Chapter 01 The Rise of Globalization

Name: Class: Date: Chapter 01: The Rise of Globalization Which of the following is NOT an objective of the WTO?1. With business becoming increasingly global, its success, fortunately, depends only on the domestic environment. a. True b. False ANSWER: False 2. Key aspects of globalization include the elimination of barriers to trade and information technology. a. True b. False ANSWER: True 3. The world economy is quickly shifting away from countries with emerging economies. a. True b. False ANSWER: False 4. The “soft” qualities essential to globalization include openness, protectionism, accountability, connectivity, democracy, and centralization. a. True b. False ANSWER: False 5. A sustainable decoupling process would eventually lead to a multi-polar world—a world economy in which the engines of growth could comprise the United States, the European Union, China, India, Brazil, Russia, and South Africa rather than the United States alone. a. True b. False ANSWER: True 6. The openness and proliferation of globalization and free trade rules can best be attributed to the interwar period between World War I and II. a. True b. False ANSWER: False 7. As part of the World Bank’s Strategic Framework, there are five focus areas that accommodate and facilitate the globalization process including its analytical and advisory role supporting national policies to strengthen free market institutions and infrastructure that has provided the potential for creating large gains from trade. a. True b. False ANSWER: True Page 1 Name: Class: Date: Chapter 01: The Rise of Globalization 8. For the World Trade Organization, increasing trade barriers has been one of the most simple ways to encourage trade and globalization. a. True b. False ANSWER: False 9. The foundations of the globalized business world are political—and so are the biggest threats to the system. a. True b. False ANSWER: True 10. Countries that have successfully adapted to globalization realize that they cannot succeed without highquality government management at home. a. True b. False ANSWER: True 11. In communist and state-controlled economies like those in Central Asia property rights either do not exist or are not well defined which discourages domestic and foreign investors from making long-term commitments in these countries. a. True b. False ANSWER: True 12. Globalized economies like New Zealand and Singapore rank at the top in index for absence of corruption by Transparency International. a. True b. False ANSWER: True 13. Text messaging will likely be an unimportant component of emerging economies' mobile phone usage because most people in these countries cannot read or write. a. True b. False ANSWER: False 14. Critics argue that open trade and foreign direct investment always take jobs from workers in developing economies and transfer them to workers in advanced industrial countries which leave the workers in the developing country, out of work. a. True b. False ANSWER: False Page 2 Name: Class: Date: Chapter 01: The Rise of Globalization 15. There appears to be a clear connection between economic freedom and political freedom. a. True b. False ANSWER: True 16. Brazilian Juice, a manufacturer of healthy fruit juices in Brazil, sells juice in six different countries including United States. Brazilian juice is engaging in a. economic development in United States. b. exercising nontariff barriers in Brazil. c. unfair trade practices. d. globalization. e. the World Trade Bank Group. ANSWER: d 17. Which of the following is NOT a key aspect of globalization? a. The elimination of barriers to trade b. Investment c. Financial independence d. Culture e. Information technology ANSWER: c 18. Countries that have been moving toward more open trade and free market policies are known as _____. a. African countries b. open-door economies c. industralized countries d. globalized economies e. emerging economies ANSWER: e 19. Increasingly, emerging economies are a. innovative and technologically advanced. b. sources of inexpensive labor. c. largely agricultural. d. simply copying the technologies used in more advanced economies. e. being left behind in the global economy. ANSWER: a Page 3 Name: Class: Date: Chapter 01: The Rise of Globalization 20. A sustainable decoupling process would eventually lead to _____. a. a multi-polar world b. globalization c. outsourcing d. transparency e. income inequity ANSWER: a 21. A world economy in which the engines of growth could comprise the United States, the European Union, China, India, Brazil, Russia, and South Africa rather than the United States alone can be described as a(n) __________. a. interdependent world b. industrialized world c. globalized economy d. multi-polar world e. diverse world ANSWER: d 22. According to the authors, which of the following is NOT true regarding globalization lessons for developing countries? a. Import oriented nations must switch to concentrate on domestication. b. Export oriented nations must diversify their market to include major emerging economies. c. Countries emphasizing exports should base their strategy on their true competitive advantage. d. For countries with large populations, the size of the domestic market remains most important. e. Overindulgence can lead to disaster. ANSWER: a 23. Which of the following is NOT a main purpose of the IMF? a. Provide a forum for cooperation on international monetary problems b. Facilitate the sustainable growth of international trade c. Promote exchange rate stability d. Lend countries foreign exchange when needed e. Provide long-term low-interest social sector and infrastructure loans ANSWER: e Page 4 Name: Class: Date: Chapter 01: The Rise of Globalization 24. What was the initial primary role of the World Bank? a. To aide in the reconstruction of Europe after World War II b. To provide low-interest mortgage loans to minorities c. To try to avoid a repetition of the disastrous economic policies that had contributed to the Great Depression. d. To deal primarily with tariff negotiations e. To provide loans and take equity position in private companies ANSWER: a 25. The International Bank for