What is the basic theory behind the reinforcement model?
What will be an ideal response?
Question 2Which of the following explains why per-capita GDP converted at market exchange rates inaccurately depicts the potential of an emerging market?
A) The market exchange rate does not take into consideration distribution and production costs for each nation.
B) Products and services in emerging markets are priced significantly lower than they are in advanced economies.
C) The per-capita GDP converted using PPP exchange rates provides a precise measure of consumer buying potential.
D) Products manufactured in emerging markets are priced less than products that are imported outside of an economic bloc.
Question 3Purchasing power parity tells us ________.
A) what a unit of local currency can buy in its home country
B) the value of goods and services that can be purchased with one unit of a country's currency
C) the relative ability of two countries' currencies to buy the same basket of goods in those two countries
D) what a currency can actually buy in real terms
Question 4Computer software counterfeiting in an emerging market can have what negative effect?
A) withdrawal of MNEs
B) political instability
C) lack of transparency
D) discourage investment
Question 5In purchasing power parity terms, which nation has the highest per-capita GDP?
A) Brazil
B) China
C) Turkey
D) South Korea
Question 6The WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) permits developing countries to import generic products from other countries if they don't have the capacity to produce generic drugs.
Indicate whether the statement is true or false
Question 7Which of the following will most likely be the result of an increased number of middle-class households in emerging markets?
A) a vital market economy
B) a decrease in GDP
C) urbanization decline
D) multi-income families
Question 8Over the next two decades, which of the following is most likely to happen to middle class households in emerging markets?
A) Their numbers will decrease.
B) They will acquire enormous spending power.
C) Their numbers will stay approximately the same.
D) Their incomes will decrease.