Multiple Choice QuestionAn Egyptian firm exporting cotton to the United States and an American company hiring an Indian call center to answer its phones are examples of which of the following?Multiple choice question.An international asset transactionInternational tradeAn international business planBalance of payments
Question
Multiple Choice QuestionAn Egyptian firm exporting cotton to the United States and an American company hiring an Indian call center to answer its phones are examples of which of the following?Multiple choice question.An international asset transactionInternational tradeAn international business planBalance of payments
Solution
The correct answer is "International trade".
Here's why:
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An Egyptian firm exporting cotton to the United States: This is a clear example of international trade as goods (in this case, cotton) are being exchanged between two countries.
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An American company hiring an Indian call center to answer its phones: This is also an example of international trade. In this case, it's not goods but services (call center services) that are being traded internationally.
The other options do not fit these scenarios. An international asset transaction typically refers to the sale or exchange of financial assets, like stocks or bonds, across borders. An international business plan is a strategy for expanding a business internationally, and balance of payments is a record of all transactions made between consumers, businesses and the government in one country with others.
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