Reconstruction and Development performs which of the following functions? a Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing . foreign aid funds provided by rich nation members b Provide loans and take equity position in private companies of developing countries and works toward . developing capital markets in those economies c Supports reconstruction and restructuring of member countries utilizing funds raised in international . capital markets d Provides political risk coverage for private investments made in developing countries . e Works on issues related to foreign investment disputes . ANSWER: c 26. The Multilateral Investment Guarantee Agency performs which of the following functions? a Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing . foreign aid funds provided by rich nation members b Provide loans and take equity position in private companies of developing countries and works toward . developing capital markets in those economies c Supports reconstruction and restructuring of member countries utilizing funds raised in international . capital markets d Provides political risk coverage for private investments made in developing countries . e Works on issues related to foreign investment disputes . ANSWER: d Page 5 Name: Class: Date: Chapter 01: The Rise of Globalization 27. The International Finance Corporation (IFC) performs which of the following functions? a Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing . foreign aid funds provided by rich nation members b Provide loans and take equity position in private companies of developing countries and works toward . developing capital markets in those economies c Supports reconstruction and restructuring of member countries utilizing funds raised in international . capital markets d Provides political risk coverage for private investments made in developing countries . e Works on issues related to foreign investment disputes . ANSWER: b 28. Which of the following is NOT an objective of the WTO? a. Reviewing national trade policies b. Acting as a forum for trade negotiations c. Naming commissioners to local trade organizations d. Settling trade disputes e. Administering trade agreements ANSWER: c 29. Trade without discrimination, freer trade, predictability, promotion of fair competition, and _____ are the five principles of the multilateral trading system. a. integrated capital markets b. encouragement of economic reform in developing countries c. liberalization of the trading system d. nontariff trade e. establishment of "most favored nation" status ANSWER: b 30. In Brazil, if there are government organizations that create strong incentives for private investment and operate under a system of checks and balances that function best in a democratic system of government, they could be classified as which of these? a. Transparent organizations b. Antitrust corporations c. Adaptive institutions d. Emerging markets e. Capital markets ANSWER: c Page 6 Name: Class: Date: Chapter 01: The Rise of Globalization 31. To sustain globalization, nations must build institutions that support all of the following EXCEPT a. democratic systems of government. b. free markets. c. command economies. d. independent judiciaries. e. a free press. ANSWER: c 32. The most recent devices that enable the greatest ease in portability and accessibility of information are ______. a. magazines b. newspapers c. advertisements d. smart phones e. computers ANSWER: d 33. In India, several politicians are working very hard toward a system of full disclosure and openness that aims to avoid any semblance of corruption and cronyism. These efforts can be described as creating a system focused on _____. a. politics b. integrity c. accountability d. transparency e. democracy ANSWER: d 34. Which of the following is NOT true regarding competitive markets? a. Successfully globalized economies strive to attain competitive markets at home. b. Governments try to minimize the role of state-owned enterprises in market economies. c. Regulations that promote free domestic markets also tend to promote globalization. d. Antitrust laws must be eliminated if competitive markets re to be sustained. e. Antitrust laws interfere with the natural growth of successful businesses. ANSWER: d Page 7 Name: Class: Date: Chapter 01: The Rise of Globalization 35. Illicit dealings undermine economic performance by doing all of the following EXCEPT: a. decreasing costs. b. raising competition. c. thwarting competition. d. reducing transparency. e. raising insecurity. ANSWER: a 36. ABC Technology touts in their advertisements that their technology can transfer huge amount of data and other information in a second via the Internet. This describes ABC’s _____ in technology. a. bandwith b. digital server c. digital divide d. gigabytes e. Y2K ANSWER: a 37. The rapid fall in prices of digital IT equipment and services may a. reduce the importance of IT in the global economy. b. spell the end of the digital era. c. make digital divide a myth. d. reduce the availability of bandwidth in developed economies. e. localize the production of goods and services. ANSWER: c 38. Of the following, which is NOT true regarding the Internet and cell phone era? a. Fortunately, the next billion users will be the same as the first billion b. The majority of users will be from developing countries c. Text messaging will likely predominate emerging economies; mobile phone usage d. Countries are skipping the use of land-line technology and jumping to wireless systems e. Developing countries may “leapfrog” an entire generation of technology ANSWER: a 39. All of the following are arguments against globalization EXCEPT: a. it may lead to an increase in the appearance of old industries. b. it may lead to a loss of control over economic policies and developments. c. it may lead to an erosion of communities. d. it can be a force of exploitation and injustice. e. it can cause job losses and stagnant wages. ANSWER: a Page 8 Name: Class: Date: Chapter 01: The Rise of Globalization 40. The only way workers in industrialized countries can compete with their counterparts in the developing world will be through: a. increased use