Understanding Country Risks & Their Impact on Trade, Quizzes of Introduction to Business Management

Download Understanding Country Risks & Their Impact on Trade and more Quizzes Introduction to Business Management in PDF only on Docsity! TERM 1 Country risk assessment (CRA) DEFINITION 1 o__________ _____ ____ - Is an evaluation, conducted by a bank or business, that asses a countrys economic situation and policies and its politics to determine how much risk exists of losing an investment or not being paid. TERM 2 country risk DEFINITION 2 _____ _____: can be Political in nature: Economic/Financial Legal TERM 3 Political in nature DEFINITION 3 type of country risk: ______: wars, revolutions, coups, government changes caused by election of a new government that may be hostile to private business and particularly to foreign-owned business ex: Urkraine not a good choice= high risk TERM 4 Economic/Financial: DEFINITION 4 type of country risk:____/_____: persistent balance-of- payments deficits or high inflation rates, repayment of loans questionable. Labor conditions may cause investors to pause. Labor productivity may be low, or labor unions may be militant. TERM 5 Legal DEFINITION 5 type of country risk:___: laws may be changed in regard to such subjects as taxes, currency convertibility, tariffs, quotas, and labor permits. The chance for a fair trial in local court must be asses. And terrorism may be present TERM 6 world trade organization DEFINITION 6 an international organization that deals with rules of trade between nations. (Is the only global international organization designed to establish and help implement rule of trade between nations) TERM 7 world trade organization DEFINITION 7 -goal is to reduce or eliminate trade barriers and restrictions worldwide to help producers of goods and services exporters, importers conduct their business by reducing costs TERM 8 sanctions DEFINITION 8 o _________: actionbyoneormorestatestowardanotherstatecalculatedtoforceittocomply withlegalobligations. o Pros: kill fewer people than the alternative war o Cons: They punish the wrong people. Typically, the _____ harm the ordinary citizens more than thegovernmentbeing sanctioned. Usually, the government was not democratically elected, so the people being harmed were not at fault. TERM 9 boycotts DEFINITION 9 o _________ pros and cons toabstainfrombuyingorusing o Pros: TERM 10 Nationalization DEFINITION 10 ______: Why?Extract money: government suspects hidden profitsProfitability: government seeks to increase firms efficiency and profits IdeologyJob preservation: government saves jobs by saving dying industries Control follows money: subsidized firms often targets of nationalization Happenstance: nationalization of German firms after World War II ex: GM TERM 21 Absolute DEFINITION 21 type of quota:______:once the specified amount has been imported, further importation for the rest of the period (usually a year) is prohibited TERM 22 Global DEFINITION 22 type of quota:_____:a total amount is fixed without regard to source TERM 23 Allocated DEFINITION 23 type of quota:______:the government of the importing nation assigns quantities to specific countries TERM 24 Voluntary export restraints (VERs) DEFINITION 24 type of nontariff barrier:_____ _____ _____: export quotas imposed by the exporting nation TERM 25 Orderly marketing arrangements DEFINITION 25 type of nontariff barrier:_______ ___ ____: are VERs consisting of formal agreements between the governments of exporting and importing countries to restrict international competition and preserve some of the nation market for local producers. TERM 26 Nonquantitiatve DEFINITION 26 type of nontariff barrier:_____ Nontariff barriers : Direct government participation in trade Customs and other administrative procedures Standardsex: fair trade TERM 27 1789 DEFINITION 27 Sugar Subsidies Global Debate When did the US sugar subsidies begin? TERM 28 Politics, being overlooked, lobbyist trying very hard to keep system in place DEFINITION 28 Sugar Subsidies Global DebateWhy do they continue? TERM 29 Sugar producers A mere 1% of sugar growers enjoys 42% of the benefits DEFINITION 29 Sugar Subsidies Global DebateWho wins? TERM 30 American consumers, American manufacturing companies, other countries that want to export sugar to the US DEFINITION 30 Sugar Subsidies Global DebateWho loses? TERM 31 Some US companies going other places where cheaper DEFINITION 31 Sugar Subsidies Global DebateLabor-offshoring issues? TERM 32 American sugar producers DEFINITION 32 Sugar Subsidies Global DebateIF we had truly free trade with all countries who would lose?