DECA DECA International Business 2 — Questions and Answers
Question 1: What is 'cultural intelligence' (CQ) in international business?
- Fluency in multiple foreign languages
- The ability to function effectively across different cultural contexts (Correct answer)
- Knowledge of international tax laws
- Skill in converting currency between nations
Correct answer: The ability to function effectively across different cultural contexts
Cultural intelligence is the capability to relate and work effectively across cultures by understanding and adapting to different cultural norms, values, and behaviors.
Question 2: Which of the following is an example of a non-tariff trade barrier?
- Import duties
- Import quotas limiting the quantity of goods allowed in (Correct answer)
- Customs fees on all goods
- Excise taxes on domestic products
Correct answer: Import quotas limiting the quantity of goods allowed in
Import quotas are non-tariff barriers because they restrict the quantity of a good that can be imported without using a price-based tax mechanism.
Question 3: What is a 'joint venture' in international business?
- A company acquiring 100% of a foreign firm
- Two or more companies sharing ownership of a new entity in a foreign market (Correct answer)
- One company licensing its technology to a foreign firm
- A company exporting goods through a foreign distributor
Correct answer: Two or more companies sharing ownership of a new entity in a foreign market
A joint venture is a strategic alliance where two or more companies create a jointly owned entity to enter a foreign market, sharing resources, risks, and profits.
Question 4: What does NAFTA/USMCA govern?
- Defense treaties between the U.S., Canada, and Mexico
- Trade relations between the United States, Canada, and Mexico (Correct answer)
- Immigration policies across North America
- Environmental standards for North American factories
Correct answer: Trade relations between the United States, Canada, and Mexico
USMCA (which replaced NAFTA) is a free trade agreement governing tariffs, trade rules, intellectual property, and labor standards between the U.S., Canada, and Mexico.
Question 5: What is 'currency exchange risk' in international business?
- The risk of a foreign government nationalizing assets
- The potential loss from fluctuating foreign exchange rates affecting profits (Correct answer)
- The risk of customers not paying in foreign markets
- The danger of counterfeiting foreign currency
Correct answer: The potential loss from fluctuating foreign exchange rates affecting profits
Currency exchange risk is the financial risk that changes in exchange rates will negatively affect the value of international transactions or investments.
Question 6: Which DECA competitive event focuses on international business concepts?
- International Business Plan (Correct answer)
- Retail Merchandising Series
- Hospitality and Tourism Operations
- Financial Services Consulting
Correct answer: International Business Plan
The International Business Plan event challenges DECA members to develop a comprehensive plan for entering a foreign market, covering research, strategy, and financial projections.
DECA DECA International Business 2
What is 'cultural intelligence' (CQ) in international business?