Question Bank International Business Essay

Part 07 Outside Direct Investment Genuine/False Questions 1. (p. 242) A firm turns into a worldwide endeavor when it attempts remote direct venture. Valid 2. (p. 242) Licensing includes the foundation of another activity in an outside nation. Bogus 3. (p. 242) If a firm that makes bikes in Germany obtains a French bike maker, Greenfield venture has occurred. Bogus 4. (p. 242) The measure of FDI attempted over a given timespan is known as the progression of FDI. Valid 5. (p. 242) The complete aggregated estimation of outside claimed resources at a given time is the inflow of FDI. Bogus 6. (p. 242) FDI is seen by officials as a methods for going around future exchange boundaries. Valid 7. (p. 244) Historically, most FDI has been aimed at the created countries of the world as firms situated in cutting edge nations put resources into the others’ markets. Valid 8. (p. 246) The aggregate sum of capital put resources into processing plants, stores, places of business and such is alluded to as the load of FDI. Bogus 9. (p. 246) The biggest source nation for FDI has been China. Bogus 10. (p. 247) About 27 percent of the world’s biggest 100 nonfinancial multinationals in 2004 were American organizations. Valid 11. (p. 247) In creating nations, around 33% of FDI is as mergers and acquisitions. Valid 12. (p. 248) In 2004, around 66% of FDI stock was in administration ventures. Valid 13. (p. 249) When contrasted with sending out and authorizing, FDI is the more costly and hazardous. Valid 14. (p. 250) Internalization hypothesis is otherwise called the market blemishes approach. Valid 15. (p. 250) One of the issues of permitting is that it might bring about a firm’s parting with important innovative expertise to a potential remote contender. Valid 16. (p. 251) An oligopoly is an industry made out of a set number of huge firms. Valid 17. (p. 252) When at least two ventures experience each other in various territorial markets, national markets or enterprises provincial rivalry happens. Bogus 18. (p. 252) According to Vernon, area explicit focal points can help clarify the nature and heading of FDI. Bogus 19. (p. 253) Dunning, in the diverse worldview hypothesis, recommends that a firm should set up creation offices where outside resources or asset blessings important to the creation of the item exist. Valid 20. (p. 254) Pragmatic patriotism follows its underlying foundations to Marxist political and financial hypothesis. Bogus 21. (p. 254) Classical financial matters and the universal exchange speculations of Adam Smith and David Ricardo structure the reason for the free market see. Valid 22. (p. 255) The free market see contends that FDI is an advantage to both the source nation and to the host nation. Valid 23. (p. 255) Countries receiving a commonsense position seek after approaches intended to augment the national advantages and limit the national expenses. Valid 24. (p. 256) A part of even minded patriotism is the inclination to forcefully court FDI accepted to be in the national enthusiasm by, for instance, offering appropriations to outside MNEs as tax cuts or awards. Valid 25. (p. 257) Foreign direct speculation can make a positive commitment to a host economy by providing capital, innovation and the executives assets that would some way or another not be accessible and in this manner support that country’s monetary development rate. Valid 26. (p. 258) There is look into supporting the view that worldwide firms regularly move noteworthy innovation when they put resources into an outside nation. Valid 27. (p. 258) Jobs made in neighborhood providers because of the MNE’s speculation and occupations made due to expanded nearby spending by representatives of the MNE are instances of direct business impacts of FDI. Bogus 28. (p. 258) Host nation residents that are utilized by a MNE following a FDI are a case of a circuitous impact of FDI. Bogus 29. (p. 259) A country’s parity of installments accounts monitor the two its installments to and its receipts from different nations. Valid 30. (p. 259) A present record deficiency exists when a nation imports more than it sends out. Valid 31. (p. 259) as of late, the U.S. has run a persevering equalization of installments excess. Bogus 32. (p. 260) Host governments now and then concern that the auxiliaries of outside MNEs may have more prominent monetary force than indigenous contenders. Valid 33. (p. 261) FDI doesn't profit the host country’s equalization of installments if the outside auxiliary makes interest for home-nation fares of capital gear, middle of the road merchandise or integral items. Bogus 34. (p. 262) The term seaward creation alludes to FDI embraced to serve the home market. Valid 35. (p. 263) Countries can't restrict national firms from putting resources into specific nations for political reasons. Bogus 36. (p. 264) The two most basic techniques for limiting internal FDI are proprietorship restrictions and execution necessities. Valid 37. (p. 265) The WTO has been extremely fruitful in endeavors to start talks planned for building up an all inclusive arrangement of rules intended to advance the progression of FDI. Bogus 38. (p. 266) Licensing is a decent alternative for firms in innovative ventures where ensuring firm-explicit ability is of vital significance. Bogus 39. (p. 266-267) Typically authorizing will be a typical technique in oligopolies where serious relationship necessitates that worldwide firms keep up close command over outside activities with the goal that they can dispatch composed assaults against their worldwide rivals. Bogus 40. (p. 267) Licensing is progressively basic in divided, low-tech ventures in which comprehensively scattered assembling isn't an alternative. Valid Different Choice Questions 41. (p. 242) FDI happens when a A. Local firm imports items and administrations from another nation B. Firm ships its item starting with one nation then onto the next C. Firm puts resources into the load of another organization D. Firm puts legitimately in offices to deliver as well as market an item in an outside nation 42. (p. 242) A Greenfield venture A. Is a type of FDI that includes the foundation of another activity in an outside nation B. Includes a 7 percent stock in a gained outside business element C. Includes a merger with an outside business D. Happens when a firm gains another organization in an outside countr 43. (p. 242) If General Electric, a U.S. based enterprise, bought a half enthusiasm for an organization in Italy, that buy would be a case of a(n) A. Minority obtaining B. By and large stake C. Larger part securing D. Greenfield venture 44. (p. 242) The measure of FDI attempted over a given timespan is A. The progression of FDI B. The supply of FDI C. The FDI surge D. The FDI inflow 45. (p. 242) The supply of FDI is A. The measure of FDI attempted over a given timeframe B. The complete aggregated estimation of remote claimed resources at a given time C. The progression of FDI out of a nation D. The progression of FDI into a nation 46. (p. 242) FDI has been ascending for the entirety of the accompanying reasons, with the exception of A. The globalization of the world economy B. The general increment in exchange obstructions in the course of recent years C. Firms are attempting to go around exchange boundaries D. There is a move toward popularity based political organizations and free market economies 47. (p. 244) Historically, most FDI has been aimed at the _____ countries of the world as firms situated in cutting edge nations put resources into A. Immature, immature nations B. Created, immature nations C. Grown, each other’s markets D. Immature, each other’s markets 48. (p. 244) The U.S. has been an alluring objective for FDI in view of the entirety of the accompanying reasons, aside from A. Its little and well off local markets B. Its dynamic and stable economy C. Its positive world of politics D. Its receptiveness to FDI 49. (p. 244) Identify the inaccurate proclamation in regards to the course of FDI. A. Verifiably, most FDI has been aimed at the creating countries of the world B. During the 1980s and 1990s, the United States was frequently the most loved objective for FDI inflows C. The created countries of the EU have gotten critical FDI inflows D. Ongoing inflows into creating countries have been focused at the developing economies of South, East and Southeast Asia 50. (p. 246) Africa is certainly not a well known goal for FDI as a result of the entirety of the accompanying reasons, with the exception of A. Political turmoil in the district B. Furnished clash in the area C. Advancement of FDI guidelines D. Visit arrangement changes in the area 51. (p. 246) The aggregate sum of capital put resources into production lines, stores, places of business and such is summed up by A. Net fixed capital arrangement B. Complete venture capital C. Complete unmistakable venture D. Net depreciable ventures 52. (p. 246) The biggest source nation for FDI since World War II has been A. Japan B. China C. The United States D. The United Kingdom 53. (p. 247) Most cross-outskirt venture is A. As Greenfield ventures B. Made through mergers and acquisitions C. Among American and Japanese organizations D. Associated with building new offices 54. (p. 247) Which of coming up next isn't a motivation behind why firms want to obtain existing resources as opposed to attempt green-field speculations? A. Outside firms are procured on the grounds that those organizations have important key resources B. Firms make acquisitions since they accept they can build the productivity of the procured unit by moving capital, innovation or the executives aptitudes C. Despite the fact that Greenfield ventures are similarly less unsafe for a firm acquisitions consistently return higher benefits D. Mergers and acquisitions are speedier to execute than green-field ventures 55. (p. 247) In creating countries most FDI inflows are as A. Mergers B. Greenfield ventures C. Acquisitions D. Non-benefit associations 56. (p. 248) The part structure of FDI shows that by 2004 around _____ of FDI stock was in administration indus