Division of Applied Undergraduate StudiesInternational Trade Investment: LRMS1-UC 583Spring, 2024Midterm ExamDUE DATE: Sunday, March 31, 2024 End of Day: SUBMIT in Brightspace-“Assignments” to InstructorPart I (30 Points)Circle or use an X or Color to show the letter of the best response below1. Globalization can be defined as:a) A strategy of developing unique products for each nation in the worldb) Increasing environmental changes across the globec) Increased use of global communication systemsd) Increased integration of markets and dispersed production across national boundaries2. Identify the source of globalization from one the following:a) The advances and growth of telecommunication useb) Falling transportation costsc) Reduction in trade and FDI barriersd) All of the above3. The WTO was established to promote, among other things, this: a) Trade in services and protection of intellectual property rights b) Commitment to increase trade-related pollution standards by member countries c) Elimination of tariffs on all agricultural products d) None of the above4. FDI stands for:a) Foreign development initiatives of the World Bankb) Various investment policies of the Department of Commercec) A foreign company's business ownership in another countryd) A specific type of international business negotiation strategy5. Government interference in the operations of a multinational firm is a form. of:a) Translation riskb) Political Riskc) Sales development riskd) None of the above6. All the following is true about culture EXCEPT:a) Culture is the shared belief, norms and values that guide everyday life of a groupb) Culture is passed from generation to generation through norms, values and beliefsc) Culture is defined effectively only in terms of religion and language which affect societiesd) Culture is part of tradition in societies 7. If managers believe that their home cultural norms are universal, this belief may lead to:a) Increased gains in a firm’s competitive advantage in global businessb) Lower business opportunities for a firm in different marketsc) Increased product acceptance in new marketsd) Lower incidents of rejection of the company’s products8. Research on culture suggests that:a) Societies differ only in terms of religion, language and ethnicityb) Similarities exists among societies on several dimensions of culturec) Closely related cultures always avoid trade conflictsd) None of the above9. On which of the following Hofstede's cultural dimensions does the U.S rank near the top of countries surveyed?a) Masculinityb) Individualismc) Global hegemonyd) Power distance10. The main idea behind neo-mercantilism is that a country is better off if it maintains a trade: a) Equilibrium with trading partners b) Embargo against those imposing tariffs on imports c) Surplus with trading partners d) Deficit in the capital account of the balance of payments11. The economic argument for government intervention in the free flow of trade is based on the possibility that some firms can create:a) National oligopolies in trade and must be assisted by governmentb) New sources of comparative advantages for the country and must be assisted by governmentc) Demand that must be balanced by supply of imported productsd) All of the above12. If a country possesses a lot of technological resources, trade theory suggests that the country is more likely to:a) Export products that require low-wage, semi-skilled laborb) Market its products domestidai 写International Trade & Investment: LRMS1-UC 583 Spring, 2024 Midterm ExamMatlab cally using local content strategies to secure its advantagec) Export large amounts of products or services with low-skilled inputs it does not needd) None of the above13. This theory suggests that trade leads to a situation where all trading countries win:a) Total advantageb) Mercantilismc) Comparative advantaged) International product life cycle14. Political systems across countries can be described in terms of two related dimensions: The degree to which they emphasize i) collectivism versus individualism and ii) the degree to which they are:a) Democratic versus absolute power in a party or groupb) Market-oriented versus production-orientedc) Developing versus industrializedd) Christian versus animist religions15. Governments all over the world attempt to restrict FDI because:a) That is the surest way to increase economic growthb) They stand to gain from absolute and comparative advantages in most industriesc) They look out for the interests of their countries and the interests of political leadersd) None of the abovePart II (30 Points)Respond to the following questions: Type in your responses in the appropriate space as necessary. Be as concise as possible. (Limit your responses to what is required using descriptive phrases that adequately present your thinking) ------------------------------------------------------------------------------------------------------------------1. Current debates on globalization can cause a lot of passion and other emotional responses. State two reasons why there is such controversy around globalizationi)ii)2. If a country such as Philippines scores much higher than the United States on Uncertainty Avoidance (UA), one of Hofstede’s cultural dimensions, briefly, show how this information can help a manager who plans to operate in both countries?State one area of management where differences in Individualism (IND) would be a relevant factor in decision- making as presented below:- How would differences in UA affect one area of management of an organization in Philippines and US (You may make any assumption(s) and use an example(s)- How would differences in individualism (IND) affect one area of management of an organization in Philippines and US (As above, you may make any assumption(s) and use an example(s) to illustrate your response.3. Identify and describe briefly two host-country sources of political risk a firm would face as it expands abroadi)ii)4. Describe two specific types of political risk a firm in a specific industry would face in any one of today’s emerging markets you are familiar with or have some knowledge of. Select a specific example of an emerging market (You may make an assumption to help you in answering this question).i) ii)5. Show how Heckscher-Ohlin’s theory can be used to explain trade between any two countries of your choice.6. What does the New Trade theory of international trade attempt to explain? Give one example of the theory’s explanation of trade.Example:7. Why is a subsidy a form. of government intervention in trade?8. What is a customs union in regional economic integration? Give one example of an existing customs union.Customs Union:Example:9. Give one reason why a firm would prefer to expand into new national markets through an FDI rather than through trade?10. Give one reason why a firm would prefer a free trade area to an economic union?========================================================================== Part III (40 points)Be concise but complete in your responses to the following. Attempt FOUR (4) questions below, including the sub-questions. Select ONE question from each alternate (i.e. WX：codehelp
