Gap filling

1. The purchase, sale, or exchange of goods and services across national borders is called
__________
=> International Trade
2. A trade theory which holds that a government can improve the economic well-being of the
country by encouraging exports and stifling imports to accumulate wealth in the form of
precious metals
=> mercantilism
3. ___________ is the condition that results when the value of a country’s exports is greater
than the value of its imports.
=> trade surplus
4. A condition that results when the value of a country's imports is greater than the value of its
exports is called_________
=> trade deficit
5. Sending goods to another country for sale or trade is called a__________
=> exporting
6. A trade theory which holds that nations can increase their economic well-being by specialising
in goods that they can produce more efficiently than anyone else is called_______
=> theory of absolute advantage
7. Bringing in goods from another country for sale or trade is called_________
=> importing

8. ________ is a trade theory which holds that nations should produce those goods for which
they have the greatest relative advantage.

=> theory of comparative advantage

9. A trade theory which holds that nations will produce and export products that use large
amounts of production factors that they have in abundance and will import products
requiring a large amount of production factors that they lack.

=> factor endowment theory

10. Financial assistance to domestic producers in the form of cash payments, low-interest loans,
tax breaks, product price supports, or some other form is called ________.

=> subsidy

11. When a government guarantees that it will repay the loan of a company if the company
should default on repayment, it is called a ________.
=> loan guarantee

12. A designated geographic region in which merchandise is allowed to pass through with lower
customs duties and/or fewer customs procedures is called a (n) ________.

=> foreign trade zone

13. ________ is a theory of the stages of production of a product with new "know-how": it is first
produced by the parent firm, then by its foreign subsidiaries, and finally anywhere in the
world where costs are the lowest; it helps explain why a product that begins as a nation’s export
often ends up as an import.

=> international production life cycle theory

14. A complete ban on trade (imports and exports) in one or more products with a particular
country is called an ________.

=> embargo

15. The ________ is the only international body dealing with rules of trade between nations.

=> WTO

16. ________ is a trade theory which holds that a government can improve the economic well-
being of the country by encouraging exports and stifling imports.

=> neo-mercantilism

17. ________ is a treaty that was designed to promote free trade by reducing both tariffs and
non-tariff barriers to international trade.

=> GATT

18. ________ is a trade theory that extends the concept of comparative advantage by bringing
into consideration the endowment and cost of factors of production and helps to explain why
nations with relatively large labour forces will concentrate on producing labour-intensive
goods, whereas countries with relatively more capital than labour will specialise in capital-
intensive goods.

=> Heckscher Ohlin theory

19. A finding by Wassily Leontief, a Nobel Prize-winning economist, which shows that the
United States, surprisingly, exports relatively more labour-intensive goods and imports
capital-intensive goods.

=> Leontif Paradox

20. Countries import some goods and services from abroad, and export others to the rest of the
world. Trade in ________ is called visible trade in Britain and merchandise trade in the US.

=> commodities

21. The LDCs export a limited range of ________ commodities such as foodstuffs, fuels, and
industrial raw materials, etc.

=> primary

22. ________ are the ratio of the unit price of exports to the unit price of imports.

=> terms of trade

23. A ______ is a government tax levied on a product as it enters or leaves a country.

=> Tariff

24. A tariff levied by the government of a country that is exporting a product is called an ___

=> export tariff

25. A tariff levied by the government in a country that is importing a product is called an___

=> import tariff

26. A tariff levied as a percentage of the stated price of an imported product is called___

=> ad valorem

27. A tariff levied as a specific fee for each unit( measured by number, weight, etc.) of an
imported product is called_____

=> specific tariff

28. A tariff levied on an imported product and calculated partly as a percentage of its stated price,
and partly as a specific fee for each unit is referred to as a(n)_____

=> compound tariff

29. The______ is the only international body dealing with rules of trade between nations
=> WTO

30. When a company exports a product at a price lower than the price normally charged in its
domestic market, it is said to be_____

=> Dumping

1. ________ is the balance between exports and imports in an economy.

 Balance of trade

2. ________ showing trade in goods and services, income, and unrequited transfers (e.g.,
foreign aid payments, workers remittances, etc.) over a specified period.

 Current account

3. ________ is a non-binding intergovernmental instrument that seeks to regulate certain

types of behavior of governments or private corporations.

 Code of conduct

4. ________ records currency inflows and outflows due to international dealings in financial
assets, such as investments and loans.

 Capital account

5. ________ is a statistical summary of a country’s total trade, other economic transactions,

and financial flows at a given time.

 Balance of payment

6. ________ laws are designed to protect domestic producers and sellers of goods, whereas
________ are meant to protect consumers and importers.

