Business Environment

271. Free international trade maximizes world output through

  1. Countries specializing in production of goods they are best suited for
  2. Reduction in taxes
  3. Increased factor income
  4. Encouraging competition
Correct answer: (A)
Countries specializing in production of goods they are best suited for

272. No new investment in the host country is created in the case of

  1. Greenfield FDI
  2. Acquisition
  3. Horizontal FDI
  4. Vertical FDI
Correct answer: (B)
Acquisition

273. Non- verbal communication

  1. includes written communication
  2. has no place in international business
  3. includes body language
  4. should be learnt by business managers to communicate with foreigners
Correct answer: (C)
includes body language

274. Lower power distance countries are characterized by

  1. relationships based on equality and informality
  2. authority being accepted without question
  3. managers being paternalistic
  4. tall organizations structure
Correct answer: (A)
relationships based on equality and informality

275. The income level of residents in a country is indicated by

  1. gross national income
  2. gross domestic product
  3. per capita gross national income
  4. per capita gross domestic product
Correct answer: (C)
per capita gross national income

276. Which of the following statements in relation to the Five Forces framework is correct?

  1. The framework assists in developing a broad perspective on the environment within which an organisation is operating
  2. It is not appropriate in public sector management
  3. The framework is a means of identifying the forces which affect the level of competition in an industry or sector
  4. The framework identifies the major stakeholders of an organisation
Correct answer: (C)
The framework is a means of identifying the forces which affect the level of competition in an industry or sector

277. Market segmentation aims to

  1. Identify the similarities and differences between groups of customers or users
  2. Identify the similarities between groups of customers or users
  3. Identify the differences between organisations and their competitors
  4. Identify the needs and wants of all customers or users
Correct answer: (A)
Identify the similarities and differences between groups of customers or users

278. The following represent major reactive motives for initiating export

  1. ended sales of seasonal products
  2. competitive pressures
  3. overproduction/excess capacity and unsolicited foreign orders
  4. all of the above
Correct answer: (D)
all of the above

279. Among the factors that affect the balance of trade figures are

  1. exchange rates, taxes, tariffs and trade measures
  2. the business cycle at home or abroad
  3. trade barriers and agreements
  4. non tariff barriers
Correct answer: (A)
exchange rates, taxes, tariffs and trade measures

280. The legal system in India is based on

  1. Common law
  2. Civil law
  3. Theocratic law
  4. Hindu law
Correct answer: (D)
Hindu law
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