of the cost leadership strategy. b. increased diversity within the organization. c. increased empowerment of employees. d. increased productivity by using technologically-intensive manufacturing technologies. e. increased flat organization structure. ANSWER: d 41. An office uses printer paper made primarily of recycled paper. This is an example of a ______ policy. a. future sourcing b. global warming c. next-generation consumer hook d. digital divide e. sustainable development ANSWER: e 42. Which of the following is NOT true regarding results from a survey by the World Bank on corporate social responsibility (CSR)? a. CSR practices are now a significant factor in determining where multinational companies conduct business. b. 90% of the companies surveyed have board-approved policies on environmental management. c. 90% of multinationals will make their decisions based on CSR issues with regard to foreign direct investment. d. CSR issues consistently implemented for the long term lead to sustainable business and development. e. CSR includes issues such as labor rights, corruption, human rights, community health, and land rights. ANSWER: c 43. Successive waves of globalization include characteristics such as the expansion of trade, the diffusion of technology, extensive migration, and _____. a. improvements in country infrastructure b. increased employee morale c. improved healthcare d. financial independence e. cross-fertilization of diverse cultures ANSWER: e Page 9 Name: Class: Date: Chapter 01: The Rise of Globalization 44. Which of the following is NOT true regarding globalization? a. It guarantees that quality of life for all people will increase. b It creates winners and losers. . c. It has the potential to increase the quality of life for people. d Some multinational companies will utilize globalization may try to pay substandard wages to the . workers they employ in developing countries. e. Export barriers may need to be imposed by the WTO to help regulate the actions of multinational companies. ANSWER: a 45. All of the following countries can be considered globalization “winners” EXCEPT: a. China b. North Korea c. India d. Brazil e. South Africa ANSWER: b 46. _______ refers to a fundamental global shift in which industrialized country-dependent developing economies begin to grow based on their own underlying economic strengths rather than the ups and downs of the world’s richest countries. ANSWER: Decoupling 47. A world economy in which the engines of growth could comprise several major industrialized and emerging market economies such as the United States, the European Union, China, India, Brazil, Russia, and South Africa rather than the United States alone is called ______. ANSWER: multi-polar world 48. The World Bank was conceived at the ________ Conference in 1944. ANSWER: Bretton Woods 49. A stock exchange where long-term financial instruments such as stocks and bonds can be bought and sold refers to _______. ANSWER: capital markets 50. The rules, enforcement mechanisms, and organizations that support market transactions are called ______. ANSWER: institutions 51. A system of responsibility in which an authority, such as the government, is answerable for its actions refers to ________. ANSWER: accountability Page 10 Name: Class: Date: Chapter 01: The Rise of Globalization 52. National laws aimed at maintaining competition in all sectors of the economy and preventing monopolistic behavior of firms are called _______. ANSWER: antitrust laws 53. The period of transformation that adjusts lifestyles to make the Internet and wireless technologies a part of everyday life refers to the ______. ANSWER: digital era 54. The _______ is a system of interlinked documents contained and accessed via the Internet. ANSWER: web 55. Economic development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs, whether environmentally, socially or economically is called ______. ANSWER: sustainable development 56. Differentiate between the International Monetary Fund and the World Bank as institutions facilitating globalization. ANSWER: Student answers will vary. 57. Analyze the impact of transparency on globalization. ANSWER: Student answers will vary. 58. Identify and describe any two key policy measures that make globalization sustainable. ANSWER: Student answers will vary. 59. Given the rapid advancements in technology in developed countries and fast pace of globalization, it is not possible to bridge the global digital divide. Do you agree with this statement? Why or why not? Explain. ANSWER: Student answers will vary. 60. What are the best ways industrialized countries can support globalization's "losers"? Support your position using examples. ANSWER: Student answers will vary. Page 11 Name: Class: Date: Chapter 01: The Rise of Globalization Scenario – T & M Computers Thomas Benson and Matthew Roderick started a small computer business ten years ago in Rapid City, South Dakota. Armed only with determination and innovative designs, Thomas and Matthew were driven to achieve success for their company, T & M Computers. Their hard work has indeed, paid off. Since the inception of the company, the two owners have watched their business grow and demand for their products increase. Four years ago due to this high product demand, they went international with their business operations. Thomas and Matthew now have international business operations in Singapore, France, Turkey, and Great Britain. Further operational expansion is anticipated within the next year and the company plans to begin operations in Spain, Greece, and Italy. The owner’s hard work and dynamic ideas have proven quite profitable for the company. Thomas and Matthew are pleased with how their operation has grown into becoming a major international business worthy of competing with Intel and Microsoft. T & M Computers may well be the next giant recognized in the field of computer software. 