Question 1 Multiple Choice 0 of 1 point(s) The most common performance requirements that are intended to restrict inward FDI are related to local content, exports, local participation in top management, and: Your Answer: expatriation of earnings Correct Answer: technology transfer Feedback: Difficulty: MediumPage: 256 Question 2 Multiple Choice 1 of 1 point(s) It is increasingly common for governments to: Your Answer: offer incentives to firms that invest in their countries Correct Answer: offer incentives to firms that invest in their countries Feedback: Difficulty: MediumPage: 255 Question 3 True/False 0 of 1 point(s) Performance requirements are controls over the behavior of the MNE's local subsidiary. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 256 Question 4 True/False 1 of 1 point(s) The free market view argues that international production should be distributed among countries according to the theory of comparative advantage. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 241 Question 5 Multiple Choice 0 of 1 point(s) Until the collapse of communism between 1989 and 1991, the countries of Eastern Europe were: Your Answer: ambivalent about FDI Correct Answer: opposed to FDI Feedback: Difficulty: MediumPage: 241 Question 6 Multiple Choice 0 of 1 point(s) The radical ideology of FDI has the following characteristics: Your Answer: views FDI as having both benefits and costs; classical economic roots Correct Answer: Marxist roots; views the MNE as an instrument of imperialist domination Feedback: Difficulty: MediumPage: 244 Question 7 True/False 0 of 1 point(s) The four main benefits of FDI for a host country include the resource-transfer effect, the employment effect, the balance-of payments effect, and the effect on competition and economic growth. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 244 Question 8 Multiple Choice 0 of 1 point(s) The only way in which a current account deficit can be supported in the long run is by: Your Answer: selling off assets to local companies. Correct Answer: selling off assets to foreigners. Feedback: Difficulty: MediumPage: 249 Question 9 Multiple Choice 0 of 1 point(s) Countries have been known to occasionally manipulate _______ to try to encourage their firms to invest at home. Your Answer: environmental rules Correct Answer: tax rules Feedback: Difficulty: MediumPage: 255 Question 10 Multiple Choice 0 of 1 point(s) The beneficial effects of FDI may be reduced if most management positions and highly skilled jobs in the subsidiaries of foreign firms are reserved for _______ nationals. Your Answer: host-country Correct Answer: home-country Feedback: Difficulty: MediumPage: 246 Question 1 Multiple Choice 1 of 1 point(s) Many investor nations now have government backed insurance programs to cover major types of foreign investment risk. The types of risks insurable through these programs include all of the following except: Your Answer: strategic business blunders Correct Answer: strategic business blunders Feedback: Difficulty: MediumPage: 254 Question 2 Multiple Choice 1 of 1 point(s) The only way in which a current account deficit can be supported in the long run is by: Your Answer: selling off assets to foreigners. Correct Answer: selling off assets to foreigners. Feedback: Difficulty: MediumPage: 249 Question 3 True/False 0 of 1 point(s) According to the pragmatic nationalist view, FDI should only be undertaken if the benefits outweigh the costs. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 242 Question 4 True/False 1 of 1 point(s) Foreign management skills acquired through FDI may produce important benefits for the host country. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 246 Question 5 True/False 1 of 1 point(s) Virtually all investor countries, including the U.S., have exercised some control over outward FDI from time to time. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 6 Multiple Choice 1 of 1 point(s) Until the collapse of communism between 1989 and 1991, the countries of Eastern Europe were: Your Answer: opposed to FDI Correct Answer: opposed to FDI Feedback: Difficulty: MediumPage: 241 Question 7 Multiple Choice 0 of 1 point(s) Countries have been known to occasionally manipulate _______ to try to encourage their firms to invest at home. Your Answer: environmental rules Correct Answer: tax rules Feedback: Difficulty: MediumPage: 255 Question 8 Multiple Choice 0 of 1 point(s) The Japanese government has insisted in the past that technology be transferred to Japan through __________, rather than FDI. Your Answer: diplomatic channels Correct Answer: licensing Feedback: Difficulty: MediumPage: 245 Question 9 True/False 0 of 1 point(s) The four main benefits of FDI for a host country include the resource-transfer effect, the employment effect, the balance-of payments effect, and the effect on competition and economic growth. