Test Bank For Global Business 4th Edition By Mike Peng

Chapter 1 Globalizing Business
TRUEFALSE
1. A multinational enterprise is a firm that engages in foreign direct investment by directly investing
in, controlling, and managing value-added activities in other countries.
(A) True
(B) False
Answer : (A)
2. The term “emerging markets” refers to all markets other than the developed markets.
(A) True
(B) False
Answer : (A)
3. Gross domestic product (GDP) is the sum of value added by resident firms, households, and
governments operating in an economy.
(A) True
(B) False
Answer : (A)
4. Majority of the global GDP is contributed by the emerging markets.
(A) True
(B) False
Answer : (B)
5. Purchasing power parity (PPP) is a conversion that determines the equivalent amount of goods
and services different currencies can purchase.
(A) True
(B) False
Answer : (A)
6. Purchasing power parity (PPP) is calculated as the sum of value added by resident firms,
households, and governments operating in an economy.
(A) True
(B) False
Answer : (B)
7. Emerging markets contribute about 30% of global GDP without adjusting for purchasing power
parity (PPP).
(A) True
(B) False
Answer : (A)
8. More than half the GDP produced by emerging markets comes from outside the BRIC countries.
(A) True
(B) False
Answer : (B)