Part 1B InternationalBusinessEnvironment-Reviewer

Part 1B InternationalBusinessEnvironment-Reviewer -...

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PART 1 B International Business Environment 94 Questions [1] Source: CMA 0676 1-34 Which of the following economic policies would not tend to correct a balance of payments deficit in the U.S.? A. Increase productivity in the manufacturing of U.S. exports. B. More effective use of monetary and fiscal policies to reduce inflation. C. A redistribution of economic aid and mutual defense burdens toward western European countries. D. Increase value of U.S. currency in relation to foreign currencies. [2] Source: CMA 0680 1-17 The value of the U.S. dollar in relation to other foreign currencies is A. Determined directly by the price of gold because the value of the U.S. dollar is tied to the price of gold. B. Set by the U.S. government in consultation with other foreign governments. C. Set along with the value of other currencies held by the International Monetary Fund. D. Determined by the forces of supply and demand on the foreign exchange markets. [3] Source: CMA 0680 1-20 When the U.S. dollar is expected to rise in value against foreign currencies, a U.S. company with foreign currency denominated receivables and payables should A. Slow down collections and speed up payments. B. Slow down collections and slow down payments. C. Speed up collections and speed up payments. D. Speed up collections and slow down payments. [4] Source: CMA 1281 1-12 If a country has only two factors of production, labor and capital, and it has a relative abundance of capital, the country will tend to A. Import capital-intensive goods and export labor-intensive goods. B. Refrain from trading owing to the abundance of capital. C. Export capital-intensive goods and import labor-intensive goods. D. Place an embargo on the export of capital-intensive goods. [5] Source: CMA 1281 1-16 In most recent years, the U.S. balance of payments has registered a deficit. This balance of payments deficit is a measure of the excess of A. Exports over imports. B. Imports over exports. C. Imports, private capital outflows, grants, and remittances over exports and private capital inflows. D. Goods imports over services imports. [6] Source: CMA 0682 1-12 Of the following transactions, the one that would result in a debit entry in the U.S. balance of payments account is the A. Receipt of dividends by an American corporation from its German subsidiary. B. Buying of IBM shares by a Kuwaiti investor. C. U.S. export of military equipment to Saudi Arabia. D. Expenditure of a U.S. resident vacationing in France. [7] Source: CMA 0682 1-13 Which one of the following transactions would result in a credit entry in the U.S. balance of payments account? A. A New York bank pays $5,000 in interest to foreigners. B. Volkswagen's U.S. subsidiary remits a dividend of $1 million to its parent company in Germany. C. A U.S. exporter buys marine insurance from a
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This note was uploaded on 01/15/2012 for the course ECONOMICS 101 taught by Professor John during the Spring '10 term at McMaster University.

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Part 1B InternationalBusinessEnvironment-Reviewer -...

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