 Anti-dumping, competition laws

7. The theory of ________ states that the success of a firm or an industry is based on cost
advantages in the production of a relatively standardized product or product-based
advantages related to the development of differentiated products.

 Competitive advantage

8. ________ means approaches of governments to the promotion and protection of

competition. It is often seen as promoting especially the interests of the consumer.

 Competition policy
9. ________ describes the increasing integration of national economic systems through
growth in international trade, investment, and capital flows.

 globalisation

10. ________ covers governmental acts, policies, and practices which influence trade in
goods and services.

 Commercial policy

11. ________ is the extension of economic activity across national borders to harness the
benefits of lower costs in other economies, with countries specializing in a particular
stage of production.

 internationalisation

12. ________ preventing the exposure of domestic producers to the rigors of the international
market.

 protectionism

13. ________ the free movement across borders of goods, services, capital, and people.

 Free trade

14. ________ is a general term for the gradual or complete removal of existing impediments
to trade in goods and services.

 Trade liberalisation

15. ________ is an agreement between two countries setting out the conditions under which
trade between them will be conducted.

 Bilateral trade agreement

16. ________ the complete framework of laws, regulations, international agreements, and
negotiating stances adopted by the government to achieve legally binding market access
for domestic firms.

 Trade policy

17. ________ An approach to the conduct of international trade based on cooperation, equal
rights and obligations, non-discrimination, and the participation as equals of many
countries regardless of their size or share of international trade.

 multilateralism
18. ________ is an intergovernmental agreement aimed at expanding and liberalizing
international trade under non-discriminatory, predictable, and transparent conditions set
out in an array of rights and obligations.

 Multilateral trade agreement

19. ________ is a group of countries committed to the pursuit of a common external trade
policy.

 Common market

20. ________ is a system under which the exchange rate for converting one currency into
another is continuously adjusted depending on the laws of supply and demand.

 Floating exchange rate system

21. ________ is the absence of barriers to the free flow of goods and services between
countries.

 Free trade

22. ________ International treaty that committed signatories to lowering barriers to the free
flow of goods across national borders led to the WTO.

 GATT

23. ________ means moving away from an economic system in which national markets are
distinct entities.

 Globalisation of markets

24. ________ is foreign direct investment in the same industry abroad as a firm operates at
home.

 Horizontal FDI

25. ________ states that new industries in developing countries must be temporarily protected
from international competition to help them reach a position where they can compete on
world markets with the firms of developed nations.

 Imfant industry argument

26. ________ is a requirement that some specific fraction of a good be produced

domestically.

 Local content requirement

 27. ________ is a quota on trade imposed from the exporting country’s side, instead of the
importer’s; usually imposed at the request of the importing country’s government.

 Voluntary export restrain (VER)

28. ________ is a country with exceptionally low, or no, income taxes.

 Tax haven

29. ________ is an economic philosophy advocating that countries should simultaneously

encourage exports and discourage imports.

 mercantilism

30. ________ means the level of output at which most plant-level scale economies are
exhausted.

 Minimum efficient scale

31. ________ is a staffing policy in an MNE in which host-country nationals are recruited to
manage subsidiaries in their own country, while parent-country nationals occupy key
positions at corporate headquarters.

 Polycentric staffing

32. ________ is a situation in which all countries can benefit even if some benefit more than
others.

 Positive sum game

33. ________ is a measure of how responsive demand for a product is to changes in price.

 Price elasticity of demand

34. ________ is government financial assistance to a domestic producer.

 subsidy

35. ________ means certain sectors of the economy are left to private ownership and free
market mechanisms, while other sectors have significant government ownership and
government planning.

 Mixed economy

1. The market in which currencies are bought and sold and in which currency prices are
determined is called the ________.

=> foreign exchange market

2. The practice of insuring against potential losses that result from adverse changes in
exchange rates is called ________.

 Currency hedging

3. ________ is the instantaneous purchase and sale of a currency in different markets for
profit.

 Currency arbitrage

4. ________ is the purchase or sale of a currency with the expectation that its value will
change and generate a profit.

 Currency speculation

5. In a quoted exchange rate, the currency with which another currency is to be purchased is
called the ________.

 Quoted currency

6. In a quoted exchange rate, the currency that is to be purchased with another currency is
called the ________.

 Base currency

7. The exchange rate requiring delivery of the traded currency within two business days is
called the ________.

 Spot rate

8. The exchange rate at which two parties agree to exchange currencies on a specified
future date is called the ________.

 Forward rate

9. ________ is a contract requiring the exchange of an agreed-upon amount of a currency

on an agreed-upon date at a specific exchange rate.

 Forward contract

10. ________ is the simultaneous purchase and sale of foreign exchange for two different
dates.

 Currency swaps

11. Currency that trades freely in the foreign exchange market, with its price determined by
the forces of supply and demand is called a ________.

