This quiz on Foreign Direct Investment (FDI) explores key aspects such as reasons behind China's high FDI, types of FDI, and trade flow components. It assesses understanding of trade imbalances and value addition in international trade, focusing on practical and theoretical implications.
Ford Motor Company acquires the British firm Jaguar.
Lenovo, a Chinese company, acquires IBM's personal computing business.
The Venezuelan government acquires the Venezuelan operations of BP Petroleum, a British firm.
General Motors Corporation builds a plant in China to supply Buicks to the Chinese market.
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Sales or purchases of goods by residents of different countries
Sales of goods by domestic residents to foreign residents
Purchases of services by domestic residents from foreigners
Sales or purchases of goods by residents of different countries, sales of goods by domestic residents to foreign residents, and purchases of services by domestic residents from foreigners
All of the above
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The bilateral trade balance is a good indicator of the inequality of imports and exports between the United States and China.
The bilateral trade balance vastly understates the gap in imports and exports between the United States and China.
The bilateral trade balance may overstate the gap in imports and exports between the United States and China because some of the manufacturing inputs used do not originate in China.
The bilateral trade balance shows that there is balanced trade between the United States and China.
None of the above.
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The difference between the value of the imported inputs and the value of the exported product.
The additional value a worker provides to a firm when she is hired.
The value added by being able to purchase goods in a competitive market.
The value added by import brokers when they mark up the price of the products.
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The real figures are even more shocking.
It is not as bad as the numbers appear due to the fact that China imports from its other trading partners up to 80 percent of the value of the export.
It depends on how you count imports and exports and on which currency is used.
Irresponsible governments, corruption, and greedy corporations are responsible for the widening gap.
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$250 billion
$700 billion
$1 trillion
$0.5 trillion
None of the above.
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Canada, Mexico, and Japan
Japan, China, South Korea, and Thailand
Nations in the European Union
Middle Eastern countries
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(1) only
(1) and (2) only
(2) only
(3) only
(2) and (3) only
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Its trade-to-GDP ratio is 20%.
It is not a successful country.
Its GDP needs to increase.
Its trade-to-GDP ratio is too high.
Its trade-to-GDP ratio is 2%
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Hong Kong, China
Japan
Germany
The United States
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Ford Motor Company acquires the British firm Jaguar.
Lenovo, a Chinese company, acquires IBM's personal computing business.
Daimler-Benz, a German company, merges with Chrysler Corporation, an American company, to form the Daimler-Benz Corporation.
General Motors Corporation builds a plant in China to supply Buicks to the Chinese market.
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The cotton gin.
The wheel.
Improved methods of transporting goods.
The computer.
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It increases the volume of trade.
It reduces the volume of imports.
It increases the volume of imports.
It promotes better trade relations with other countries.
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A renewed effort to re-establish international trade and the flow of payments via new international organizations.
A focus on environmental and labor problems caused by trade.
A renewed emphasis on gold as a means of payment.
Increased flows of foreign aid to low-income nations.
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$390 billion
Not enough information is provided to answer the question.
$190 billion
$100 billion
None of the above
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To avoid tariffs or other trade barriers
To have improved facilities and information for marketing products
To take advantage of inexpensive labor
To share expertise and avoid possible duplication of products
All of the above except C are reasons for horizontal FDI
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An American company purchases a British soccer team.
Ford Motor company establishes a plant in Canada.
GM opens a plant in India.
BMW opens a plant in Bilbao, Spain.
None of the above.
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The ratio of its exports to its GDP
The ratio of its imports to its GDP
The ratio of its trade balance (exports minus imports) to its GDP
The ratio of its exports plus imports to its GDP
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Purchases of goods.
Purchases of services
Purchases of stocks and bonds.
Purchases of software.
All are included in trade flows
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