Question 1

Each country in NAFTA sets its own tariffs to the rest of the world.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is the primary focus of the African Union (AU) ?

Accepted Answer

A)   FDI influx
B)   democracy
C)   economic integration
D)   intrazonal trade relationsE) A) and B)
F) All of the above

Question 3

Are commodity agreements effective? Why or why not?

Accepted Answer

Commodity agreements used to be influent...

Question 4

Toyota has been successful in Europe by exporting cars to Europe as well as designing and manufacturing cars in Europe for the European market.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following recently threatened the future of the EU's common currency?

Accepted Answer

A)   refusal of the UK to use the euro
B)   failed mergers and acquisitions
C)   debt crisis in Greece
D)   human rights issuesE) B) and D)
F) All of the above

Question 6

When free mobility of factors of production is added to a common market,the result is a customs union.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following groups of countries is most likely to form a regional trading group?

Accepted Answer

A)   India, Argentina, France
B)   Canada, United States, Mexico
C)   Brazil, Ukraine, Japan
D)   Spain, South Africa, MongoliaE) B) and D)
F) None of the above

Question 8

Under the WTO agreement,________.

Accepted Answer

A)   a dispute resolution mechanism allows countries to bring grievances to the WTO against countries that levy inappropriate trade discrimination measures
B)   there is no dispute resolution mechanism except for trade involving environmental products
C)   countries are allowed to place trade barriers on member countries with no particular justification, because like GATT the WTO has no enforcement mechanism
D)   tariffs are permitted to be levied by developed countries against developing countries but not against each otherE) A) and B)
F) A) and C)

Question 9

Which of the following statements most accurately describes the relationship between trading groups and MNEs?

Accepted Answer

A)   Trading groups have no influence on the size of the regional market.
B)   Regional trading groups can define the rules under which companies must operate within that region.
C)   Companies never need to change their organizational structure to take advantage of regional trading groups.
D)   Regional trading groups have no influence on an MNE's strategy since they operate worldwide.E) A) and B)
F) None of the above

Question 10

What are the rules of origin and regional content provisions of NAFTA?

Accepted Answer

Because NAFTA is a free trade agreement ...

Question 11

The EU organization that ensures consistent interpretation and application of EU treaties is the ________.

Accepted Answer

A)   European Commission
B)   Council of Ministers
C)   Court of Justice
D)   Council of Treaties and LawsE) A) and D)
F) All of the above

Question 12

NAFTA is a good example of ________.

Accepted Answer

A)   trade divestment
B)   trade diversion
C)   the theory of trade disruption
D)   the theory of trade implementationE) A) and B)
F) A) and C)

Question 13

Which of the following primarily triggered Toyota's investment in the European Union?

Accepted Answer

A)   Europeans demanded affordable, high quality cars from Japan.
B)   A common currency gave Europeans more buying power.
C)   The EU lowered trade barriers on foreign auto imports.
D)   Japan and the EU formed a free trade agreement.E) All of the above
F) None of the above

Question 14

Production location is not an important choice when doing business in the European Union.

Accepted Answer

A) True 
 B)False

Question 15

Most MNEs generate a majority of their revenues in their home regions.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is Walmart's competitive advantage in Mexico?

Accepted Answer

A)   Walmart purchased all Mexican retail chains and eliminated competitors.
B)   Walmart is able to transfer its "everyday low prices" concept to Mexico.
C)   Walmart offers affordable, unique products for niche markets in Mexico.
D)   Customers prefer to buy from American companies instead of Mexican companies.E) All of the above
F) None of the above

Question 17

One of the reasons that neighboring countries tend to ally is similar consumer tastes.

Accepted Answer

A) True 
 B)False

Question 18

The formation of CARICOM has primarily been triggered by the desire of Jamaica,Trinidad,and Tobago to expand the region's market size and attract more FDI.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following accurately identifies a difference between GATT and the WTO?

Accepted Answer

A)   GATT could enforce member compliance with agreements, but the WTO cannot.
B)   At its inception, GATT had more member nations than the WTO currently has.
C)   GATT withdrew the most-favored-nation clause, but the WTO reinstated it.
D)   GATT rules did not cover trade in services, but the rules of the WTO do.E) A) and B)
F) All of the above

Question 20

What is the difference between a free trade agreement and a customs union? Provide examples of each in your answer.

Accepted Answer

The goal of an FTA is to abolish all tar...

Exam 8: Cross-National Cooperation and Agreements

Toyota has been successful in Europe by exporting cars to Europe as well as designing and manufacturing cars in Europe for the European market.

Correct AnswerverifiedShow Answer

The formation of CARICOM has primarily been triggered by the desire of Jamaica,Trinidad,and Tobago to expand the region's market size and attract more FDI.

Correct AnswerverifiedShow Answer

One of the reasons that neighboring countries tend to ally is similar consumer tastes.

Correct AnswerverifiedShow Answer

Which of the following primarily triggered Toyota's investment in the European Union?

Correct AnswerverifiedShow Answer

Production location is not an important choice when doing business in the European Union.

Correct AnswerverifiedShow Answer

Which of the following is the primary focus of the African Union (AU) ?

Correct AnswerverifiedShow Answer

Each country in NAFTA sets its own tariffs to the rest of the world.

Correct AnswerverifiedShow Answer

What is the difference between a free trade agreement and a customs union? Provide examples of each in your answer.

Correct AnswerverifiedThe goal of an FTA is to abolish all tar...View AnswerShow Answer

Which of the following is Walmart's competitive advantage in Mexico?

Correct AnswerverifiedShow Answer

When free mobility of factors of production is added to a common market,the result is a customs union.

Correct AnswerverifiedShow Answer

Are commodity agreements effective? Why or why not?

Correct AnswerverifiedCommodity agreements used to be influent...View AnswerShow Answer

Which of the following groups of countries is most likely to form a regional trading group?

Correct AnswerverifiedShow Answer

What are the rules of origin and regional content provisions of NAFTA?

Correct AnswerverifiedBecause NAFTA is a free trade agreement ...View AnswerShow Answer

The EU organization that ensures consistent interpretation and application of EU treaties is the ________.

Correct AnswerverifiedShow Answer

Most MNEs generate a majority of their revenues in their home regions.

Correct AnswerverifiedShow Answer

Which of the following recently threatened the future of the EU's common currency?

Correct AnswerverifiedShow Answer

Under the WTO agreement,________.

Correct AnswerverifiedShow Answer

Which of the following accurately identifies a difference between GATT and the WTO?

Correct AnswerverifiedShow Answer

Which of the following statements most accurately describes the relationship between trading groups and MNEs?

Correct AnswerverifiedShow Answer

NAFTA is a good example of ________.

Correct AnswerverifiedShow Answer

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The goal of an FTA is to abolish all tar...
View Answer

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Commodity agreements used to be influent...
View Answer

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Correct Answer
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Because NAFTA is a free trade agreement ...
View Answer

Correct Answer
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