Term
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Definition
| Is an organization with multi-country affiliates, each of which formulates its own business strategy based on perceived market differences |
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Term
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Definition
| The external forces that influence the life and development of the firm. |
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Term
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Definition
| Management decisions that help adapt the firm to uncontrollable forces. |
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Term
| Foreign Direct Investments (FDIs) |
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Definition
| refers to direct investments in equipment, structures, and organizations in a foreign country at a level to where you gain significant management control. |
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Term
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Definition
| is the transportation of any domestic good or service to a destination outside a country or region. |
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Term
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Definition
| The transportation of any good or service into a country or region from a foreign origination point. |
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Term
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Definition
| The tendency towards an international integration of good, technology, information, labor and capital. |
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Term
| What is different about International Business? |
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Definition
-Firms operating across borders must deal with the forces of three kinds of environments- domestic, foreign, and international.
Domestic Environment - all uncontrollable forces that originate from the home country of the firm.
Foreign Environment- Any uncontrollable forces that originate from outside the firms home country.
International Environment - Interactions between the domestic environmental forces and the foreign environmental forces. |
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Term
| What are the 5 drivers of Globalization? |
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Definition
Political - Trends towards unification and globalization and socialization of the global community.
Technological - Advances in computers and communications increase flow of info and ideas across borders.
Market - as companies globalize, they also become global customers.
Cost - Economies of scale to reduce unit costs are a common management goal.
Competitive - To protect their countries economy, and new firms industrialize in other countries. |
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Term
| Arguments supporting and against globalization? |
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Definition
Supporting - Free trade enhances socioeconomic development and Promotes more and better jobs.
Against - There will be uneven results across nations and people, Delirious affects on labor and labor standards, and environmental and health concerns. |
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Term
| Motives for entering a foreign market? |
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Definition
Increasing profits and sales - Entering new markets, Create new markets, Faster growing markets, greater profits and revenue, and lower cost of goods sold.
Protecting markets, profits, and sales - attacking a competitor's home market, and using foreign production to lower costs, and expansion. |
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Term
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Definition
| the ability of a firm or country to carry out a particular economic activity more efficiently than another firm or country. |
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Definition
| The ability of a firm or country to product a particular good or service at a lower marginal and opportunity cost. |
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Term
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Definition
| A nations ability to design produce distribute, or service products within an international trading context while earning increasing returns on its resources. |
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Term
| Top nations of Imports and Exports |
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Definition
Imports: !. U.S. $1,604 B 2. China $1,006 B 3. Germany $931 B 4. France $551 B 5. Japan $551 B
Exports - 1. China $1,194 B 2. Germany $1,121 B 3. U.S. $995 B 4. Japan $516 B 5. France $457 |
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Term
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Definition
| The direction of trade changes over time amount nations of the world. Development of trade agreements alter trade flows in many regions. |
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| U.S. Top Trading Partners |
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Definition
U.S. Exports - 1. Canada $205 B 2. Mexico $129 B 3. China $70 B 4. Japan $51 B 5. UK $46 B
U.S. Imports - 1. China $296 B 2. Canada $225 B 3. Mexico $117 B 4. Japan $96 B 5. Germany $71 B |
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Term
| Annual Outflows and Inflows of FDI |
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Definition
- The annual outflows are the amount invested each year into other nations.
- The annual inflows are the amount received from foreign investors. |
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Term
| Trade and investment impact on economic and social development |
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Definition
| It has an effect on employment levels, economic growth, development, and an improvement in the overall human condition which directly impacts economic and social factors. |
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Term
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Definition
| An area where tariffs and are abolished among members, but each member-nation maintains its own external tariffs. |
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Term
| TRIPS (Trade-related intellectual property rights) |
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Definition
| The right to own your own mind's creation by patenting or copyrighting your idea. |
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Term
| Why are Institutions important |
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Definition
- They provide stability and meaning to social life.
- In the business world, institutions are an collective set of basic rules and unwritten codes of conduct that direct the decisions of a firms through laws and regulations. |
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Term
| What does the UN do for international business? |
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Definition
- UN agreements set technical standards for norms
- They prepare the ground for investment in emerging economies by focusing on political stability and development.
- Address the downsides of globalization
- Seek solutions to global environmental issues. |
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Term
| International Monetary and World Bank |
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Definition
- The international monetary fund establishes riles for international monetary policies and their enforcement.
- The world bank lends money for development projects. |
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Term
| What is the WTO and what is its purpose? |
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Definition
| The World Trade Organization: is the only global international organization designed to establish and help implement rule of trade between nations. |
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Term
| What is NAFTA and what are the basics of the EU? |
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Definition
North American Free Trade Agreement: created a free trade area among Canada, Mexico, and the U.S.
- The UN deals with three integrations: the economic community, foreign policy, and domestic affairs. |
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Term
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Definition
| it is the combination of social and cultural, because these are very interrelated. |
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Term
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Definition
| When an individual views his own society superior to all others. |
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Term
| Cultural Effects on business functions? |
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Definition
| Marketing, Human resources, Production, Accounting, Finance, and Preferred leadership style. |
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Term
| The 5 Cultural Dimensions |
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Definition
Individual-Collectivism: measures the degree to which people in the culture are integrated into groups.
Power Distance: is the extent to which members of a society expect and accept power to be distributed unequally.
Uncertainty Avoidance: A society's comfort with uncertainty
Masculinity - Femininity: the distribution of roles between genders.
