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| 1 | |
Both smaller and larger firms tend to be proactive about seeking export opportunities. |
| | A) | True |
| | B) | False |
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| 2 | |
One big impediment to export success is a lack of knowledge regarding opportunities available for a firm’s product. |
| | A) | True |
| | B) | False |
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| 3 | |
Both the US Department of Commerce and the Small Business Administration actively provide information for US companies that wish to export. |
| | A) | True |
| | B) | False |
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| 4 | |
Domestic and international practices follow the same sequence – goods are shipped, often on open account, and payment follows. |
| | A) | True |
| | B) | False |
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| 5 | |
Counterpurchase is a synonym for countertrade. |
| | A) | True |
| | B) | False |
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| 6 | |
Which of the following is not one of the significant problems encountered by beginning exporters? |
| | A) | Poor market analysis |
| | B) | Poorly executed promotional campaigns |
| | C) | Lack of an effective distribution program |
| | D) | Too much time spent cultivating business in foreign markets |
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| 7 | |
With voluminous paperwork, complex regulations and potential delays and errors, a UN report calculated that these costs often amount to __________ of the final value of the goods exported. |
| | A) | more than 20 percent |
| | B) | about 10 percent |
| | C) | about 5 percent |
| | D) | less than 1 percent |
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| 8 | |
One drawback of relying on export management companies is that _______________. |
| | A) | the firm ends up duplicating effort |
| | B) | some countries and regional trade associations forbid their use |
| | C) | their expertise is limited to certain industries |
| | D) | the company can fail to develop its own exporting capabilities |
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| 9 | |
Which of the following is not one of the simple, strategic steps a firm can undertake to increase the chances of success in exporting? |
| | A) | Develop a shotgun approach with the understanding that a few of the markets will succeed and cover the losses encountered in not so successful markets |
| | B) | Hire local personal to help with problems and opportunities “on the ground” |
| | C) | Recognize a lot of time and effort will be required of management |
| | D) | Hire a consultant or EMC if the firm is just starting out |
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| 10 | |
In international trade, the buyer and seller may not know each other, and there can be a profound lack of trust due to differences in culture, legal systems and distance. The problem is usually solved by using ___________________ to function as intermediaries. |
| | A) | social media of the Internet, including Facebook |
| | B) | commercial attachés from their respective governments |
| | C) | reputable third parties, often banks |
| | D) | WTO representatives and branches |
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| 11 | |
One drawback the importer must face when using a letter of credit is that ________________. |
| | A) | the letter is a financial liability against the importer and may reduce the firm’s ability to borrow funds for other purposes |
| | B) | the larger the transaction, the more banks charge |
| | C) | it is difficult to find banks in both countries that will trust each other |
| | D) | there are both cultural and commercial prohibitions in many Western countries |
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| 12 | |
Which of the following is NOT one of the functions of a bill of lading? |
| | A) | It is a receipt. |
| | B) | It is a contract. |
| | C) | It is an invoice. |
| | D) | It is a document of title. |
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| 13 | |
The _______________________ is an independent agency of the U.S. government providing financing aid to facilitate imports, exports and the exchange of commodities between the United States and other countries. |
| | A) | Commerce Department |
| | B) | Small Business Administration Financing Division |
| | C) | World Bank |
| | D) | Export-Import Bank |
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| 14 | |
The Foreign Credit Insurance Association provides coverage against political and commercial risks, and it operates under the guidance of the: |
| | A) | Bank for International Settlements. |
| | B) | World Bank. |
| | C) | World Trade Organization. |
| | D) | Export-Import Bank. |
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| 15 | |
Which one of these is NOT a drawback of countertrade? |
| | A) | Not being paid in hard currency |
| | B) | Being given shoddy goods |
| | C) | Arranging for profitable disposal |
| | D) | Access to marketing opportunities |
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