1. A company is fighting a legal case in a country where a judge investigates the facts and juries are rarely used. Which legal system is being used?
A. Civil Correct
B. Canon
C. Customary
D. Common
Explanation
Civil law systems, rooted in Roman law and comprehensive codes like the Napoleonic Code, feature inquisitorial proceedings where judges proactively gather evidence, examine witnesses, and establish facts, typically without juries in civil or commercial cases, as practiced in France, Germany, Italy, and most of Latin America. Canon law is limited to Catholic Church internal governance and religious doctrine. Customary law depends on oral traditions and community norms in tribal societies, lacking formal judicial structures. Common law, originating in England and adopted in the US, UK, and Commonwealth nations, is adversarial, with attorneys presenting evidence to a neutral judge and often a jury determining facts.
2. Which challenge might a multinational corporation face as it expands to different countries due to increased globalization?
A. Consistent global infrastructure
B. Increased ethical considerations Correct
C. Technologically ready workforce
D. Simplified organizational structure
Explanation
Globalization intensifies ethical scrutiny as MNCs encounter divergent norms on bribery (e.g., varying Corruption Perceptions Index scores), labor practices (ILO standards vs. local child labor tolerance), environmental responsibility, and supply chain human rights, risking reputational damage or legal penalties under laws like the UK Bribery Act. Infrastructure consistency is unattainable due to developmental gaps. Workforce tech readiness is a human capital challenge. Structures complexify with global subsidiaries and compliance layers.
3. What is one purpose of the World Bank?
A. To establish networks for sharing financial information
B. To assist with building infrastructure
C. To supply technical expertise for development
D. To provide loans to developing countries Correct
Explanation
The World Bank Group, comprising IBRD and IDA, primarily disburses long-term loans, zero-interest credits, and grants to low- and middle-income countries for capital-intensive projects targeting poverty reduction, education, health, and economic growth. Infrastructure and expertise are delivered through funded initiatives, not core purposes. Financial networks align with IMF or BIS functions.
4. Which International organization is criticized for having an imbalance in the voting power of various countries?
A. World Trade Organization
B. United Nations
C. International Monetary Fund Correct
D. World Bank
Explanation
IMF voting shares are quota-based, reflecting historical economic contributions, granting the US veto power (over 16% votes) and disproportionate influence to G7 nations, criticized by emerging markets like China and India for underrepresentation despite rapid growth. WTO operates on consensus. UN General Assembly is egalitarian. World Bank weighted voting faces less intense backlash.
5. Why does the World Bank have a AAA bond rating?
A. Its loans to developing countries are made at high interest rates.
B. Its debt is backed by member countries. Correct
C. It uses a standardized assessment of countries seeking a loan.
D. It consistently avoids lending to high-risk countries.
Explanation
AAA ratings stem from callable capital subscriptions where member states, particularly high-credit ones, commit to additional payments if needed to cover defaults, providing near-sovereign security despite lending to risky borrowers. IDA loans are interest-free; IBRD below-market. Risk assessments inform projects but not rating. High-risk lending is intentional for development.