INTERNATIONAL business exam
IBUS/MARK 462
SECOND EXAM – WINTER 2013
STUDY QUESTIONS
A. Definitions –four will be chosen for the exam
Transaction exposure: The extent to which income from individual transactions is affected by fluctuations in foreign exchange values.
Balance-of-trade equilibrium: Reached when the income a nation’s residents earn from exports equals money paid for imports.
Spot exchange rate: The exchange rate at which a foreign exchange dealer will convert one currency into another that particular day.
Carry trade: A kind of speculation that involves borrowing in one currency where interest rates are low, and then using the proceeds to invest in another currency where interest rates are high.
Forward exchange: when two parties agree to exchange currency and execute a deal at some specific date in the future.
(not definition, but worth knowing) Forward exchange rate*: exchange rates governing foreign exchange transactions
Dirty float: a system under which a country’s currency is nominally allowed to float freely against other currencies, but in which the government will intervene, buying and selling currency, if it believes that the currency has deviated too far from its fair value
Location economies: cost advantages from performing a value creation activity at the optimal location for that activity
Transnational strategy: plan to exploit experience-based cost and location economies, transfer core competencies with the firm, and pay attention to local responsiveness.
Primary activities: activities that are directly concerned with creating and delivering a product. These include inbound logistics, operations, outbound logistics, marketing and sales, and service.
Experience curve: Systematic production cost reductions that occur over the life of a product.
Support activities: Activities which are not directly involved in production, but may increase effectiveness or efficiency. These include procurement, human resource management, technology
SECOND EXAM – WINTER 2013
STUDY QUESTIONS
A. Definitions –four will be chosen for the exam
Transaction exposure: The extent to which income from individual transactions is affected by fluctuations in foreign exchange values.
Balance-of-trade equilibrium: Reached when the income a nation’s residents earn from exports equals money paid for imports.
Spot exchange rate: The exchange rate at which a foreign exchange dealer will convert one currency into another that particular day.
Carry trade: A kind of speculation that involves borrowing in one currency where interest rates are low, and then using the proceeds to invest in another currency where interest rates are high.
Forward exchange: when two parties agree to exchange currency and execute a deal at some specific date in the future.
(not definition, but worth knowing) Forward exchange rate*: exchange rates governing foreign exchange transactions
Dirty float: a system under which a country’s currency is nominally allowed to float freely against other currencies, but in which the government will intervene, buying and selling currency, if it believes that the currency has deviated too far from its fair value
Location economies: cost advantages from performing a value creation activity at the optimal location for that activity
Transnational strategy: plan to exploit experience-based cost and location economies, transfer core competencies with the firm, and pay attention to local responsiveness.
Primary activities: activities that are directly concerned with creating and delivering a product. These include inbound logistics, operations, outbound logistics, marketing and sales, and service.
Experience curve: Systematic production cost reductions that occur over the life of a product.
Support activities: Activities which are not directly involved in production, but may increase effectiveness or efficiency. These include procurement, human resource management, technology