DECA DECA International Business 1

Question 1

What is a 'tariff' in international trade?

Accepted Answer

A tax imposed by a government on imported or exported goods

Answer

A tariff is a government-imposed tax on imported or exported goods, often used to protect domestic industries or generate government revenue.

Question 2

Which organization oversees the rules governing international trade between nations?

Accepted Answer

World Trade Organization (WTO)

Answer

The World Trade Organization (WTO) establishes and enforces the rules of international trade and provides a forum for negotiating trade agreements between member nations.

Question 3

What is the term for a situation where a country can produce a good at a lower opportunity cost than another country?

Accepted Answer

Comparative advantage

Answer

Comparative advantage means a country can produce a good at a lower opportunity cost relative to another country, forming the basis for mutually beneficial trade.

Question 4

What is 'foreign direct investment' (FDI)?

Accepted Answer

A company investing in business operations or assets in another country

Answer

FDI occurs when a company establishes business operations, builds facilities, or acquires companies in a foreign country, giving it a lasting ownership interest.

Question 5

Which entry strategy requires the LEAST financial risk when entering a foreign market?

Accepted Answer

Exporting

Answer

Exporting requires the least financial commitment because the company sells domestically produced goods abroad without establishing foreign operations or significant capital investment.

(DECA) Distributive Education Clubs of America Practice Test

(DECA) Distributive Education Clubs of America Practice Test

DECA DECA International Business 1