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 244 Question 10 Multiple Choice 0 of 1 point(s) Which of the following is not one of the reasons that by the end of the 1980s, the radical position was in retreat almost everywhere in the world? Your Answer: The collapse of communism in Eastern Europe Correct Answer: Lobbying efforts on the part of the United Nations in favor of FDI Feedback: Difficulty: MediumPage: 241 Question 1 True/False 0 of 1 point(s) Flexible interest rates and loans are the most common incentives governments offer to get foreign firms to invest in their countries. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 255 Question 2 True/False 1 of 1 point(s) From 1945 until the 1980s, the free market view was very influential in the world economy. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 241 Question 3 True/False 1 of 1 point(s) Virtually all investor countries, including the U.S., have exercised some control over outward FDI from time to time. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 4 Multiple Choice 0 of 1 point(s) Under the auspices of the __________, two extensive multinational agreements were reached in 1997 to liberalize trade in telecommunications and financial services. Your Answer: International Manufacturing and Services Monitoring Commission Correct Answer: World Trade Organization Feedback: Difficulty: MediumPage: 256 Question 5 Multiple Choice 1 of 1 point(s) "FDI can make a positive contribution to a host country by supplying capital, technology, and management skills that would not otherwise be available." This statement best describes the: Your Answer: resource transfer effect Correct Answer: resource transfer effect Feedback: Difficulty: MediumPage: 244 Question 6 Multiple Choice 0 of 1 point(s) Which of the following is not a policy designed to encourage FDI? Your Answer: Tax incentives Correct Answer: The manipulation of tax rules to try to encourage investment at home Feedback: Difficulty: MediumPage: 254 Question 7 True/False 1 of 1 point(s) The free market view argues that international production should be distributed among countries according to the theory of comparative advantage. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 241 Question 8 True/False 0 of 1 point(s) According to the pragmatic nationalist view, FDI should only be undertaken if the benefits outweigh the costs. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 242 Question 9 Multiple Choice 0 of 1 point(s) The basic principle of balance-of-payments accounting is: Your Answer: single-entry bookkeeping Correct Answer: double-entry bookkeeping Feedback: Difficulty: MediumPage: 248 Question 10 Multiple Choice 0 of 1 point(s) The free market ideology of FDI has the following characteristics: Your Answer: views the MNE as an instrument of imperialist domination, views FDI as having both benefits and costs Correct Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Feedback: Difficulty: MediumPage: 244 Question 1 True/False 0 of 1 point(s) To a greater or lesser degree, the officials of many governments tend to be free market advocates who weigh the benefits and costs of FDI and typically lean in favor of liberal FDI policies. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 240 Question 2 True/False 0 of 1 point(s) Few MNEs, despite their large size and financial strength, have access to the same level of financial resources as host-country firms. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 245 Question 3 True/False 0 of 1 point(s) Many investor nations have government-backed insurance programs to cover major types of foreign investment risk. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 4 Multiple Choice 0 of 1 point(s) A __________ occurs when a country exports more goods, services, and income than it imports. Your Answer: debit account surplus Correct Answer: current account surplus Feedback: Difficulty: MediumPage: 248 Question 5 Multiple Choice 0 of 1 point(s) When capital flows out of the United States, it enters the _______ account as a ______. Your Answer: current, credit Correct Answer: capital, debit Feedback: Difficulty: MediumPage: 248 Question 6 Multiple Choice 0 of 1 point(s) The Japanese government has insisted in the past that technology be transferred to Japan through __________, rather than FDI. Your Answer: exporting Correct Answer: licensing Feedback: Difficulty: MediumPage: 