61. T & M Computers are conducting international business operations in world areas, which have recently undergone financial turmoil. Of the following, which organization is most likely to provide assistance in providing global financial stability? a. International Monetary Fund b. The United Nations c. The World Bank d. The Global Center for Financial Restructuring e. The World Trade Organization ANSWER: a 62. Which one of the following would T & M Computers least expect to be a negative influence from the sovereign governments within the nations where their business operations are located? a. Military hostilities b. Protectionist policies c. Promotion of economic growth and job creation d. Stiff environmental standards e. Stringent immigration policies ANSWER: c 63. T & M Computers plans to begin operations in areas that recently needed financial assistance and undergone certain levels of reconstruction and reorganizing to their economies. Which organization listed below is most likely to have played an integral part in this? a. The World Trade Organization b. The World Bank Group c. The International Development Association d. The International Finance Corporation e. The sovereign government of Greece ANSWER: b Page 12 Name: Class: Date: Chapter 01: The Rise of Globalization Scenario – The Everline Corporation The Everline Corporation is a multinational business that provides state-of-the-art digital communication capabilities to its global customers. Originally operating as a U.S. domestic business based in Duluth, Minnesota, Everline quickly seized on the opportunity provided by international expansion. Within two years, the corporation had expanded into fourteen foreign nations found throughout the Middle East, Europe, Asia, and South America. Everline understands the vital importance of offering effective and affordable communication products to its customers. It realizes the value consumers place on being able to communicate with businesses without delays or hassles. The corporation recognizes its customers need to quickly and efficiently communicate with others in the global marketplace of today. Fueled by its staff of innovative and highly skilled communication engineers, the future for Everline looks more and more promising. Communication needs around the globe continue to grow and this business stands ready to fill the demand. With net profits expected to reach one billion dollars in the next year, this company is decidedly reaping the rewards of its hard work. 64. The Everline Corporation is currently conducting its international communication business during a period of time that is experiencing rapid changes and challenges. Individuals and organizations are adjusting their lifestyles and methods of operations to fully utilize the modern communication technologies available in the marketplace. The time period Everline is currently operating under is best classed as which one of the following terms? a. Digital proliferation b. Modern communication era c. Digital divide d. Communication decade e. Digital era ANSWER: e 65. There is a perceived economic gap among the various foreign customers of the Everline Corporation. This is thought to be mainly the result of the level of access or lack thereof to modern digital information technologies experienced within these individual countries. Considering this perceived economic gap, Everline’s operations may be experiencing influence identified as which of the following? a. Digital stagnation b. Digital era c. Digital divide d. Bandwidth technology era e. Web revolution ANSWER: c Page 13 Name: Class: Date: Chapter 01: The Rise of Globalization 66. The Everline Corporation’s future business plans include expanding into foreign markets where the use of mobile Web browsing is growing rapidly. Which one of the following countries would this organization be least likely to look toward to include in their future expansion plans? a. Vietnam b. Kenya c. India d. Germany e. Nigeria ANSWER: d 67. The mangers of the Everline Corporation attribute their company’s continued profitability to the idea that globalization and information technology are closely related to one another. They acknowledge that the information technology revolution has occurred almost instantaneously. Which one of the following would not be considered a benefit derived from this so-called revolution? Societal hierarchies have grown in number to better accommodate information a. technology changes. b. A more free flow of capital across national boundaries has occurred. c. Operating costs have decreased for many businesses. d. The production of goods and services has become globalized. e. The costs of communication are reduced. ANSWER: a Scenario – The Renna Company Established in 1956, the Renna Company has always maintained its operations within the boundaries of the United States. Originally based in Lexington, Kentucky, this company has now expanded operations into thirteen other U.S. states. While it’s inexpensive and efficient cooling and heating products are in high demand even in foreign markets, this company contends it has no desire for international expansion. Conducting operations strictly within the U.S. borders does not appear to have limited this company overly much. It realized net profits of two billion dollars last year and provided gainful employment for over four thousand workers. The leaders of the Renna Company realize greater profits could be attained through international expansion. However, they stand in agreement when they state, “It is not always the money that best defines the worth of an organization.” The company desire to stay true to its mission statement, which claims, “It will serve the marketplace of the United States with its superior products and provide job opportunities with a fair wage for its employees.” The Renna Company is very proud of its products and enjoys the fact they are produced and sold in the United States of America. This company truly reflects the success possible when holding to the fact that “Made in America” is still a winner. Page 14 Name: Class: Date: Chapter 01: The Rise of Globalization 68. Which one of the following statements is least likely to be a rationale explaining why the Renna Company staunchly desires to avoid global expansion? a. Globalization can create a wearing away of old industries. b. Globalization brings into play the concept of sustainable development. c. Globalization can contribute to an increase in environmental degradation. Global expansion often leads to greater integration and interdependence among d. economies and societies, which can bring about injustices. Economic change comes with a high price tag including job losses and wages e. that become stagnant. ANSWER: b 69. All of the following are examples of counterarguments the Renna Company should consider before continuing with their stand of keeping their operations strictly within the borders of the United States except which one? Global expansion affords a strong potential for costs of both product production a. and product purchase to decrease. Life expectancy may increase for members of the population within the nations b. involved in globalization due to the increased quality of life. c. Globalization contributes to faster economic growth for the nations involved. The quality of life is most likely to improve for the citizens of the nations that are d. involved with globalization and trade. The wage levels of each nation may become stagnant and some workers may e. become displaced, having been replaced by less expensive foreign labor. ANSWER: e 70. The Renna Company has a clear understanding of the benefits of economic development. Economic development which meets the needs of the present generation without compromising the ability of future generations to meet their own needs, whether environmentally, socially or economically is best identified as which one of the following? a. Sustainable development b. Reform process c. Trade liberalization d. Corporate social responsibility e. Environmental degradation ANSWER: a Page 15 Name: Class: Date: Chapter 01: The Rise of Globalization With business becoming increasingly global, its success, fortunately, depends only on the domestic environment. Term Definition False Definition False Even though business is global, the credit crisis of 2008, started by an American investment bank, was limited to the American economy with fortunately no impact on the global economy. Term Definition True Key aspects of globalization include the elimination of barriers to trade and information technology. Term Definition False So far globalization has made it possible for goods, services, and capital, to cross national borders but not technology and culture. Term Definition The “soft” qualities essential to globalization include openness, protectionism, accountability, connectivity, democracy, and centralization. Term False Definition A sustainable decoupling process would eventually lead to a multi-polar world—a world economy in which the engines of growth could comprise the United States, the European Union, China, India, Brazil, Russia, and South Africa rather than the United States alone. Term True Definition False The openness and proliferation of globalization and free trade rules can best be attributed to the interwar period between World War I and II. Term As part of the World Bank’s Strategic Framework, there are five focus areas that accommodate and facilitate the globalization process including its analytical and advisory role supporting national policies to strengthen free market institutions and infrastructure that has provided the potential for creating large gains from trade. Definition True Page 16 Name: Class: Date: Chapter 01: The Rise of Globalization Term Definition False For World Trade Organization, increasing trade barriers has been one of the most simplistic ways to encourage trade and globalization. Term Definition True The foundations of the globalized business world are political—and so are the biggest threats to the system. Term Definition True Countries that have successfully adapted to globalization realize that they cannot succeed without high-quality government management at home. Term Definition True In communist and state-controlled economies like those in Central Asia property rights either do not exist or are not well defined which discourages domestic and foreign investors from making longterm commitments in these countries. Term Definition True More globalized economies like New Zealand and Singapore rank at the top in index for absence of corruption by Transparency International. Term Definition True Because broadband prices have been falling, governments in emerging economies such as India and South Africa are facilitating the spread of broadband to rural towns and villages to provide instant access to market information and government programs to remote villagers which will enable policymakers to maximize the economic potential of remote communities and make globalization sustainable. Term Definition False Critics argue that open trade and foreign direct investment always take jobs from workers in developing economies and transfer them to workers in advanced industrial countries which leave the workers in the developing country, out of work. Term A survey by the World Bank indicates that of the Definition False Page 17 Name: Class: Date: Chapter 01: The Rise of Globalization companies surveyed; unfortunately, only 30 percent have board-approved policies on environmental management indicating that corporate social responsibility practices have become an insignificant factor in determining where multinational corporations conduct business. Term Definition E Of the following, which is NOT true regarding the credit crisis? a. It affected farmers in Burkina Faso. b. It affected miners and steel workers in Ukraine. c. It affected assemble-line workers in Singapore. d. It affected white-collar workers at information technology firms in Ireland. e. It had an impact only on its country of origin- the United States. Term Definition D Brazilian Juice, a manufacturer of healthy fruit juices in Brazil, sells juice in six different countries including United States. Brazilian juice is engaging in a. economic development in United States. b. exercising nontariff barriers in Brazil. c. unfair trade practices. d. globalization. e. the World Trade Bank Group. Term Which of the following is NOT a key aspect of globalization? a. The elimination of barriers to trade b. Definition C Page 18 Name: Class: Date: Chapter 01: The Rise of Globalization Investment c. Financial independence d. Culture e. Information technology Term Definition E Countries that have been moving toward more open trade and free market policies are known as _____. a. African countries b. open-door economies c. industralized countries d. globalized economies e. emerging market economies Term Definition A India and Brazil have been moving towards more open trade and free market policies. These countries can be described as a. emerging market economies. b. open-door economies. c. industrialized countries. d. common market economies. e. the World Bank countries. Term Definition A sustainable decoupling process would eventually lead to _____. a. a multi-polar world b. globalization c. outsourcing A Page 19 Name: Class: Date: Chapter 01: The Rise of Globalization d. importing e. exporting Term Definition D A world economy in which the engines of growth could comprise the United States, the European Union, China, India, Brazil, Russia, and South Africa rather than the United States alone can be described as a(an) __________. a. interdependent world b. industrialized world c. globalized economy d. multi-polar world e. diverse world Term Definition According to the authors, which of the following is NOT true regarding globalization lessons for developing countries? a. Import oriented nations must switch to concentrate on domestication. b. Export oriented nations must diversify their market to include major emerging markets. c. Countries emphasizing exports should base their strategy on their true competitive advantage. d. For countries with large populations, the size of the domestic market remains most important. e. Overindulgence can lead to disaster. Term Which of the following is NOT a main purpose of the IMF? a. Provide a forum for cooperation on international monetary problems A Definition E Page 20 Name: Class: Date: Chapter 01: The Rise of Globalization b. Facilitate the sustainable growth of international trade c. Promote exchange rate stability d. Lend countries foreign exchange when needed e. Provide long-term low-interest social sector and infrastructure loans Term Definition What was the initial primary role of the World Bank? a. To aide in the reconstruction of Europe after World War II b. To help eradictate communicable diseases c. To try to avoid a repetition of the disastrous economic policies that had contributed to the Great Depression. d. To deal primarily with tariff negotiations e. To provide loans and take equity position in private companies Term The International Bank for Reconstruction and Development performs which of the following functions? a. Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing foreign aid funds provided by rich nation members b. Provide loans and take equity position in private companies of developing countries and works toward developing capital markets in theose economies c. Supports reconstruction and restructuring of member countries utilizing funds raised in international capital markets A Definition C Page 21 Name: Class: Date: Chapter 01: The Rise of Globalization d. Provides political risk coverage for private investments made in developing countries e. Works on issues related to foreign investment disputes Term Definition The Multilateral Investment Guarantee Agency performs which of the following functions? a. Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing foreign aid funds provided by rich nation members b. Provide loans and take equity position in private companies of developing countries and works toward developing capital markets in those economies c. Supports reconstruction and restructuring of member countries utilizing funds raised in international capital markets d. Provides political risk coverage for private investments made in developing countries e. Works on issues related to foreign investment disputes Term The International Center for the Settlement of Investment Disputes performs which of the following functions? a. Provides long-term low-interest social sector and infrastructure loans to the poorest members utilizing foreign aid funds provided by rich nation members b. Provide loans and take equity position in private companies of developing countries and works toward developing capital markets in those economies c. Supports reconstruction and restructuring of D Definition E Page 22 Name: Class: Date: Chapter 01: The Rise of Globalization member countries utilizing funds raised in international capital markets d. Provides political risk coverage for private investments made in developing countries e. Works on issues related to foreign investment disputes Term Definition D Trade expansion has been a leading factor in global integration, especially since the early _____. a. 1650s b. 1760s c. 1890s d. 1970s e. 2000s Term Definition A GATT refers to which of the following? a. General Agreement of Tariffs and Trade b. Great American Trade Tax c. Gift of American Treaty Tips d. General Articles on Tariffs and Trade e. Great Articles on Tariffs and Trade Term Which of the following is NOT an objective of the WTO? a. Reviewing national trade policies b. Acting as a form for trade negotiations c. Helping eradictate communicable diseases d. Definition C Page 23 Name: Class: Date: Chapter 01: The Rise of Globalization Settling trade disputes e. Administering trade agreements Term Definition B Trade without discrimination, freer trade, predictability, promotion of fair competition, and _____ are the five principles of the multilateral trading system. a. integrated capital markets b. encouragement of economic reform in developing countries c. liberalization of the trading system d. nontariff trade e. international Term Definition E The concept of curtailing agricultural subsidies in developed economies was incorporated into the ninth round to trade negotiations called the _____. a. “Dallas Round” b. “Toronoto Round” c. “Sparta Round” d. “Kabul Round” e. “Doha Round” Term The rules, enforcement mechanisms, and organizations that support market transactions are referred to as _____. a. industries b. companies c. businesses d. Definition E Page 24 Name: Class: Date: Chapter 01: The Rise of Globalization corporations e. institutions Term Definition C In Brazil, if there are government organizations that create strong incentives for private investment and operate under a system of checks and balances that function best in a democratic system of government, they could be classified as which of these? a. Transparent organizations b. Antitrust corporations c. Adaptive institutions d. Emerging markets e. Capital markets Term Definition In ABC country, a system of responsibility in which an authority, such as the government, is not answerable for its actions, it would be described as having the lack of _____. a. banking system b. integrity c. accountability d. transaction-based exporting e. trustworthiness Term The most recent device(s) that enables greatest ease in portability and accessibility of information is (are) the _____. a. magazines b. newspapers c. C Definition D Page 25 Name: Class: Date: Chapter 01: The Rise of Globalization Internet d. smart phones e. computer Term Definition D In India, several politicians are working very hard toward a system of full disclosure and openness that aims to avoid any semblance of corruption and cronyism. These efforts can be described as creating a system focused on _____. a. politics b. integrity c. accountability d. transparency e. democracy Term Definition D Which of the following is NOT true regarding property rights? a. Protection of property rights has always been fundamental to market economies. b. Studies have shown that countries that have successfully adapted to globalization guarantee property rights. c. Less globalized countries offer less property rigiht protection. d. In economies in Central Asia and parts of Africa and the Middle East, property rights are well defined. e. Countries without property rights will most likely fall behind nations that guarantee property rights. Term Illicit dealings undermine economic performance by doing all of the following EXCEPT: Definition A Page 26 Name: Class: Date: Chapter 01: The Rise of Globalization a. decreasing costs. b. raising competition. c. thwarting competition. d. reducing transparency. e. raising insecurity. Term Definition ABC Technology touts in their advertisements that their technology can transfer huge amount of data and other information in a second via the Internet. This describes ABC’s _____ in technology. a. brandwith b. digital server c. digital divide d. gigabytes e. Y2K Term A Definition C Which of the following is NOT true regarding the global use of information technology? a. Our globe relies on the Internet for business and social activity. b. Broadband prices have been falling. c. The IT revolution has been relatively slow. d. Internet-related technologies help reduce corporate and societal hierarchies. e. Internet and wireless technologies could make many authoritarian governments uneasy. Term The Definition describes the perceived economic gap C Page 27 Name: Class: Date: Chapter 01: The Rise of Globalization between countries or people with easy access to digital and information technology and those with very limited or no access. a. bandwith b. digital era c. digital divide d. gigabyte number e. Y2K gap Term Definition A Of the following, which is NOT true regarding the Internet and cell phone era? a. Fortunately, the next billion users will be the same as the first billion b. The majority of users will be from developing countries c. Text messaging will likely predominate emerging economies; mobile phone usage d. Countries are skipping the use of land-line technology and jumping to wireless systems e. Developing countries may “leapfrog” an entire generation of technology Term All of the following are arguments against globalization EXCEPT: a. it may lead to an increase in the apperance of old industries. b. it may lead to a loss of control over economic policies and developments. c. it may lead to an erosion of communities. d. it can be a force of exploitation and injustice. e. Definition A Page 28 Name: Class: Date: Chapter 01: The Rise of Globalization it can cause job losses and stagnant wages. Term Definition D The only way workers in industrialized countries can compete with their counterparts in the developing world will be through: a. increased use of the cost leadership strategy. b. increased diversity within the organization. c. increased empowerment of employees. d. increased productivity by using technologicallyintensive manufacturing technologies. e. increased flat organization structure. Term Definition McDonalds’ consumer products are made primarily of renewable materials; some of the material comes from recycled fiber. The restaurants also utilize LED light fixtures. McDonald’s is engaging in _____. a. future sourcing b. global warming c. next-generation consumer hook d. digital divide e. sustainable development Term Which of the following is NOT true regarding results from a survey by the World Bank on corporate social responsibility (CSR)? a. CSR practices are now a significant factor in determining where multinational companies conduct business. b. 90% of the companies surveyed have boardapproved policies on environmental management. c. E Definition C Page 29 Name: Class: Date: Chapter 01: The Rise of Globalization 90% of multinationals will make their decisions based on CSR issues with regard to foreign direct investment. d. CSR issues consistently implemented for the long term lead to sustainable business and development. e. CSR includes issues such as labor rights, corruption, human rights, community health, and land rights. Term Definition Successive waves of globalization include characteristics such as the expansion of trade, the diffusion of technology, extensive migration, and _____. a. improvements in country infrastructure b. increased employee morale c. improved healthcare d. financial independence e. cross-fertilization of diverse cultures Term Which of the following is NOT true regarding globalization? a. It guarantees that quality of life for all people will increase. b. It creates winners and losers. c. It has the potential to increase the quality of life for people. d. Some multinational