1) What is an advantage of foreign direct investment?

A. Avoids import taxes

B.Helps in retaining advantage over competition

C.Reduces transportation costs

D.All of the above

2) Historically, what has been the entry point for most companies into the world of international business?

A.Transfer pricing

B.Foreign direct investment

C.Cross-listing on international stock exchanges


3) Which of the following is an example of a “greenfield” investment?

A.Toyota, a Japanese automaker, builds an assembly plant in Ohio, U.S.A.

B.Daimler, a German automaker, merges with Chrysler, a U.S. automaker.

C.Nike contracts with a footwear company in China to make athletic shoes.

D.A Chinese oil company buys a U.S. oil company.

4) Which of the following is a reason for the tremendous increase in the flow of foreign direct investment since1990?

A.The liberalization of investment laws in many countries

B.The universal application of U.S. GAAP accounting standards

C.The relaxation of transfer pricing regulations

D.The similarities in tax rates and tax laws across the globe

5) Which of the following is a reason a company might decide to cross-list on a foreign stock exchange?

A.It wants to hedge against currency fluctuations.

B.It is less expensive than listing itself solely on a domestic exchange.

C.It is required for accomplishing foreign direct investment.

D.It wants to obtain acquisition currency for acquiring a foreign company.

6) The number of companies involved in international trade has grown significantly in recent years. What percent of U.S. exporters are relatively small companies (i.e. less than 500 employees)?


B.More than 90%

C.Less than 5%


7) Use the following World Trade Organization report to order the following countries from the largest importing economy to the smallest.

#1 = largest importer, #5 = smallest importer

Access the full report — Use only Table A.6: https://www.wto.org/english/res_e/statis_e/wts2020_e/wts2020chapter06_e.pdf

– 1. 2. 3. 4. 5.  

United States

– 1. 2. 3. 4. 5.  


– 1. 2. 3. 4. 5.  


– 1. 2. 3. 4. 5.  


– 1. 2. 3. 4. 5.  

United Kingdom

8) The New York Stock Exchange (NYSE) provides a list of all Non-US companies listed on the exchange on its website. Select the two countries with the largest total number of companies listed on the NYSE as of April 30, 2020.

Access the company list: https://www.nyse.com/publicdocs/nyse/data/CurListofallStocks.pdf


B.United Kingdom



9) The London Stock Exchange (LSE) provides a list of all companies listed on the exchange on its website. Select the two countries (from the list below) with the largest total number of companies listed on the LSE as of February 28, 2021.

Access the company list: https://docs.londonstockexchange.com/sites/default/files/reports/Issuer%20list_10.xlsx





10) Use the following US Census Bureau report. What is the number of US companies engaging in imports in 2018?

Access the report: https://www.census.gov/foreign-trade/Press-Release/edb/2018/text.pdf

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