245 Question 7 Multiple Choice 0 of 1 point(s) The radical ideology of FDI has the following characteristics: Your Answer: views FDI as having both benefits and costs; classical economic roots Correct Answer: Marxist roots; views the MNE as an instrument of imperialist domination Feedback: Difficulty: MediumPage: 244 Question 8 Multiple Choice 0 of 1 point(s) The pragmatic nationalism ideology has the following host-government policy implications: Your Answer: prohibit FDI; nationalize subsidiaries of foreign-owned MNEs Correct Answer: restrict FDI where costs outweigh benefits; bargain for greater benefits and fewer costs; aggressively court beneficial FDI by offering incentives Feedback: Difficulty: MediumPage: 244 Question 9 Multiple Choice 0 of 1 point(s) If a U.S. citizen owns a share of a Finnish company and receives a dividend payment of $5, that payment shows up on: Your Answer: the Finnish current account as the receipt of $5 of investment income Correct Answer: the U.S. current account as the receipt of $5 of investment income Feedback: Difficulty: MediumPage: 248 Question 10 Multiple Choice 0 of 1 point(s) Many investor nations now have government backed insurance programs to cover major types of foreign investment risk. The types of risks insurable through these programs include all of the following except: Your Answer: the risk of expropriation Correct Answer: strategic business blunders Feedback: Difficulty: MediumPage: 254 Question 1 True/False 1 of 1 point(s) Performance requirements are controls over the behavior of the MNE's local subsidiary. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 256 Question 2 Multiple Choice 1 of 1 point(s) The free market ideology of FDI has the following characteristics: Your Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Correct Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Feedback: Difficulty: MediumPage: 244 Question 3 Multiple Choice 1 of 1 point(s) The most common performance requirements that are intended to restrict inward FDI are related to local content, exports, local participation in top management, and: Your Answer: technology transfer Correct Answer: technology transfer Feedback: Difficulty: MediumPage: 256 Question 4 Multiple Choice 0 of 1 point(s) The radical ideology has the following host-government policy implications: Your Answer: no restrictions on FDI Correct Answer: prohibit FDI; nationalize subsidiaries of foreign-owned FDI Feedback: Difficulty: MediumPage: 244 Question 5 True/False 0 of 1 point(s) Regarding FDI, many host governments are concerned that key decisions that can affect the host country's economy will be made by locals instead of foreign parent. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 252 Question 6 Multiple Choice 0 of 1 point(s) "FDI should be allowed only if the benefits outweigh the costs" is the view espoused by which policy? Your Answer: Radical Correct Answer: Pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 7 True/False 0 of 1 point(s) In regard to host-government policy implications, the free market view is the only view that prohibits FDI. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 240 Question 8 Multiple Choice 1 of 1 point(s) The MNE is seen as an instrument for dispersing the production of goods and services to those locations around the globe where they can be produced most efficiently, according to the _______ view. Your Answer: free market Correct Answer: free market Feedback: Difficulty: MediumPage: 241 Question 9 Multiple Choice 1 of 1 point(s) In practice, many countries have adopted neither a radical policy nor a free market policy toward FDI, but instead a policy that can best be described as: Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 10 Multiple Choice 1 of 1 point(s) The beneficial employment effects claimed for FDI is that it: Your Answer: brings jobs to a host country that would otherwise not be created there Correct Answer: brings jobs to a host country that would otherwise not be created there Feedback: Difficulty: MediumPage: 246 Question 1 Multiple Choice 0 of 1 point(s) In recent years the Japanese government has pressured many Japanese firms to undertake FDI in order to: Your Answer: improve its trade balance Correct Answer: reduce its balance of payments surplus Feedback: Difficulty: MediumPage: 240 Question 2 Multiple Choice 1 of 1 point(s) The free market ideology of FDI has the following characteristics: Your Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Correct Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Feedback: Difficulty: MediumPage: 244 Question 3 True/False 1 of 1 point(s) In regard to host-government policy implications, the free market view is the only view that prohibits FDI. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 240 Question 4 Multiple Choice 0 of 1 point(s) The __________ view traces its roots to classical economics and the international trade theories of Adam Smith and David Ricardo. Your Answer: radical Correct Answer: free market Feedback: Difficulty: MediumPage: 241 Question 5 Multiple Choice 1 of 1 point(s) The Japanese government has insisted in the past that technology be transferred to Japan through __________, rather than FDI. Your Answer: licensing Correct Answer: licensing Feedback: Difficulty: MediumPage: 245 Question 6 True/False 1 of 1 point(s) The capital account of a home country's balance of payments benefits from the inward flow of foreign earnings. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 253 Question 7 True/False 0 of 1 point(s) Host governments use a wide range of controls to restrict FDI in one way or another. The two most common are ownership restraints and geographic restraints. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 255 Question 8 Multiple Choice 1 of 1 point(s) Balance-of-payment accounts are divided into two main sections. These are: Your Answer: the current account and the capital account Correct Answer: the current account and the capital account Feedback: Difficulty: MediumPage: 248 Question 9 Multiple Choice 0 of 1 point(s) The Japanese government sees __________ as a substitute for exporting and thus as a way of reducing Japan's politically embarrassing balance of payments surplus. Your Answer: licensing Correct Answer: foreign direct investment Feedback: Difficulty: MediumPage: 240 Question 10 True/False 1 of 1 point(s) According to the pragmatic nationalist view, FDI should only be undertaken if the benefits outweigh the costs. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 242 Question 1 Multiple Choice 0 of 1 point(s) A distinctive aspect of __________ is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. Your Answer: the radical view Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 2 True/False 1 of 1 point(s) Two of the advantages of FDI to home countries are positive employment effects and positive impact on balance-of-payments. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 253 Question 3 Multiple Choice 1 of 1 point(s) The Japanese government has insisted in the past that technology be transferred to Japan through __________, rather than FDI. Your Answer: licensing Correct Answer: licensing Feedback: Difficulty: MediumPage: 245 Question 4 Multiple Choice 1 of 1 point(s) What is the record of a country's transactions pertaining to merchandise trade, services, and investment income? Your Answer: Current account Correct Answer: Current account Feedback: Difficulty: MediumPage: 248 Question 5 True/False 1 of 1 point(s) In regard to host-government policy implications, the free market view is the only view that prohibits FDI. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 240 Question 6 Multiple Choice 0 of 1 point(s) Within the free market framework, the MNE is: Your Answer: an instrument that fails to distinguish between efficient locations and inefficient locations for the production of goods and services around the world Correct Answer: an instrument for dispersing the production of goods and services to the most efficient locations around the globe Feedback: Difficulty: MediumPage: 241 Question 7 True/False 0 of 1 point(s) In the context of international trade double, taxation refers to fact that in many foreign countries, FDI is taxed at double the domestic rate. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 254 Question 8 True/False 1 of 1 point(s) The four main benefits of FDI for a host country include the resource-transfer effect, the employment effect, the balance-of payments effect, and the effect on competition and economic growth. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 244 Question 9 Multiple Choice 0 of 1 point(s) Which of the following is not one of the benefits of FDI to the home country? Your Answer: Positive employment effects Correct Answer: Negative interest rates effect Feedback: Difficulty: MediumPage: 253 Question 10 True/False 1 of 1 point(s) Host governments use a wide range of controls to restrict FDI in one way or another. The two most common are ownership restraints and geographic restraints. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 255 Question 1 Multiple Choice 1 of 1 point(s) Under the auspices of the __________, two extensive multinational agreements were reached in 1997 to liberalize trade in telecommunications and financial services. Your Answer: World Trade Organization Correct Answer: World Trade Organization Feedback: Difficulty: MediumPage: 256 Question 2 Multiple Choice 0 of 1 point(s) Performance requirements are controls over the behavior of the MNE's: Your Answer: employees Correct Answer: local subsidiary Feedback: Difficulty: MediumPage: 256 Question 3 Multiple Choice 1 of 1 point(s) Until recently, there has been no consistent involvement by multinational institutions in the governing of FDI. This is now changing rapidly with the formation of the __________ in 1995. Your Answer: World Trade Organization Correct Answer: World Trade Organization Feedback: Difficulty: MediumPage: 256 Question 4 Multiple Choice 1 of 1 point(s) Until the collapse of communism between 1989 and 1991, the countries of Eastern Europe were: Your Answer: opposed to FDI Correct Answer: opposed to FDI Feedback: Difficulty: MediumPage: 241 Question 5 Multiple Choice 1 of 1 point(s) A __________ occurs when a country imports more goods, services, and income than it exports. Your Answer: current account deficit Correct Answer: current account deficit Feedback: Difficulty: MediumPage: 248 Question 6 True/False 1 of 1 point(s) Virtually all investor countries, including the U.S., have exercised some control over outward FDI from time to time. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 7 Multiple Choice 0 of 1 point(s) The free market view argues that international production should be distributed among countries according to the theory of: Your Answer: absolute advantage Correct Answer: comparative advantage Feedback: Difficulty: MediumPage: 241 Question 8 True/False 1 of 1 point(s) The four main benefits of FDI for a host country include the resource-transfer effect, the employment effect, the balance-of payments effect, and the effect on competition and economic growth. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 244 Question 9 Multiple Choice 0 of 1 point(s) Many investor nations now have government backed insurance programs to cover major types of foreign investment risk. The types of risks insurable through these programs include all of the following except: Your Answer: war losses Correct Answer: strategic business blunders Feedback: Difficulty: MediumPage: 254 Question 10 Multiple Choice 1 of 1 point(s) The free market ideology of FDI has the following characteristics: Your Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Correct Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Feedback: Difficulty: MediumPage: 244 Question 1 Multiple Choice 1 of 1 point(s) A distinctive aspect of __________ is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 2 Multiple Choice 1 of 1 point(s) The radical ideology has the following host-government policy implications: Your Answer: prohibit FDI; nationalize subsidiaries of foreign-owned FDI Correct Answer: prohibit FDI; nationalize subsidiaries of foreign-owned FDI Feedback: Difficulty: MediumPage: 244 Question 3 Multiple Choice 1 of 1 point(s) Under the auspices of the __________, two extensive multinational agreements were reached in 1997 to liberalize trade in telecommunications and financial services. Your Answer: World Trade Organization Correct Answer: World Trade Organization Feedback: Difficulty: MediumPage: 256 Question 4 Multiple Choice 1 of 1 point(s) The MNE is seen as an instrument for dispersing the production of goods and services to those locations around the globe where they can be produced most efficiently, according to the _______ view. Your Answer: free market Correct Answer: free market Feedback: Difficulty: MediumPage: 241 Question 5 True/False 1 of 1 point(s) Many investor nations have government-backed insurance programs to cover major types of foreign investment risk. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 6 Multiple Choice 0 of 1 point(s) According to the __________ view of FDI, MNEs extract profits from the host country and take them to their home country, giving nothing of value to the host country in exchange. Your Answer: conservative Correct Answer: radical Feedback: Difficulty: MediumPage: 240 Question 7 Multiple Choice 1 of 1 point(s) A __________ occurs when a country exports more goods, services, and income than it imports. Your Answer: current account surplus Correct Answer: current account surplus Feedback: Difficulty: MediumPage: 248 Question 8 Multiple Choice 1 of 1 point(s) Many investor nations now have government backed insurance programs to cover major types of foreign investment risk. The types of risks insurable through these programs include all of the following except: Your Answer: strategic business blunders Correct Answer: strategic business blunders Feedback: Difficulty: MediumPage: 254 Question 9 True/False 0 of 1 point(s) Many countries have a pragmatic stance toward FDI, despite the move towards a free market stance in recent years. Your Answer: false Correct Answer: true Feedback: Difficulty: MediumPage: 257 Question 10 Multiple Choice 1 of 1 point(s) A __________ occurs when a country imports more goods, services, and income than it exports. Your Answer: current account deficit Correct Answer: current account deficit Feedback: Difficulty: MediumPage: 248 Question 1 Multiple Choice 1 of 1 point(s) The basic principle of balance-of-payments accounting is: Your Answer: double-entry bookkeeping Correct Answer: double-entry bookkeeping Feedback: Difficulty: MediumPage: 248 Question 2 Multiple Choice 1 of 1 point(s) The free market ideology of FDI has the following characteristics: Your Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Correct Answer: classical economic roots; views the MNE as an instrument for allocating production to most efficient locations Feedback: Difficulty: MediumPage: 244 Question 3 Multiple Choice 1 of 1 point(s) In practice, many countries have adopted neither a radical policy nor a free market policy toward FDI, but instead a policy that can best be described as: Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 4 True/False 1 of 1 point(s) In the context of international trade double, taxation refers to fact that in many foreign countries, FDI is taxed at double the domestic rate. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 254 Question 5 True/False 1 of 1 point(s) Foreign management skills acquired through FDI may produce important benefits for the host country. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 246 Question 6 True/False 1 of 1 point(s) Regarding FDI, many host governments are concerned that key decisions that can affect the host country's economy will be made by locals instead of foreign parent. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 252 Question 7 True/False 1 of 1 point(s) Few MNEs, despite their large size and financial strength, have access to the same level of financial resources as host-country firms. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 245 Question 8 Multiple Choice 1 of 1 point(s) What is the record of a country's transactions pertaining to merchandise trade, services, and investment income? Your Answer: Current account Correct Answer: Current account Feedback: Difficulty: MediumPage: 248 Question 9 Multiple Choice 0 of 1 point(s) Performance requirements are controls over the behavior of the MNE's: Your Answer: home government Correct Answer: local subsidiary Feedback: Difficulty: MediumPage: 256 Question 10 True/False 1 of 1 point(s) The four main benefits of FDI for a host country include the resource-transfer effect, the employment effect, the balance-of payments effect, and the effect on competition and economic growth. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 244 Question 1 True/False 0 of 1 point(s) Regarding FDI, many host governments are concerned that key decisions that can affect the host country's economy will be made by locals instead of foreign parent. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 252 Question 2 Multiple Choice 1 of 1 point(s) The radical ideology of FDI has the following characteristics: Your Answer: Marxist roots; views the MNE as an instrument of imperialist domination Correct Answer: Marxist roots; views the MNE as an instrument of imperialist domination Feedback: Difficulty: MediumPage: 244 Question 3 True/False 0 of 1 point(s) Few MNEs, despite their large size and financial strength, have access to the same level of financial resources as host-country firms. Your Answer: true Correct Answer: false Feedback: Difficulty: MediumPage: 245 Question 4 Multiple Choice 1 of 1 point(s) The radical ideology has the following host-government policy implications: Your Answer: prohibit FDI; nationalize subsidiaries of foreign-owned FDI Correct Answer: prohibit FDI; nationalize subsidiaries of foreign-owned FDI Feedback: Difficulty: MediumPage: 244 Question 5 True/False 1 of 1 point(s) The capital account of a home country's balance of payments benefits from the inward flow of foreign earnings. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 253 Question 6 Multiple Choice 1 of 1 point(s) The beneficial employment effects claimed for FDI is that it: Your Answer: brings jobs to a host country that would otherwise not be created there Correct Answer: brings jobs to a host country that would otherwise not be created there Feedback: Difficulty: MediumPage: 246 Question 7 True/False 1 of 1 point(s) From 1945 until the 1980s, the free market view was very influential in the world economy. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 241 Question 8 Multiple Choice 1 of 1 point(s) A distinctive aspect of __________ is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 9 Multiple Choice 1 of 1 point(s) The __________ records transactions that involve the purchase or sale of assets. Your Answer: capital account Correct Answer: capital account Feedback: Difficulty: MediumPage: 248 Question 10 Multiple Choice 1 of 1 point(s) The only way in which a current account deficit can be supported in the long run is by: Your Answer: selling off assets to foreigners. Correct Answer: selling off assets to foreigners. Feedback: Difficulty: MediumPage: 249 Question 1 Multiple Choice 1 of 1 point(s) Many investor nations now have government backed insurance programs to cover major types of foreign investment risk. The types of risks insurable through these programs include all of the following except: Your Answer: strategic business blunders Correct Answer: strategic business blunders Feedback: Difficulty: MediumPage: 254 Question 2 Multiple Choice 0 of 1 point(s) Regarding the costs of FDI for the home country, the most important concerns center around: Your Answer: the resource transfer effect and the inflationary pressures caused by FDI Correct Answer: the balance-of-payments and employment effects of outward FDI Feedback: Difficulty: MediumPage: 253 Question 3 Multiple Choice 1 of 1 point(s) The basic principle of balance-of-payments accounting is: Your Answer: double-entry bookkeeping Correct Answer: double-entry bookkeeping Feedback: Difficulty: MediumPage: 248 Question 4 Multiple Choice 1 of 1 point(s) A distinctive aspect of __________ is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 5 Multiple Choice 1 of 1 point(s) The beneficial employment effects claimed for FDI is that it: Your Answer: brings jobs to a host country that would otherwise not be created there Correct Answer: brings jobs to a host country that would otherwise not be created there Feedback: Difficulty: MediumPage: 246 Question 6 Multiple Choice 1 of 1 point(s) If a U.S. citizen owns a share of a Finnish company and receives a dividend payment of $5, that payment shows up on: Your Answer: the U.S. current account as the receipt of $5 of investment income Correct Answer: the U.S. current account as the receipt of $5 of investment income Feedback: Difficulty: MediumPage: 248 Question 7 Multiple Choice 1 of 1 point(s) The most common performance requirements that are intended to restrict inward FDI are related to local content, exports, local participation in top management, and: Your Answer: technology transfer Correct Answer: technology transfer Feedback: Difficulty: MediumPage: 256 Question 8 Multiple Choice 0 of 1 point(s) The Japanese government sees __________ as a substitute for exporting and thus as a way of reducing Japan's politically embarrassing balance of payments surplus. Your Answer: licensing Correct Answer: foreign direct investment Feedback: Difficulty: MediumPage: 240 Question 9 Multiple Choice 1 of 1 point(s) The __________ records transactions that involve the purchase or sale of assets. Your Answer: capital account Correct Answer: capital account Feedback: Difficulty: MediumPage: 248 Question 10 True/False 1 of 1 point(s) Many investor nations have government-backed insurance programs to cover major types of foreign investment risk. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 1 True/False 1 of 1 point(s) Virtually all investor countries, including the U.S., have exercised some control over outward FDI from time to time. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 254 Question 2 Multiple Choice 1 of 1 point(s) In practice, many countries have adopted neither a radical policy nor a free market policy toward FDI, but instead a policy that can best be described as: Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 3 Multiple Choice 1 of 1 point(s) Until the collapse of communism between 1989 and 1991, the countries of Eastern Europe were: Your Answer: opposed to FDI Correct Answer: opposed to FDI Feedback: Difficulty: MediumPage: 241 Question 4 Multiple Choice 1 of 1 point(s) If a U.S. citizen owns a share of a Finnish company and receives a dividend payment of $5, that payment shows up on: Your Answer: the U.S. current account as the receipt of $5 of investment income Correct Answer: the U.S. current account as the receipt of $5 of investment income Feedback: Difficulty: MediumPage: 248 Question 5 True/False 1 of 1 point(s) The four main benefits of FDI for a host country include the resource-transfer effect, the employment effect, the balance-of payments effect, and the effect on competition and economic growth. Your Answer: true Correct Answer: true Feedback: Difficulty: MediumPage: 244 Question 6 True/False 1 of 1 point(s) Few MNEs, despite their large size and financial strength, have access to the same level of financial resources as host-country firms. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 245 Question 7 Multiple Choice 1 of 1 point(s) The MNE is seen as an instrument for dispersing the production of goods and services to those locations around the globe where they can be produced most efficiently, according to the _______ view. Your Answer: free market Correct Answer: free market Feedback: Difficulty: MediumPage: 241 Question 8 Multiple Choice 0 of 1 point(s) Radical writers argue that the multinational enterprise is an instrument of: Your Answer: free market expansionism Correct Answer: imperialist domination Feedback: Difficulty: MediumPage: 240 Question 9 Multiple Choice 1 of 1 point(s) The beneficial employment effects claimed for FDI is that it: Your Answer: brings jobs to a host country that would otherwise not be created there Correct Answer: brings jobs to a host country that would otherwise not be created there Feedback: Difficulty: MediumPage: 246 Question 10 Multiple Choice 1 of 1 point(s) "FDI can make a positive contribution to a host country by supplying capital, technology, and management skills that would not otherwise be available." This statement best describes the: Your Answer: resource transfer effect Correct Answer: resource transfer effect Feedback: Difficulty: MediumPage: 244 Question 1 Multiple Choice 1 of 1 point(s) A __________ occurs when a country exports more goods, services, and income than it imports. Your Answer: current account surplus Correct Answer: current account surplus Feedback: Difficulty: MediumPage: 248 Question 2 True/False 1 of 1 point(s) Regarding FDI, many host governments are concerned that key decisions that can affect the host country's economy will be made by locals instead of foreign parent. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 252 Question 3 Multiple Choice 1 of 1 point(s) Which of the following is not one of the reasons that by the end of the 1980s, the radical position was in retreat almost everywhere in the world? Your Answer: Lobbying efforts on the part of the United Nations in favor of FDI Correct Answer: Lobbying efforts on the part of the United Nations in favor of FDI Feedback: Difficulty: MediumPage: 241 Question 4 Multiple Choice 1 of 1 point(s) What is the record of a country's transactions pertaining to merchandise trade, services, and investment income? Your Answer: Current account Correct Answer: Current account Feedback: Difficulty: MediumPage: 248 Question 5 Multiple Choice 1 of 1 point(s) In practice, many countries have adopted neither a radical policy nor a free market policy toward FDI, but instead a policy that can best be described as: Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242 Question 6 Multiple Choice 1 of 1 point(s) Radical writers argue that the multinational enterprise is an instrument of: Your Answer: imperialist domination Correct Answer: imperialist domination Feedback: Difficulty: MediumPage: 240 Question 7 True/False 1 of 1 point(s) To a greater or lesser degree, the officials of many governments tend to be free market advocates who weigh the benefits and costs of FDI and typically lean in favor of liberal FDI policies. Your Answer: false Correct Answer: false Feedback: Difficulty: MediumPage: 240 Question 8 Multiple Choice 1 of 1 point(s) To encourage inward FDI, many countries offer incentives to foreign firms to invest in their country. Such incentives take many forms, but the most common are tax concessions, grants or subsidies, and: Your Answer: low-interest loans Correct Answer: low-interest loans Feedback: Difficulty: MediumPage: 255 Question 9 Multiple Choice 1 of 1 point(s) Many investor nations now have government backed insurance programs to cover major types of foreign investment risk. The types of risks insurable through these programs include all of the following except: Your Answer: strategic business blunders Correct Answer: strategic business blunders Feedback: Difficulty: MediumPage: 254 Question 10 Multiple Choice 1 of 1 point(s) A distinctive aspect of __________ is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. Your Answer: pragmatic nationalism Correct Answer: pragmatic nationalism Feedback: Difficulty: MediumPage: 242