Business Finance

transnational Business Finance, 12e (Eiteman, et al) Chapter 1 globalization and the multinational Enterprise 1. 1 globalization and Creating take to be in the transnational Enterprise Multiple Choice 1) Which of the followers be critical to a strong trying to reach the spinning top of the soaked value profit? A) An open grocery place. B) broad(prenominal) quality strategic management. C) Access to capital. D) whole of the in a higher place serve well A Diff 2 division 1. 1 globalisation and Creating Value in the transnational Enterprise learning conceptual 2) A well-established, large U.S. -based MNE leave belike non be able to thrash which of the following obstacles to maximizing firm value? A) An open market place. B) High quality strategic management. C) Access to capital. D) none of the to a higher place function D Diff 2 return 1. 1 globalisation and Creating Value in the Multinational Enterprise dexterity credit rating 3) A well-established, large Ch ina-based MNE will probably be most adversely affected by which of the following elements of firm value? A) An open marketplace. B) High-quality strategic management. C) Access to capital.D) Access to subject press pool. effect A Diff 2 thing 1. 1 globalisation and Creating Value in the Multinational Enterprise attainment conceptual 4) A well-established, large, Brazil-based MNE will probably be most adversely affected by which of the following elements of firm value? A) An open marketplace. B) High-quality strategic management. C) Access to capital. D) Access to qualified labor pool. fare C Diff 2 event 1. 1 Globalization and Creating Value in the Multinational Enterprise attainment Conceptual avowedly/False ) Three necessary conditions for a firm to reach the top of the firm value pyramid argon an open market place, blue quality strategic management, and access to capital. Answer unbent Diff 1 Topic 1. 1 Globalization and Creating Value in the Multinational Enterprise acquisition Conceptual 2) comparative advantage is one of the underlying principles driving the ripening of global business. Answer TRUE Diff 1 Topic 1. 1 Globalization and Creating Value in the Multinational Enterprise learning experience show 1) List and explain three strategic motives why firms compose multinationals and clear an example of each.Answer The authors provide 5 strategic motives for firms to become multinationals market seekers, stark materials seekers, output efficiency seekers, knowledge seekers, and political safety seekers. securities industry seekers argon looking for more consumers for their products such as automobiles or steel. Knowledge seekers whitethorn be looking for an educated work force similar to the behavior firms seeking R and D set up shop in university towns. Raw materials seekers may be after commodities such as embrocate or copper. Production efficiencies may occur in countries like Mexico that stimulate capable workers and lower wages.Political safety seekers atomic number 18 looking for countries that will non expropriate their assets, so they may stay away from countries that in the target have engaged in such activities. Diff 3 Topic 1. 1 Globalization and Creating Value in the Multinational Enterprise science Conceptual 1. 2 The Theory of Comparative wages Multiple Choice 1) The system that suggests specialization by country can increase worldwide production is ________. A) the theory of comparative degree degree advantage B) the theory of unusual direct enthronization C) the planetaryistic Fisher effect D) the theory of working capital managementAnswer A Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill perception 2) Which of the following is NOT a reason governments interfere with comparative advantage? A) Governments attempt to achieve full employment. B) Governments promote economic development. C) matter self-sufficiency in defense-related industries. D) every last(predicate) atomic number 18 reasons governments interfere with comparative advantage. Answer D Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill course credit 3) Which of the following factors of production DO NOT advert freely between countries? A) Raw materialsB) Financial capital C) (Non-military) Technology D) All of the above factors of production flow freely among countries. Answer A Diff 1 Topic 1. 2 The Theory of Comparative Advantage Skill credit entry 4) Which of the following would NOT be a way to implement comparative advantage? A) IBM exports computers to Egypt. B) Computer hardw be is designed in the United States provided manufactured and assembled in Korea. C) Water of the greatest purity is obtained from wells in Oregon, bottled, and exported worldwide. D) All of the above are examples of ways to implement comparative advantage.Answer D Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill Conceptual 5) Of the following, which would NOT be considered a wa y that government interferes with comparative advantage? A) Tariffs. B) Managerial skills. C) Quotas. D) Other non-tariff restrictions. Answer B Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill science confessedly/False 1) The theory of comparative advantage owes it origins to Ben Bernanke as described in his book The Wealth of Bankers. Answer stupid Diff 1 Topic 1. 2 The Theory of Comparative Advantage Skill acquaintance ) International foxiness might have approached the comparative advantage model in the nineteenth century, and it does so even more today. Answer paradoxical Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill Conceptual 3) Comparative advantage shifts over time as less developed countries become more developed and realize their latent opportunities. Answer TRUE Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill science 4) Comparative advantage in the 21st century is based more on services and their cross border facilitation by tel ecommunications and the Internet.Answer TRUE Diff 1 Topic 1. 2 The Theory of Comparative Advantage Skill Recognition 5) Comparative advantage was once the cornerstone of international trade theory, only when today it is archaic, simplistic, and irrelevant for explaining investing choices made by MNEs. Answer FALSE Diff 2 Topic 1. 