Long-Term Orientation/Confucian Dynamism: dealing with virtue regardless of truth, or the level in which people in the culture will persevere to overcome obstacles they cannot overcome with strength or will. |
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Term
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Definition
| it is the part of the waterway that provides inexpensive access to interior markets. This allows people to ship goods on a boat to almost every country. |
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Term
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Definition
| It is Europe's inland waterway system that is important to their economic system. |
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Term
| Nonrenewable energy sources |
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Definition
| fossil fuels, such as petroleum, coal, and natural gas. Once they are used, the supplies are depleted. |
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Term
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Definition
| Calls for nations to work together to reduce global warming by reducing their emissions of the gas that contributes to it. |
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Term
| Environmental Sustainability |
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Definition
| this is the ability of the environment to provide resources to survive. Businesses are supposed to operate without reducing the capacity of the environment to provide for future generations. |
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Term
| Top Oil Producing Countries |
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Definition
1. Saudi Arabia
2. Canada
3. Iran
4. Iraq
5. Kuwait
6. United Arab Emirates
7. Venezuela
8. Russia
9. Libya
10. Nigeria
11. Kazakhstan
12. United States
13. China
14. Qatar |
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Term
| World Situation on Petroleum, Nuclear Power, and Coal? |
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Definition
Petroleum: it has been a cheap source of raw energy. The earth is running out of oil and this has caused the oil prices to rise. The world has a huge dependency on oil.
Nuclear Power: Nuclear Power plants have problems with waste storage and have dangerous accidents, but they generate little pollution. The use of nuclear power has increased in recent years.
Coal: Coal use was expected to decline because of the pollution, it is now expected to increase slowly. |
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Term
| Characteristics of environmentally sustainable business |
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Definition
3 characteristics:
1. Limits: the recognition that environmental resources are exhaustible.
2. Interdependence: relationships among ecological, social, and economic systems where action in one system affect the others.
Equity: for interdependence to work, there can't be vast differences in the distribution of gains. |
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Term
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Definition
| The process of transferring ownership of a business, enterprise, or agency from the public sector (state or government) to the private sector. |
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Term
| Country risk assessment (CRA) |
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Definition
| An evaluation conducted by a bank or business, that assesses a country's economic situation and policies and its politics to determine how much risk exists of losing an investment. |
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Term
| Government stability and instability |
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Definition
Stability -the ability to maintain a governments power, or permanence of a governments policies.
Instability- When a government cannot maintain its power, or makes sudden or radical policy changes. |
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Term
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Definition
when a company sells a product abroad for less than:
The average cost of production in the exporting nation, the market price in the exporting nation or the price to a third country. |
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Term
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Definition
| Financial contributions, provided directly or indirectly by a government which confer a benefit, including grants, preferential tax treatment, and government assumption of normal business exceptions. |
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Term
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Definition
| Taxes levied on imported goods for the purpose of raising their selling price to reduce competition for local producers or stimulate local production, also known as import duties. |
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Term
| Non-tariff barriers (NTBs) |
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Definition
| All forms of discrimination against imports other than import duties |
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Term
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Definition
| Numerical limits placed on specific classes of imports |
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Term
| Why do businesses Nationalize or Privatize? |
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Definition
| Governments take control of firms to extract more money from the firm, to make money by running it more efficiently, and to preserve jobs in that country. |
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Term
| What is Government Protection? |
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Definition
| When a government protects economic activities such as farming, mining, and manufacturing within its area of control. |
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Term
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Definition
| They repeatedly make decisions about where to incest, where to conduct research and development, and where to manufacture products. They seek the best and cheapest countries to carry out these activities. |
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Term
| What are different types of trade restrictions? |
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Definition
National Defense: certain industries need protection from imports because they are vital to security and must be kept operating even though they are not competitive with foreign suppliers.
Sanctions to punish offending countries: inflict economic damage on other nations in order to punish them to modify behavior.
Protect Infant (or dying) Industry: in the long run the industry will have a comparative advantage but that firm needs protection from imports until the required investment capital is obtain, or the labor force is trained.
Protect domestic jobs from cheap foreign labor: compare lower foreign hourly wage rates to those paid in their home country.
Scientific Tariff or Fair Comparison: want an import duty that will bring the cost of the imported goods up to the cost of the domestically produced article.
Retaliation: representatives of an industry whose exports have had imported restrictions placed on them by another country may ask their government to retaliate with similar restrictions. |
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Term
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Definition
| Agreements between countries, which may be bilateral (between two countries) or multilateral (more than two countries) |
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Term
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Definition
| Patents, Trademarks, Trade names, copy rights, and trade secrets, all of which result from the exercise of someone's intellect. |
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Term
| Extraterritorial applications of laws |
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Definition
| A countries attempt to apply its laws to foreigners or nonresidents for acts and activities that take place outside its borders. |
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Term
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Definition
| Standard that holds a company and its officers and directors liable and possibly subject to fines or imprisonment when their product causes death, injury or damage. |
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Term
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Definition
| laws that prevent price fixing, market sharing, and business monopolies |
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Term
| What is international dispute settlement? |
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Definition
Litigation: when a different countries set of laws is used in a certain circumstance. A contract with a choice-of-law clause will specify what law will govern the dispute.
Performance Contracts: when two agreeing firms agree that their countries will govern their performance contract. When dealing with firms in different countries, many countries use the United Convention on the International Sale of Goods.
Arbitration: an inexpensive alternative to litigation, for the use of their own legal standards among member firms to settle disputes. |
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Term
| What are the different types of intellectual property? |
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Definition
Patents: this is a written document that gives you the title to your product idea for 15-20 years.
Trademarks: A symbol, word, or words that are legally registered to represent a company or product.
Trade Names: These are the names of businesses.
Copyrights: The exclusive legal right to print, publish, preform, film or record a certain thing. |
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Term
| Standardizing laws around the world? |
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Definition
| Many businesses want to standardize laws to make business flow better because of a uniform set of laws over boarders. |
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Term
| Foreign corrupt practices act? |
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Definition
| This is a U.S. law against making payments to foreign governments for special treatment. |
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