companies will utilize globalization may try to pay substandard wages to the workers they employ in developing countries. e. Export barriers may need to be imposed by the WTO to help regulate the actions of multinational companies. E Definition A Page 30 Name: Class: Date: Chapter 01: The Rise of Globalization Term Definition B All of the following countries can be considered globalization “winners” EXCEPT: a. China b. Central Asia c. India d. Brazil e. South Africa Term Definition D Which of the following is NOT true regarding globalization’s “winners” and “losers?” a. Brazil has been flourishing due to gloablization. b. According to the World Bank, more than 400 million Chinese citizens have climbed out of poverty since the implementation of economic reform that started in their country. c. Those that suffer most from the effects of globalization are those countries that have not been able to seize the opportunities to participate in this process. d. Unfortunately, globalization only creates winners in industralized countries such as the United States. e. Efforts to hold back globalizaiton or technological progress are bound to fail. Term Definition The socio-economic reform process of eliminating trade, investment, cultural, information technology, and political barriers across countries, which in turn could lead to increased economic growth and geo-political integration and interdependence among nations of the world refers to . Term Countries that are implementing more open trade Globalization Definition Emerging Market Economics Page 31 Name: Class: Date: Chapter 01: The Rise of Globalization and free market policies are called . Term Definition Decoupling _______ refers to a fundamental global shift in which industrialized country-dependent developing economies begin to grow based on their own underlying economic strengths rather than the ups and downs of the world’s richest countries. Term Definition Multi-Polar World A world economy in which the engines of growth could comprise several major industrialized and emerging market economies such as the United States, the European Union, China, India, Brazil, Russia, and South Africa rather than the United States alone is called . Term Definition The international financial environment in which exchange rates and international payments for goods and services are conducted refers to . Term international monetary system Definition ________ are economic policy changes that promote private sector development, competitive markets, market-pricing, freer trade, and deregulation. Term Economic Reforms Definition _________ are government organizations that create strong incentives for private investment and operate under a system of checks and balances. Term Capital Markets Definition _______ refers to lowering and/or removing trade barriers such as tariffs, quotas, and subsidies. Term Liberalization of the trading system Definition institutions The rules, enforcement mechanisms, and organizations that support market transactions are called . Term ______ are government organizations that create strong incentives for private investment and operate under a system of checks and balances. Definition adaptive institutions Page 32 Name: Class: Date: Chapter 01: The Rise of Globalization Term Definition accountability A system of responsibility in which an authority, such as the government, is answerable for its actions refers to . Term Definition transparency ______ is a system of full disclosure and openness that aims to avoid any semblance of corruption and cronyism. Term Definition National laws aimed at maintaining competition in all sectors of the economy and preventing monopolistic behavior of firms are called . Term antitrust laws Definition Digital Era The period of transformation that adjusts lifestyles to make the Internet and wireless technologies a part of everyday life refers to the . Term Definition _______ refers to the amount of data and other information that can be transferred in a second via the Internet. Term Bandwidth Definition Digital Divide The perceived economic gap between countries or people with easy access to digital and information technology (and its benefits) and those with very limited access, or none at all refers to the . Term Definition Economic development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs, whether environmentally, socially or economically is called . Term Sustainable Development Definition True 2. In communist and state-controlled economies like those in Central Asia property rights either do not exist or are not well defined which discourages domestic and foreign investors from making long-term commitments in these countries. Term Definition Page 33 Name: Class: Date: Chapter 01: The Rise of Globalization False 3. A survey by the World Bank indicates that of the companies surveyed; unfortunately, only 30 percent have board-approved policies on environmental management indicating that corporate social responsibility practices have become an insignificant factor in determining where multinational corporations conduct business. Term Definition E 4. Of the following, which is NOT true regarding the credit crisis? a. It affected farmers in Burkina Faso. b. It affected miners and steel workers in Ukraine. c. It affected assemble-line workers in Singapore. d. It affected white-collar workers at information technology firms in Ireland. e. It had an impact only on its country of originthe United States. Term Definition B 13. All of the following countries can be considered globalization “winners” EXCEPT: a. China b. Central Asia c. India d. Brazil e. South Africa Term Definition True 12. Because broadband prices have been falling, governments in emerging economies such as India and South Africa are facilitating the spread of broadband to rural towns and villages to provide instant access to market information and government programs to remote villagers which will enable policymakers to maximize the economic potential of remote communities and make globalization sustainable. Term 11. The ability of a firm to adjust to a culture different from its own is referred to as . Definition Acculturation Page 34