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International Business : The Challenge of Global Competition, 8/e

Donald Ball
Wendell H. McCulloch, California State University Long Beach
Paul L. Frantz, California State University Long Beach
Michael Geringer, California Polytechnic State University
Michael S. Minor, University of Texas Pan American

Legal Forces


1	The Foreign Operations, Export Financing, and Related Appropriations Act banned aid to the ______________ government except for funds for certain forms of humanitarian assistance, funds used to fight drugs, or funds used to promote human rights and democracy.
		A)	Myanmar
		B)	South Africa
		C)	Cambodia
		D)	Iraq


2	Which of the following is not a nonrevenue tax purpose?
		A)	Redistribution of income.
		B)	Encouraging the purchase of domestic rather than imported products.
		C)	Raising revenue.
		D)	Discouraging the consumption of some products.


3	A country that levies one of the highest long-term capital gains taxes is:
		A)	the United Kingdom
		B)	Japan
		C)	Germany
		D)	the United States.


4	The main source of revenue in European Union countries is the:
		A)	income tax.
		B)	value-added tax.
		C)	sales tax.
		D)	capital gains tax.


5	The last state to move away from the unitary tax principle was:
		A)	Florida.
		B)	California.
		C)	New York.
		D)	Texas.


6	The ____________ practice allows the taxpayer to declare a very low taxable income to which the government counters with a very high amount. They then negotiate a compromise figure.
		A)	Italian
		B)	Brazilian
		C)	French
		D)	Mexican


7	Tax treaties:
		A)	are rarely used.
		B)	define such terms as income, source, residency and what constitutes taxable activities in each country.
		C)	hinder the international flow of goods, capital, services and technology.
		D)	prohibit the sharing of information about taxpayers.


8	The Treaty of Rome articles that deal with restrictive trade practices:
		A)	are ineffective.
		B)	do not contain the per se illegality concept of US antitrust law.
		C)	prohibit a cartel that allows consumers a fair share of the benefits.
		D)	are violated by market dominance.


9	When the US Boeing Co. planned a $14 billion takeover of the US McDonnell Douglas Corp. in 1997, the EU Commission:
		A)	was not involved because both companies were US based.
		B)	disapproved the merger.
		C)	approved the merger.
		D)	forced Boeing to also merge with Airbus Industries.


10	Japan's Fair Trade Commission has been nicknamed the:
		A)	toothless tiger.
		B)	avenger.
		C)	terminator.
		D)	UTC (unfair trade commission).


11	A system of __________ liability holds the designer/manufacturer liable for damages caused by a product without the need for a plaintiff to prove negligence in the product's design or manufacture.
		A)	product.
		B)	manufacturer.
		C)	punitive.
		D)	strict.


12	In Greece, travelers who exceed their credit card limits may be sentenced to prison for as long as:
		A)	one year.
		B)	ten years.
		C)	twelve years.
		D)	fifteen years.


13	The most important source of international law is found in:
		A)	local statutes.
		B)	bilateral and multilateral treaties between nations.
		C)	customary international law.
		D)	the United Nations.


14	Intellectual property includes:
		A)	patents
		B)	trademarks
		C)	copyrights
		D)	all of the above.


15	The assumptions that one makes based on the US legal system:
		A)	may not apply in other countries.
		B)	do not apply in other countries.
		C)	are valid in other countries.
		D)	none of the above.


16	A tax system for expatriate citizens of a country whereby the country taxes them on the basis of nationality, even though they live and work abroad is known as:
		A)	national tax jurisdiction.
		B)	territorial tax jurisdiction.
		C)	expatriate tax jurisdiction.
		D)	international tax jurisdiction.


17	The OECD Convention to combat bribery:
		A)	brings laws in other countries closer to the anti-bribery laws in the United States.
		B)	makes it a crime to bribe a foreign official in order to obtain a business deal.
		C)	both "a" and "b".
		D)	bone of the above.


18	In 1977, the US passed the Antiboycott Law forbidding American companies to comply with Arab boycott law or regulation. This law:
		A)	makes it easier for US companies to secure Israeli contracts.
		B)	makes it more difficult for US companies to secure Arab contracts.
		C)	ended Arab-Israeli hostilities.
		D)	applies only to Arab countries.


19	Lawmaking in the European Union:
		A)	resembles that in the US.
		B)	is vested in the Council of Ministers.
		C)	occurs only at the national government level.
		D)	is ineffective.


20	Judges in a common law jurisdiction:
		A)	have the power to interpret the law.
		B)	have the power to apply the law.
		C)	have limited power to expand rules to fit particular cases.
		D)	have the same power is judges in a civil law jurisdiction.

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