Firms Internationalize Through Two Mechanisms

question 32

Multiple Choice

Firms internationalize through two mechanisms:

• A)Exports and imports
• B)Trade in goods (visible trade)and trade in services (invisible trade)
• C)Direct and indirect investment
• D)Trade and direct investment.

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Definitions:

Quantity Demanded

The sum total of a particular good or service that consumers are inclined and financially equipped to acquire at a determined price range within a given period.

Quantity Supplied

The volume of a commodity or service that producers are prepared and able to supply at a specified price within a certain timeframe.

Equilibrium Price

The price point at which the supply of an item matches the demand for it, resulting in a stable market situation without excess or shortage.

Equilibrium Quantity

The quantity of a good or service at which supply equals demand, resulting in no net surplus or shortage in the market.