2 The Theory of Comparative Advantage Skill Recognition 1. 3 What Is Different about Global Financial heed? Multiple Choice 1) Which of the following domesticated fiscal instruments have NOT been modified for use in international financial management? A) coin options and futures.B) Interest rate and currency swaps. C) Letters of credit. D) All of the above are domestic financial instruments that have also been modified for use in international financial markets. Answer D Diff 2 Topic 1. 3 What Is Different about Global Financial Management? Skill Recognition True/False 1) MNEs must modify finance theories like represent of capital and capital budgetin g because of opposed complexities. Answer TRUE Diff 2 Topic 1. 3 What Is Different about Global Financial Management? Skill Recognition 1. 4 Market Imperfections A rationale for the population of the Multinational FirmMultiple Choice 1) In determining why a firm becomes multinational there are many reasons. One reason is that the firm is a market seeker. Which of the following is NOT a reason why market seeking firms produce in foreign countries? A) Satisfaction of local bespeak in the foreign country. B) Satisfaction of local demand in the domestic markets. C) Political safely and sm wholly likelihood of government expropriation of assets. D) All of the above are market-seeking activities. Answer C Diff 2 Topic 1. 4 Market Imperfections A Rationale for the Existence of the Multinational Firm Skill Recognition ) ________ investments are designed to promote and enhance the growth and profitability of the firm. ________ investments are designed to deny those same opportunities to t he firms competitors. A) Conservative Aggressive B) Defensive proactive C) Proactive Defensive D) Aggressive Proactive Answer C Diff 2 Topic 1. 4 Market Imperfections A Rationale for the Existence of the Multinational Firm Skill Recognition True/False 1) For firms competing in a world characterized by oligopolistic competition, strategic motives can be subdivided into proactive and justificative investments. Answer TRUEDiff 1 Topic 1. 4 Market Imperfections A Rationale for the Existence of the Multinational Firm Skill Recognition 2) Defensive measures are designed to enhance growth and profitability of the firm itself. Answer FALSE Diff 1 Topic 1. 4 Market Imperfections A Rationale for the Existence of the Multinational Firm Skill Recognition 1. 5 The Globalization work out Multiple Choice 1) The phase of the globalization process characterized by imports from foreign suppliers and exports to foreign buyers is called the A) domestic phase. B) multinational phase. C) international trade phase.D) import-export banking phase. Answer C Diff 2 Topic 1. 5 The Globalization bear on Skill Recognition 2) The authors describe the multinational phase of globalization for a firm as one characterized by the A) ownership of assets and enterprises in foreign countries. B) potential for international competitors or suppliers even though all accounts are with domestic firms and are denominated in dollars. C) imports from foreign suppliers and exports to foreign buyers. D) requirement that all employees be multilingual. Answer A Diff 2 Topic 1. 5 The Globalization Process Skill Recognition ) A firm in the International Trade arrange of Globalization A) makes all foreign fees in foreign currency units and all foreign receipts in domestic currency units. B) receives all foreign receipts in foreign currency units and makes all foreign payments in domestic currency units. C) bears direct foreign exchange risk. D) none of the above Answer C Diff 2 Topic 1. 5 The Globalization P rocess Skill Conceptual 4) Of the following, which was NOT mentioned by the authors as an increase in the demands of financial management services due to increased globalization by the firm?A) Evaluation of the credit quality of foreign buyers and sellers. B) Foreign consumer rule of payment preferences. C) Credit risk management. D) Evaluation of foreign exchange risk. Answer B Diff 2 Topic 1. 5 The Globalization Process Skill Recognition 5) Of the following, which was NOT mentioned by the authors as an increase in the demands of financial management services due to increased globalization by the firm? A) Evaluation of the credit quality of foreign buyers and sellers. B) Foreign consumer method of payment preferences. C) Credit risk management.D) Evaluation of foreign exchange risk. Answer B Diff 2 Topic 1. 5 The Globalization Process Skill Recognition 6) The authors describe the multinational phase of globalization for a firm as one characterized by the A) ownership of assets and enterprises in foreign countries. B) potential for international competitors or suppliers even though all accounts are with domestic firms and are denominated in dollars. C) imports from foreign suppliers and exports to foreign buyers. D) requirement that all employees be multilingual. Answer A Diff 2 Topic 1. 5 The Globalization ProcessSkill Recognition 7) The vis-a-vis agency problems limiting financial globalization are caused by these ii groups acting in their own self-interests rather than the interests of the firm. A) Rulers of sovereign states and unsavory impost officials. B) Corporate insiders and attorneys. C) Corporate insiders and rulers of sovereign states. D) Attorneys and unsavory customs officials. Answer C Diff 2 Topic 1. 5 The Globalization Process Skill Recognition True/False 1) Typically, a firm in its domestic introduce of globalization has all financial transactions in its domestic currency.Answer TRUE Diff 1 Topic 1. 5 The Globalization Process Skill Conc eptual 2) Typically, a greenfield investment abroad is considered a greater foreign investment having a greater foreign presence than a joint gage with a foreign firm. Answer TRUE Diff 1 Topic 1. 5 The Globalization Process Skill Recognition 3) The authors argue that financial inefficiency caused by influential insiders may prove to be an increasingly troublesome bar to international finance. Answer TRUE Diff 2 Topic 1. 5 The Globalization Process Skill Conceptual