 Convertible/hard currency
12. An international monetary system in which nations linked the value of their paper
currencies to specific values of gold was called the ________.

 Gold standard

13. A system in which the exchange rate for converting one currency into another is fixed by
international agreement is called a ________.

 Fixed exchange rate system

14. The ________ was an accord among nations to create a new international monetary
system based on the value of the U.S. dollar.

 Bretton Woods Agreement

15. The agency created by the Bretton Woods Agreement to provide funding for national
economic development efforts is called the ________.

 World Bank

16. ________ was the agency created by the Bretton Woods Agreement to regulate fixed
exchange rates and enforce the rules of the international monetary system.

 IMF

17. An exchange-rate system in which currencies float against one another with
governments intervening to stabilize currencies at a particular target exchange rate is
known as a ________.

 Managed float system

18. ________ is an exchange-rate system in which currencies float freely against one
another, without governments intervening in currency markets.

 Free float system

19. The exchange rate at which the bank will buy a currency is called a ________.

 Buy rate

20. ________ is called the exchange rate at which the bank will sell a currency.

 Ask rate

21. ________ is a right, or option, to exchange a specific amount of a currency on a specific

date at a specific rate.

 Currency option

22. ________ is a contract requiring exchange of a specific amount of currency on a specific

date at a specific exchange rate with all of these conditions fixed and not adjustable.
  Currency Futures contract

1. The mode of payment in which a bank acts as an intermediary without accepting financial risk
is called ____.

=> documentary collection

2. A document ordering an importer to pay an exporter a specified sum of money at a specified

time is called a (an) ____.

=> bill of exchange (draft)

3. The mode of payment in which the importer's bank issues a document stating that the bank will
pay the exporter when the exporter fulfills the terms of the document is called a (an) ____.

=> letter of credit

4. A contract between the exporter and carrier that specifies destination and shipping costs of the
merchandise is called a (an) ____.

=> bill of lading

5. The mode of payment in which an exporter ships merchandise and later bills the importer for
its value is called ____.

=> open account

6. The mode of payment in which an importer pays an exporter for merchandise before it is
shipped is called ____.

=> advance payment

7. ______ is a letter of credit calling for renewed credit to be made available when the issuing
bank informs the beneficiary that the buyer has reimbursed the issuing bank for the drafts already
drawn.

=> revolving letter of credit

8. ______ means two letters of credit with identical documentary requirements, except for the
difference in the price as shown by the invoice and draft.

=> back to back letter of credit

9. ______ is a letter of credit that can be drawn against, but only if another business transaction is
not performed.

=> standby letter of credit

10. ______ is a letter of credit issued by a bank and forwarded to the beneficiary by a second
bank in his area. The second bank validates the signatures and attests to the legitimacy of the
first bank.

=> advised letter of credit

11. ______ is a letter of credit issued by one bank to which a second bank adds its commitment
to pay.

=> confirmed letter of credit

12. ______ is a letter of credit that may be canceled at any moment without prior notice to the
beneficiary.

=> revocable letter of credit

13. ______ is a letter of credit that cannot be canceled nor amended without agreement of all
parties.

=> irrevocable letter of credit

14. ______ is a letter of credit under which the documents are forwarded to the importer's bank,
while sight draft is presented at a later future date.

=> deferred letter of credit

15. ______ is a letter of credit permitting the beneficiary to receive a sum prior to shipment.

=> red clause letter of credit

16. ______ is a letter of credit that can be utilized by someone designated by the original
beneficiary.

=> transferable letter of credit

1. _______ is the attempt to destroy unwholesome demand for products that are considered
undesirable, e.g. cigarettes, drugs, handguns, or extremist political parties.

 countermarketing

2. _______ is the difficult task of reversing negative demand, e.g., for dental work or hiring
disabled people.

 Conversional marketing

3. _______ is necessary where there’s no demand, which often happens with new products
and services.
=> stimulation marketing
5. _______ involves developing a product or service for which there is clearly a talent
demand, e.g., a non-polluting and fuel-efficient car.

 Developmental marketing

6. _______ involves altering the times pattern of irregular demand, e.g., for public transport
between rush hours, or for ski resorts in the summer.
=> sychromarketing
7. _______ involves revitalizing falling demand, for example, for churches, inner city areas,
or aging film stars.
=> remarketing
8. _______ is the attempt (by governments rather than private businesses) to reduce overall
demand, permanently or temporarily, e.g., for some roads and bridges during rush hours.
=> demarketing
9. _______ is a matter of retaining a current (may be full) level of demand, in the face of
competition or changing tastes.
=> maintenance marketing

