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WGU Global Economics for Managers (C211, UZC2) Sample Questions:

1. When confronting MNEs, the extender strategy centers on what?

A) Engaging in rapid learning and then expanding overseas
B) Leveraging local assets in areas in which MNEs are weak
C) Leveraging homegrown competencies abroad
D) Cooperating through joint ventures (JVs) with MNEs and sell-offs to MNEs

2. In order to increase the money supply, what does the Federal Reserve do?

A) Buys government bonds from the public
B) Raises the federal funds rate
C) Sells government bonds to the public
D) Increases reserve requirements

3. What is a characteristic of common law as compared to civil law?

A) Common law relies primarily on comprehensive statutes and codes.
B) Common law minimizes the role of judges.
C) Common law is based on religious teachings.
D) Common law is more reliant on precedents from previous judicial decisions.

4. What is one of the four strategic goals of firms looking for potential locations?

A) Scale-seeking
B) Competition-seeking
C) Market-seeking
D) Profit-seeking

5. Managers and firms rationally pursue their interests and make choices within institutional constraints. This is one of the two core propositions underpinning an institution-based view of global business. Which situation illustrates this proposition?

A) Government corruption is rampant in a particular country, leading to a high cost of doing business.However, some smaller companies have figured out how to legally evade the most fraudulent abuses, and for them the cost of doing business becomes much cheaper. For this reason, the companies stay and have a lucrative decade.
B) Two failing banks are pursuing the option of being acquired by another institution. One bank is able to leverage political relationships to result in a successful acquisition. The other bank pursues no such political solution and eventually files for bankruptcy.
C) Several businesses relocate overseas because of a new domestic tax policy that will increase their tax liability by 15%.
D) When a company opens a new production facility, company leaders find out that the laws of that country may allow it to skip several important safety steps. In doing so, the cost of production goes down, but there is a risk to the surrounding environment. The leaders decide not to skip these safety steps out of a deep concern and commitment to environmental protection.

Solutions: