Question

is independent, the government protects peronal politicl nore partics can govern (as a coalition or separnetelye The it, and free elections ta If three or c) Cirizens have the legal right to make all docisions 12 A distributive political risk is characterized by the following statement is Government interferes with business transactions b) Government change public policies and such changes always reduce profits. c) potem want to claim a larger share of revenues gomerated by foreip d) Constrains flexibility of local operations. 13 There are different types of economic systems. When people make most of t economic decisions and the law of supply and demand dictate prices, it is said tur the economy is a: a) Market Economy b) Command Economy. c) Mixed Economy d) Traditional ecomomy. 14 The GNI provides the broadest measure of ecenomic performance becane a) It measures the value of all production in the domestic economy md the income that the country receives from other countries (is interest, and dividends), pius the same sorts of payments that b) It measures the value of all production of goods and services and capital within a country's borders16 tr truest m received from other countries. nation that the nation received from other nations, less the sane economic activity. It is the GDP phes the income generatod S , e) It is the total valuc of all final goods and services prodacod wit h d) It measures the value of all production in the domestic has made to other countries 15 Economic freedom: (Select all that apply) a) Holds that one has the right to work limited in that investment might be costrolled by the b) Holds that one has the right to work, prodace c) For a complete Economic freedses so be d) Measures the absence of governmnto way one prefers goods and se distribution, or consumption of

Answer 1

12

c) Governments want to claim a larger share of revenues generated by foreign companies.

MNCs need to deal with distributive political risk whenever they set up their operation in a foreign country. The government may want more share of their profit through tax and regulations.

13

a) Market economy

Market economy is represented by no regulation and complete autonomy to supply and demand in the market.

14

d) It measures the value of all production in the domestic….

15

b) Holds that one has the right to work produce….

c) For a complete economic freedom to be achieve the government has to be “absent”

P.S. the text on number 14 is not very clear in the picture. However GNI refers to the production that done domestically and also the income generated by national companies in the foreign country. However, if it (the companies) borrows money in the foreign country it will need to pay interest to the foreign country. So we need to subtract that from the income.