IB Business And Management Business Organisation & Environment: 1.9

50 Questions

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Business Organisation Quizzes & Trivia

Questions and Answers
  • 1. 
    The sales revenue of large multinational corporations often exceeds the GDP of many countries
    • A. 

      True

    • B. 

      False

  • 2. 
    Globalisation can be defined as an increase in international trade across the world
    • A. 

      True

    • B. 

      False

  • 3. 
    Multinational companies are public limited companies that operate overseas
    • A. 

      True

    • B. 

      False

  • 4. 
    Cultural exports have lead to increased globalisation
    • A. 

      True

    • B. 

      False

  • 5. 
    A regional trading bloc allows member countries from all over the world to unite to remove barriers to international trade
    • A. 

      True

    • B. 

      False

  • 6. 
    Trade liberalisation has been a key driver of globalisation
    • A. 

      True

    • B. 

      False

  • 7. 
    Quotas are a form of international protectionism
    • A. 

      True

    • B. 

      False

  • 8. 
    Multinationals can minimise their tax bills by operating in overseas countries
    • A. 

      True

    • B. 

      False

  • 9. 
    NAFTA is an example of a free trade area
    • A. 

      True

    • B. 

      False

  • 10. 
    NAFTA is an example of a common market
    • A. 

      True

    • B. 

      False

  • 11. 
    The euro-zone is an example of a free trade area
    • A. 

      True

    • B. 

      False

  • 12. 
    The euro-zone is an example of an economic and monetary union 
    • A. 

      True

    • B. 

      False

  • 13. 
    Mercosur is an example of a common market
    • A. 

      True

    • B. 

      False

  • 14. 
    Mercosur is an example of a customs union
    • A. 

      True

    • B. 

      False

  • 15. 
    The EU is an example of a common market
    • A. 

      True

    • B. 

      False

  • 16. 
    The EU is an example of an economic and monetary union
    • A. 

      True

    • B. 

      False

  • 17. 
    A free trade area  is when a group of countries have removed tariffs and quotas between themselves, while retaining the right to set tariffs/quotas towards non-members
    • A. 

      True

    • B. 

      False

  • 18. 
    A common market is when a group of countries have removed tariffs and quotas between themselves, while retaining the right to set tariffs/quotas towards non-members
    • A. 

      True

    • B. 

      False

  • 19. 
    A customs union has all the benefits of a free trade area AND countries adopt a common set of trade restrictions with non-members
    • A. 

      True

    • B. 

      False

  • 20. 
    A common market has all the benefits of a free trade area AND countries adopt a common set of trade restrictions with non-members
    • A. 

      True

    • B. 

      False

  • 21. 
    In a common market, members do away with duties and other trade barriers. They allow companies to invest freely in each member's country.
    • A. 

      True

    • B. 

      False

  • 22. 
    In a free trade area, members do away with duties and other trade barriers. They allow companies to invest freely in each member's country.
    • A. 

      True

    • B. 

      False

  • 23. 
    Economic and monetary unions are an attempt to create the economic conditions that exist in just one country for all members; e.g. a common currency, a single interest rate and agreement on fiscal policy.
    • A. 

      True

    • B. 

      False

  • 24. 
    Cutoms unions are an attempt to create the economic conditions that exist in just one country for all members; e.g. a common currency, a single interest rate and agreement on fiscal policy.
    • A. 

      True

    • B. 

      False

  • 25. 
    Firms that establish themselves overseas before any other competitor is able to do so are likely to enjoy the exclusive benefit of
    • A. 

      Economies of scope

    • B. 

      Economies of scale

    • C. 

      First mover advantage

    • D. 

      Brand loyalty

  • 26. 
    Members of a fre trade area agree to remove all the following except
    • A. 

      Tariffs

    • B. 

      Quotas

    • C. 

      Taxes

    • D. 

      Export restraints

  • 27. 
    Potential problems of overseas expansion do not include
    • A. 

      Lack of local knowledge

    • B. 

      Higher distribution costs

    • C. 

      Language and cultural barriers

    • D. 

      Lower tax liabilities

  • 28. 
    An advantage of not joining a trading bloc is the opportunity to
    • A. 

      Exploit new market opportunities

    • B. 

      Lower costs by operating in overseas markets

    • C. 

      Enjoy economic independence

    • D. 

      Spread risks

  • 29. 
    Which of the following is drawback to a multinational expanding overseas?
    • A. 

      The spreading of risks by not relying on any one economy

    • B. 

