constant opportunityâ costs, which of the of the following statements is correct if the rate of exchange is 1 movie for 1 cuckoo clock.

U.S. residents will gain from exporting movies and Swiss residents will gain from exporting cuckoo clocks at a rate of exchange.

U.S. residents would be willing to export cuckooâ clocks, but Swiss residents would not gain from exporting movies at this rate of exchange.

Swiss residents would be willing to exportâ movies, but U.S. residents would not gain from exporting cuckoo clocks at this rate of exchange.

U.S. residents will gain from exporting cuckoo clocks and Swiss residents will gain from exporting movies at a rate of exchange.

The balance of payments is

a summary record of aâ country's purchases and sales of goods and services in the world market.

a summary record of aâ country's economic transactions with foreign residents and governments.

the value of goods and services bought and sold in the world market.

the value of merchandise goods bought and sold in the world market.

indigowildebeest431

The largest corporation based in the United States is:

A) General Motors.
B) ExxonMobil.
C) General Electric.
D) Microsoft.

Service exports from the United States equal _____ per year.

A) less than $100 billion
B) approximately $250 billion
C) less than $350 billion
D) approximately $500 billion

In addition to agricultural products and manufactured goods, the United States is also the world's largest exporter of:

A) processed and packaged foods.
B) pharmaceuticals.
C) electronics.
D) business services and retailing.

Before entering a country, marketers need to determine if the country has the required _____ to support their marketing efforts.

A) moral code
B) legal system
C) infrastructure
D) trade bodies

In order for a marketer to operate efficiently in a foreign country, it is crucial that a stable _____ be in place to facilitate trade.

A) free trade agreement
B) tariff
C) infrastructure
D) labor force

Which of the following is not a trade barrier to an exporter?

A) Tariffs
B) Import quotas
C) Subsidies
D) Related party trade

A complete ban on the import of a product is known as a(n):

A) import quota.
B) embargo.
C) revenue tariff.
D) protective tariff.

Exchange control is an administrative barrier to international trade that:

A) requires companies that export to sell foreign currencies to the central bank or other foreign agency, and importers to buy foreign currencies from the same organization.
B) supports domestic industry through grants of money or research support.
C) completely bans the importation of a product.
D) sells products in a foreign market cheaper than they are sold domestically.

When a group of nations agree to the free trade of goods among themselves by abolishing tariffs and trade restrictions, the nations have created a:

A) common market.
B) customs union.
C) trading block.
D) free-trade area.

10.

Which of the following is not an objective of the European Union(EU)?

A) eventually remove all trade barriers to free trade among its members.
B) standardize currencies and regulations between member nations.
C) promote the basic tenets of the WTO and GATT treaty.
D) eventually evolve into an independent political entity.

11.

An organization that provides first-time exporters with expertise in locating foreign buyers, handling paperwork, and conforming to local labeling and testing laws is called a(n):

A) export facilitator.
B) export title company.
C) trade assistance corporation.
D) export management company.

12.

McDonald

ivoryturtle973

1. The high economic growth from the Industrial Revolution was characterized by

a. new opportunities to settle empty areas, particularly North America.

b. rapid technological and scientific innovation.

c. the expansion of national governments in Europe and North America.

d. a rapid increase in the accumulation of human and physical capital.

e. none of the above.

2. Periods of economic growth and prosperity can often be explained by

a. political paradigm shifts.

b. technological innovation

c. movement of capital

d. both a and b

e. both b and c

3. Prior to the onset of economic reform in the late 1980s, the Soviet Union and

most Eastern European countries allocated resources primarily by means of

a. markets.

b. national economic plans.

c. neither a nor b.

d. both a and b.

4. A major theme in the 1980s in the governments of England and the U.S.was

a. the appropriate role of government in the economy.

b. the pressure for expanding trade with former socialist block countries.

c. repressing inflation.

d. increasing employment opportunities.

e. none of the above.

5. One example of the expansion of internationalism in the 1990s was the development of a trade agreement between Canada, Mexico, and the United States. This agreement is known as

a. the GATT (General Agreement on Tariffs and Trade).

b. the IMF (International Monetary Fund).

c. the NAFTA (North American Free Trade Agreement).

d. the CMEA (Council for Mutual Economic Assistance).

6. The contemporary Chinese economy is of interest because

a. it combines central planning with a multiparty democratic political system.

b. it combines the market with a multiparty democratic political system.

c. it combines the market with a single-party political system.

d. none of the above.

7. In the analysis of the planned socialist economic systems, the concept of economic reform is usually referred to as

a. the replacement of the plan by the market after the collapse of the planning system.

b. the attempt to improve the operation of the planned economy without a significant shift toward market arrangements.

c. the frequent attempt, in the planned socialist economic systems, to introduce the industrial policy.

d. none of the above.

8. The modern approach to defining economic systems

a. is based on the isms of capitalism and socialism.

b. emphasizes resource allocation arrangements over incentive systems.

c. defines economic systems according to a number of characteristics.

d. recognizes that defining economic systems is impossible.

e. none of the above.

9. Which of the following is not a major attribute of an economic system (Based on the textbook)?

a. Organization of decision-making arrangements.

b. Mechanisms for providing information and coordination.

c. Economic policies.

d. The system's physical and human capital.

e. Both c and d are correct.

10. A planned economy is one in which

a. subunits are coordinated by directives formulated by a superior agency.

b. subunits are not induced by appropriate incentives to carry out plan directives.

c. market allocation is combined with planned allocation.

d. a ministerial system prevails.

e. none of the above.

11. Property ownership rights include

a. disposition and utilization.

b. disposition, utilization, and the right to use the products and services generated.

c. disposition, utilization, and team production.

d. disposition, utilization, and economic incentives.

e. none of the above.

12. Consumer sovereignty means that

a. central planning is absent.

b. consumers elect public officials.

c. consumers make the basic decisions on what is to be produced.

d. consumers are not affected by advertising.

e. none of the above.

13. Which of the following is not a characteristic of market socialism?

a. Centralized decision-making.

b. Market allocation.

c. State or collective ownership.

d. Combination of moral and economic incentives.

e. All are characteristic of market socialism.

14. Two factors generally believed to be important in the analysis of levels of decision-making are

a. incentives and ownership.

b. authority and information.

c. level of economic development and ideological focus.

d. all of the above.

e. none of the above

15. Moral incentives generally refer to

a. direct money payments made to participants.

b. supplements to direct money payments, such as bonuses.

c. rewards that do not give the recipient greater command over goods and services but rather serve to reward desirable behavior.

d. all of the above.

e. none of the above

16. Principals and agents are different people. An agent is a party

a. who has controlling authority in an organization.

b. who acts on behalf of a principal.

c. with equity rights in the organization.

d. a and b are correct.

e. none of the above.

17. According to the text, opportunistic behavior occurs when a lower-level unit of an organization can use its information advantage against the interests of its superiors. This form of behavior, it is argued, can take two forms:

a. indicative planning and directive planning.

b. planners' preferences and consumer sovereignty.

c. moral hazard and adverse selection.

d. a and b are correct.

e. none of the above.

18. According to the text, there are two extremes of organizational structure. These extremes are termed

a. planned or market

b. corporate or individual proprietorship.

c. association based or hierarchy based.

d. a and c are correct.

e. none of the above.

19. It is often assumed that individuals who participate in the organized activity do so within the constraints of bounded rationality. The concept of bounded rationality

means that

a. individuals may not in fact pursue self-interest.

b. individuals face a variety of limitations, for example, in the ability to process information.

c. agents will never pursue goals or objectives set by principals.

d. b and c are correct

e. none of the above.

20. Modern comparative economists would object to the definition of economic systems only in terms of property ownership arrangements, because

a. they recognize that ownership arrangements are not important.

b. there is some private ownership of property in every economic system.

c. ownership arrangements are only one aspect of the economic system.

d. resource allocation procedures are much more important than property ownership.

e. all of the above.

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ADM 2320 Chapter Notes - Chapter 16: Economic Sanctions, International Monetary Fund, World Trade Organization

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