Fins3616 Test Bank Chapter 1

Fundamentals of Multinational Finance, 3e (Moffett)
Chapter 1
Globalization and the Multinational Enterprise

1.1
Multiple Choice and True/False Questions

1)
Which of the following are critical to a firm trying to reach the top of the "firm value pyramid"? A) an open market place B) high quality strategic management C) access to capital D) all of the above Answer:
A
Topic:
Firm Value Skill:
Conceptual

2)
A well-established, large firm U.S.-based MNE will probably not be able to overcome which of the following obstacles to maximizing firm value? A) an open market place B) high quality strategic management C) access to capital D) none of the above Answer:
D
Topic:
Firm Value Skill:
Recognition

3)
Three necessary conditions for a firm to reach the top of the "firm value pyramid" are an open market place, high quality strategic management, and access to capital. Answer:
TRUE
Topic:
Firm Value Skill:
Conceptual

4)
A well-established, large China-based MNE will probably be most adversely affected by which of the following elements of firm value? A) an open marketplace B) high-quality strategic management C) access to capital D) access to qualified labor pool Answer:
A
Topic:
Firm Value Skill:
Conceptual

5)
A well-established, large, Brazil-based MNE will probably be most adversely affected by which of the following elements of firm value? A) an open marketplace B) high-quality strategic management C) access to capital D) access to qualified labor pool Answer:
C
Topic:
Firm Value Skill:
Conceptual

6)
The theory that suggests specialization by country can increase worldwide production is ________. A) the theory of