国际商务-题库-Chapter-7

Ch7:ForeignDirectInvestmentCHAPTER7FOREIGNDIRECTINVESTMENTTRUE/FALSEQUESTIONS1.Manyearlytradetheorieswerecreatedatatimewhenmostfactorsofproductioneithercouldnotbemovedorcouldnotbemovedeasilyacrossnationalborders.(True;Moderate;p.204;LO1)2.Factorsofproductionincludethingssuchaslabor,financialcapital,capitalequipment,andlandornaturalresources.(True;Easy;p.204;LO1)3.Today,allfactorsofproductionareinternationallymobile.(False;Easy;p.204;LO1)4.Portfolioinvestmentisthepurchaseofphysicalassetsorasignificantamountofownershipofacompanyinanothercountrytogainadegreeofmanagementcontrol.(False;Moderate;p.204;LO1)5.Foreigndirectinvestmentisthepurchaseofphysicalassetsorasignificantamountoftheownership(stock)ofacompanyinanothercountrytogainameasureofmanagementcontrol.(True;Easy;p.204;LO1)6.Atthecoreofforeigndirectinvestmentareinternationalflowsofcapital.(True;Moderate;p.204;LO1)7.Twomainreasonsforincreasingforeigndirectinvestmentflowsoverthepastdecadeareglobalizationanddiversity.(False;Moderate;p.204;LO1)8.Forcescausingglobalizationarepartofthereasonforlong-termgrowthinforeigndirectinvestment.(True;Moderate;p.205;LO1)9.Increasingglobalizationiscausingagrowingnumberofinternationalcompaniesfromemergingmarketstoundertakeforeigndirectinvestment.(True;Moderate;p.205;LO1)10.Developedcountriesaretheprimedestinationforforeigndirectinvestmentbecausecross-bordermergersandacquisitionsareconcentratedindevelopedcountries.(True;Moderate;p.206;LO1)11.Tradebarriersandspecializedknowledgearebothexamplesofmarketimperfections.(True;Easy;p.208;LO2)12.Marketimperfectionthatcanencourageforeigndirectinvestmentisthepossibilitythatacompanywillcreateafuturecompetitorbycharginganothercompanyforaccesstoitsknowledge.Ch7:ForeignDirectInvestment(True;Difficult;p.208;LO2)13.Theeclectictheorystatesthatfirmsundertakeforeigndirectinvestmentwhenthefeaturesofaparticularlocationcombinewithownershipandinternalizationadvantagestomakealocationappealingforinvestment.(True;Easy;p.209;LO2)14.Accordingtotheeclectictheory,aninternalizationadvantageistheadvantagethatarisesfrominternalizingabusinessactivityratherthanleavingittoarelativelyinefficientmarket.(True;Easy;p.209;LO2)15.Accordingtotheeclectictheory,anownershipadvantageistheadvantageoflocatingaparticulareconomicactivityinaspecificlocationbecauseofthecharacteristicsofthatlocation.(False;Easy;p.209;LO2)16.Verticalintegrationistheextensionofcompanyactivitiesintostagesofproductionthatprovideafirm’sinputs(forwardintegration)orabsorbsitsoutputs(backwardintegration).(False;Difficult;p.209;LO2)17.IfcoffeecompanyMaxwellHouseweretoacquireacoffeeplantationinBrazil,itmightachievemarketpowerthroughverticalintegration.(True;Difficult;p.209;LO2)18.Inforeigndirectinvestment,100percentownershipofacompanydoesnotguaranteeitscompletecontrol.(True;Moderate;p.210;LO2)19.Benefitsofinvestmentbymultinationalsincludeincreasedunemployment,increasedtaxrevenues,workforcetraining,andthetransferoftechnology.(False;Moderate;p.210;LO3)20.Governmentsneverinterveneintheflowofforeigndirectinvestmentsinceitalwaysgeneratesjobs.(False;Easy;p.214;LO3)21.Values,attitudes,andbeliefsformthebasisformuchofagovernment’spositionregardingforeigndirectinvestment.(True;Moderate;p.214-215;LO4)22.Acountry’sbalanceofpaymentsisanationalaccountingsystemthatrecordsallpaymentstoentitiesinothercountriesandallreceiptscomingintothenation.(True;Easy;p.215;LO4)23.Anynation’sbalanceofpaymentsconsistsoftwomajorcomponents:thecurrentaccountandthepast-dueaccount.(False;Easy;p.215;LO4)24.Themerchandiseaccountincludesexportsandimportsoftangiblegoods.(True;Moderate;p.216;LO4)Ch7:ForeignDirectInvestment25.Theincomepaymentaccountincludesincomeearnedonhomecountryassetsheldabroad.(False;Moderate;p.216;LO4)26.Acurrentaccountdeficitoccurswhenacountryexportsmoregoodsandservicesandreceivesmoreincomefromabroadthanitimportsandpaysabroad.(False;Moderate;p.216;LO4)27.Whenacountryimportsmoregoodsandservicesandpaysmoreabroadthanitexportsandreceivesfromabroad,itexperiencesacurrentaccountdeficit.(True;Moderate;p.216;LO4)28.Thecapitalaccountisanationalaccountthatrecordstransactionsinvolvingtheimportandexportofgoodsandservices,incomereceiptsonassetsabroad,andincomepaymentsonforeignassetsinsidethecountry.(False;Difficult;p.216;LO4)29.IfaU.S.citizeninvestsintheBrazilianstockmarket,thetransactionwouldshowuponthecapitalaccountsofboththeUnitedStatesandBrazil.(True;Difficult;p.216;LO4)30.Thetwomainreasonscountriesinterveneinforeigndirectinvestmentflowsaretocontrolthebalanceofpaymentsandtoobtainresourcesandbenefits.(True;Moderate;p.216;LO4)31.Becauseforeigndirectinvestmentinflowsarerecordedassubtractionstothebalanceofpayments,anationisnegativelyaffectedfromaninitialforeigndirectinvestmentinflow.(False;Difficult;p.216;LO4)32.Onereasonahomecountrymaydiscourageforeigndirectinvestmentoutflowsistoprotectits“sunset”industries.(False;Difficult;p.218;LO4)33.Onemethodusedbyhostcountriestorestrictincomingforeigndirectinvestmentisownershiprestrictions.(True;Easy;p.219;LO4)34.Taxincentivesandinfrastructureimprovement