1. A business and industry which acts as a third party local representative and
distribution point for a manufacturing firm.
 distributor
2. _____ is the systematic and coordianted set of activites required to provide the physical
movement and storage of goods (raw materials, parts, finished goods) from
vendor/supply services through company facilities to the customer (market) and the
associated activities - packaging, order processing, etc. in an efficient manner necessary
to enable the organization to contribute to the explicit goals of the company.
 Business logistics
3. An organization which provides logistics services as an intermediary between the
shipper and the carrier, typically on international shipments.
 Freight forwarder
4. ______ is that part of supply chain management that plans, implements, and controls
the efficient, effective forward and reverse flow and storage of goods, services, and
related information between the point of origin and the point of consumption in order
to meet customers' requirements.
 Logistics management
5. ______ is an independent computer systems, owned by independent organizations,
linked in a manner to allow direct updates to be made to one system by another
 Linked distributed system
6. ______ is a term describing the process whereby machines are remotely monitored for
status and problems reported and resolved automatically or maintenance scheduled by the
monitoring systems
 Machine to machine interface
7. ______ is a comprehensive, system-wide view of the entire supply chain as a single
process, from raw materials supply through finished goods distribution. All functions
 that make up the supply chain are managed as a single entity, rather than managing
individual functions separately
 Integrated logistics
8. The network of supply chain participants engaged in storage, handling, transfer,
transportation, and communication functions that contribute to the efficient flow of
goods.
 Logistics channel
9. ______ is a computerized system to electronically transmit logistics information
 Logistics data interchange
10. It encompasses the planning and management of all activities involved in sourcing and
procurement, conversion, and all logistics management activities
 Supply chain management
11. It is the process of planning, implementing and controlling the flow and storage of
goods, which aims at ensuring that the right product will be in the right place at the
right time in the most cost efficient way based on customers' needs
 logistics
12. One or more companies or individuals who participate in the flow of goods and
services from the manufacture to the final user or consumer
 Distribution channel
13. ______ is the total time that elapses between an order's placement and its receipt. It
includes the time required for order transmittal, order processing, order preparation, and
transmit
 Lead time
14. A ______ is a warehouse positioned to replenish customer inventory assortments and
to afford maximum inbound transport consolidation economies from inventory origin
points with relatively short-hand local delivery
 Market-positioned warehouse
15. ______ is a service unique to international trade and relates to an individual or firm that
specializes in one or more of the activites preceding Main Carriage, such
consolidation, packing, marking, sorting of merchandise, inspection, storage, etc..
 Marshaller or marshalling agent
16. ______ is the planning, directing, monitoring, and controlling of the processes related to
customer orders, manufacturing orders, and purchase orders.
 Order management
17. ______ is a transportation network that automatically routes one or more material
handling devices, such as carts or pallet trucks, and positions them at predetermined
destinations without operator intervention.
 Automated guided vehicle system (AGVS)
18. ______ is a transportation document that is the contract of carriage containing the
terms and conditions between the shipper and carrier.
 Bill of lading
 19. ______ is transportation available to the public that does not provide special treatment
to any one party and is regulated as to the rates charged, the liability assumed, and the
service provided.
 Common carrier
20. ______ is the process related to the storage and movement of the final product and the
related information flows from the end of the production line to the end user
 Outbound logistics
21. ______ is the process of moving products from end-user back to the origin to recover
value or for proper disposal
 Reverse logistics
22. ______ is the flow, or management, of goods into a production unit or warehouse.
 Inbound logistics

1. The company will ______ the policy holder against loss of or damage to the insured vehicle.
=> indemnify
2. Ships’ cargoes are covered by ___________ insurance policies.
=> marine insurance
3. A flexible type of insurance, for 12 months, at agreed rates, is ________
=> open cover
4. The most complete insurance is against _________
=> all risks
5. __________ is a standard form contract between the insured and the insurer, which determines
the claims that the insurer is legally required to pay.
=> insurance policy
6.__________ is payments to the insurance company to buy a policy and to keep it in force.
=> premium
7. __________ is the losses/ damages caused by special expenses and sacrifices that intentionally
and reasonably conducted to save the vessel, cargo and freight from a threat in the common ocean
voyage.
=> general average
8. The party to an insurance arrangement who undertakes to indemnity for losses is the
__________
=> insurer/underwriter
9. __________ is the person or entity buying the insurance and receiving indemnity on happening
of unforeseen events.
=> the insured/policyholder
10. The person, group, or property for which an insurance policy is issued is __________
=> the subject matter insured
11. __________ is a contract whereby, in return for the payment of premium by the
insured, the insurers pay the financial losses suffered by the insured as a result of the
occurrence of unforeseen events.
=> insurance
12. A contract of __________ is an agreement whereby the insurer undertakes to
indemnify the assured in a manner and to the extent thereby agreed, against losses, that
is, the losses incidental to marine adventure.
=> marine insurance