In Terms of Free Trade,all of the Following Are Correct,except

question 16

Multiple Choice

In terms of free trade,all of the following are correct,except:

• A)Free-trade areas create an opportunity for manufacturing organizations because it lets them reduce their costs.
• B)It facilitates organizations wishing to serve the whole region from one location rather than establishing separate operations in each country.
• C)Some managers view regional free-trade agreements as a threat because they expose a company based in one-member country to increased competition from companies based in the other member countries.
• D)Organizations can reduce costs by shifting production to the lowest-cost location within the free-trade area
• E)Free trade is generally recognized around the world as being protectionist.

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Definitions:

Compounded Annually

A method of calculating interest where the interest amount is added to the principal sum at the end of each year, affecting the total interest for the next year.

Interest on Interest

The compound interest that is calculated not only on the initial principal but also on the accumulated interest of previous periods.

Time Value

The principle that current money has a higher value than the same amount would in the future, given its potential to earn more.

Money

A medium of exchange that is widely accepted in transactions for goods and services, acting as a unit of account, a store of value, and sometimes, a standard of deferred payment.