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WGU Global-Economics-for-Managers Exam Syllabus Topics:

Section	Weight	Objectives
Topic 1: Foundations of Global Economics	20%	- Views on Globalization 1. Drivers and consequences of globalization 2. New view, Evolutionary view, Pendulum view - Economic Systems and Institutions 1. Political, legal, and cultural frameworks 2. Market, command, and mixed economies
Topic 2: Macroeconomics for Managers	10%	- Economic Indicators and Policies 1. Fiscal and monetary policy impacts 2. GDP, inflation, unemployment, business cycles
Topic 3: Foreign Direct Investment and Global Strategy	20%	- Global Business Strategy 1. Strategic positions: Defender, Extender, Contender, Dodger 2. Porter's Diamond model - Foreign Direct Investment (FDI) 1. Location advantages and entry modes 2. Theories of FDI, costs and benefits
Topic 4: International Trade Theory and Policy	25%	- Classical and Modern Trade Theories 1. Absolute advantage, Comparative advantage 2. Heckscher-Ohlin, Product life-cycle, Strategic trade theory - Trade Policies and Barriers 1. Tariffs, quotas, subsidies, embargoes 2. Economic integration: EU, USMCA, ASEAN
Topic 5: Global Finance and Monetary Systems	25%	- Foreign Exchange Markets 1. Exchange rate determination, currency regimes 2. Hedging and risk management - Balance of Payments and International Monetary System 1. Fixed vs floating exchange rates, IMF, World Bank 2. Current account, capital account, official reserves

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WGU Global Economics for Managers (C211, UZC2) Sample Questions (Q116-Q121):

NEW QUESTION # 116
What is true about tariffs?

A. They allow the government to raise revenue
B. They eliminate deadweight loss
C. They lower domestic prices below world prices
D. They increase consumer surplus

Answer: A

Explanation:
InGlobal Economics for Managers, tariffs are recognized as a policy tool thatallows governments to raise revenue, making option C correct.
Tariffs generate revenue by taxing imported goods. While domestic producers may benefit and governments gain revenue, consumers lose due to higher prices and reduced choices. Tariffs also create deadweight loss, reducing overall economic efficiency.
Options A, B, and D contradict standard trade theory.
Therefore, option C is correct.

NEW QUESTION # 117
Costs that do not vary with output quantity divided by the quantity of output is best described by which term?

A. Average variable cost
B. Average fixed cost
C. Total cost
D. Marginal cost

Answer: B

Explanation:
Average fixed cost is calculated by dividing fixed costs by the quantity of output. Fixed costs are costs that do not change with production volume in the short run, such as rent, certain license fees, salaried administrative expenses, or fixed internet service costs. Option D is correct because the question specifically says "costs that do not vary with output quantity," which identifies fixed costs, and then says those costs are divided by quantity. Total cost equals fixed cost plus variable cost. Marginal cost is the additional cost of producing one more unit. Average variable cost divides variable costs by output. Average fixed cost usually declines as output increases because the same fixed cost is spread across more units. This is why higher production can reduce per-unit fixed cost.

NEW QUESTION # 118
The benefit attributed to firms that enter a market before other firms in the same market segment is best described by which term?

A. Economies of scope
B. Competitive neutrality
C. First-mover advantage
D. Late-mover advantage

Answer: C

Explanation:
InGlobal Economics for Managers, the benefit enjoyed by firms that enter a marketbefore competitorsis known asfirst-mover advantage, making option C correct. First movers are firms that are pioneers in introducing new products, technologies, or business models into a market.
First-mover advantages can arise from several sources. Early entrants may be able to buildbrand recognition, securecontrol over scarce resources, establishcustomer loyalty, or setindustry standardsthat later entrants must follow. In some cases, first movers can erect significant barriers to entry, making it difficult for competitors to gain market share.
However,Global Economics for Managersalso notes that first-mover advantages are not guaranteed. Early entrants face higher uncertainty, development costs, and the risk of technological obsolescence. Nevertheless, when successful, first movers can sustain long-term competitive advantages.
Option A refers to late-mover advantage, which arises from reduced uncertainty. Option B is not a standard strategic concept. Option D relates to cost efficiencies across products, not timing of entry.
Thus, option C correctly identifies first-mover advantage.

NEW QUESTION # 119
Which statements concerning property rights are true? (Choose TWO.)

A. The primary purpose of establishing property rights is to provide economic benefit to society as a whole.
B. Developing countries can achieve economic growth even without securing property rights.
C. Property rights are the legal rights regarding the use of an economic resource and for deriving income and benefits from it.
D. Securing property rights results in industries that employ little fixed capital and avoid long-term investment.
E. Insecure property rights bode well in global competition where firms benefit from economies of scale and sustained R&D.
F. Protection of property rights is commonly recognized as a major factor in allowing developing countries to make gains toward economic progress.

Answer: C,F

Explanation:
InGlobal Economics for Managers, property rights are fundamental to economic development and global competitiveness, making optionsC and Fthe correct answers.
Option F correctly definesproperty rightsas the legal rights governing the use of an economic resource and the ability to derive income and benefits from it. These rights specify ownership, control, transferability, and enforcement, providing clarity and predictability for economic actors.
Option C is also correct becauseprotection of property rights is widely recognized as a key driver of economic progress, especially in developing countries. Secure property rights encourage investment, innovation, and long-term planning by reducing the risk of expropriation or misuse. Firms are more willing to invest in capital-intensive production and research and development when their assets and returns are legally protected.
Option A is incorrect because secure property rights encourage-not discourage-long-term investment and capital-intensive industries. Option B is incorrect because insecure property rights undermine economies of scale and R&D by increasing uncertainty. Option D contradicts extensive evidence showing that weak property rights constrain sustainable growth. Option E is partially normative but not emphasized as a core analytical statement in managerial economics texts.
Thus, options C and F accurately reflect the role and definition of property rights in global economics.

NEW QUESTION # 120
What is the bandwagon effect?

A. The movement of investors in the same direction at the same time
B. Government intervention to stabilize markets
C. The tendency of prices to return to equilibrium
D. Investors moving independently based on private information

Answer: A

Explanation:
In Global Economics for Managers, the bandwagon effect refers to the movement of investors in the same direction at the same time, making option B correct. This phenomenon occurs when individuals follow the actions of others rather than relying solely on their own information or analysis.
The bandwagon effect is common in financial markets, particularly during asset bubbles or currency crises.
As more investors buy or sell an asset, others follow, reinforcing the trend regardless of underlying fundamentals. This herd behavior can amplify volatility and lead to mispricing.
Options A, C, and D do not describe collective investor behavior.
Thus, option B correctly defines the bandwagon effect.

NEW QUESTION # 121
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