1) Which of the following is NOT a reason governments interfere with comparative advantage?

A) Governments attempt to achieve full employment.

B) Governments promote economic development.

C) national self-sufficiency in defense-related industries

D) All are reasons governments interfere with comparative advantage.

2) Of the following, which would NOT be considered a way that government interferes with comparative advantage?

A) tariffs

B) managerial skills

C) quotas

D) other non-tariff restrictions

3) Which of the following is NOT always understood by MNE management?

A) culture, history, and institutions

B) political risk

C) foreign exchange risk

D) financial instruments

4) The twin agency problems limiting financial globalization are caused by these two groups acting in their own self-interests rather than the interests of the firm.

A) rulers of sovereign states and unsavory customs officials

B) corporate insiders and attorneys

C) corporate insiders and rulers of sovereign states

D) attorneys and unsavory customs officials