      Opportunities for economies of scale

    • C. 

      Different business etiquette and customs

    • D. 

      Wage rates in less developed countries

  • 30. 
    Which of the following reasons does not explain why multinationals are better than domestic rivals in the provision of goods and services?
    • A. 

      Well-known brand names

    • B. 

      Economies of scale in production, distribution and marketing

    • C. 

      Better knowledge of local cultures

    • D. 

      The economic power to influence or encourage national governments

  • 31. 
    Costs of globalisation to a business do not include
    • A. 

      Increased rivalry in the market place

    • B. 

      Larger budget devoted to research and development

    • C. 

      Relocation costs

    • D. 

      Increasing returns to scale

  • 32. 
    Which of the following is not a potential problem for Chinese firm Lau & Chen Manufacturers expanding to the USA?
    • A. 

      Differences in culture and language

    • B. 

      Administration procedures and costs

    • C. 

      Lack of infrastructure networks

    • D. 

      Potential conflict and restrictions

  • 33. 
    Globalisation presents many opportunities for businesses. Which one of the options below is the most likley exception to this rule?
    • A. 

      Mergers, acquisitions and joint ventures

    • B. 

      Economies of scale

    • C. 

      Larger customer base

    • D. 

      Language translation

  • 34. 
    A free trade ___________ requires state members to remove trade _________ with each other
    • A. 

      Area, barriers

    • B. 

      Agreement, barriers

    • C. 

      Area, conflict

    • D. 

      Agreement, conflict

  • 35. 
    Which of the following is a disadvantage of joining a regional trading bloc?
    • A. 

      Removal of barriers to trade

    • B. 

      Promotes international trade of goods and services

    • C. 

      Trade diversion

    • D. 

      Trade creation

  • 36. 
    Reasons for a business developing overseas include
    • A. 

      Incurring more risks

    • B. 

      Favourable trading conditions in the domestic economy

    • C. 

      Cheaper access to factors of production

    • D. 

      Relocation costs

  • 37. 
    Which of the following is not a drawback of joining a regional tradding bloc?
    • A. 

      Unemployment could be created as domestic firms face increased competition

    • B. 

      Trade diversion is created

    • C. 

      Trade creation takes place

    • D. 

      Policies taken by the RTB might not suit all member states

  • 38. 
    A valid argument for multinational firms to spend money on foreign direct investment is that
    • A. 

      Businesses will make more money by operating overseas

    • B. 

      It is a form of altruism

    • C. 

      It can avoid trade restrictions

    • D. 

      They benefit from economies of scope

  • 39. 
    All the statements below are valid arguments for limiting free international trade except
    • A. 

      Opportunities for specialisation

    • B. 

      The protection of infant industries from international rivals

    • C. 

      Political and strategic reasons

    • D. 

      Protect domestic employment

  • 40. 
    Which of the following is least likely to be a barrier to international trading?
    • A. 

      International business etiquette

    • B. 

      Political and economic conflict

    • C. 

      Cultural differences

    • D. 

      Communication across geographical locations

  • 41. 
    Memeber countries of a trade agreement that agree to establish a common external tariff to non-member states are collectively known as a
    • A. 

      Customs union

    • B. 

      Economic trading bloc

    • C. 

      Partnership agreement

    • D. 

      Free trade area

  • 42. 
    The concept of adjusting global marketing techniques to better suit the varying needs of overseas customers is known as
    • A. 

      Direct marketing

    • B. 

      Global localisation (glocalisation)

    • C. 

      International marketing

    • D. 

      Technology transfer

  • 43. 
    Barriers to globalisation in developing countries do not include
    • A. 

      Infrastructure

    • B. 

      Distribution networks

    • C. 

      Legal restrictions

    • D. 

      Large populations

  • 44. 
    Benefits of globalisation to a business include
    • A. 

      Economies of scale

    • B. 

      Rivalry

    • C. 

      Price transparency

    • D. 

      Increased market choice

  • 45. 
    ___________ is the growing trend towards worldwide markets in products, capital and labour, unrestricted by barriers
  • 46. 
    _______ international trade, is international trade that is allowed to take place without restrictions such as 'protectionist' tariffs and quotas
  • 47. 
    _______: A tax imposed on an imported product
  • 48. 
    _______:  A physical limit placed on the imports of certain products
  • 49. 
    NAFTA is an example of a ______________
  • 50. 
    Mercosur (Argentina, Brazil, Paraguay, Uruguay and Venezuela) is an example of a _____________