Trade barriers
This trade barrier limits the quantity of goods that can enter a country.
What is a quota?
This occurs when a country exports more than it imports.
What is a trade surplus?
This U.S. institution is the official export credit agency of the United States.
What is the Export-Import Bank (Ex-Im Bank)?
These rights protect creations of the mind.
What are intellectual property rights?
A developing country lowers taxes for foreign companies, creates special trade zones near ports, and offers government funding to manufacturers.
What is the MOST likely goal of these actions?
What is promoting international trade and attracting foreign investment?
This type of trade barrier places taxes on imported goods
What are tariffs?
This concept compares the purchasing power of currencies between countries.
What is Purchasing Power Parity (PPP)?
This type of loan covers the exporter, although coverage may be less than the value of the contract.
What is supplier’s credit?
These specifically protect signs, symbols, and trademarks distinguishing products and services.
What are industrial property rights?
A company manufactures phones overseas. Suddenly, political violence erupts near factories, supply chains shut down, and employees cannot safely work.
What category of international business risk is MOST directly affecting the company?
What is operation risk?
This trade restriction completely blocks trade with a country or group.
What is an embargo?
The “Whopper Index” or “Big Mac Index” are examples used to explain this concept.
What is PPP?
This government-created program established in 1934 helps reduce costs associated with international trade.
What are Foreign Trade Zones (FTZs)?
This agreement protects authors of literary and artistic works internationally.
What is the Berne Convention?
A business operates successfully in another country for years, but a scandal involving labor exploitation spreads online and damages the company’s public image worldwide. Sales rapidly decline.
What source of risk is MOST responsible for the losses?
What is reputation risk?
These slow down imported goods through excessive paperwork and inspections.
What are administrative delays?
This U.S. government organization helps stimulate economic opportunities for U.S. businesses abroad.
What is the International Trade Administration (ITA)?
These designated customs areas allow merchandise to receive treatment as if it were outside U.S. commerce.
What are Foreign Trade Zones?
A musician writes a song in the United States and wants protection if it is copied in another country that signed the same international agreement.
What agreement protects them?
What is the Berne Convention?
A company is comparing two countries before expanding internationally:
From an international business perspective, why might Country B actually be the SAFER long-term investment?
What is because lower political, legal, and operational risks can make a market more stable and predictable despite lower GDP?
A country raises taxes on imported steel, causing imported steel prices to rise while consumers begin buying locally produced steel instead.
What trade barrier was MOST likely used?
What are tariffs?
A business is selling products overseas and must wait longer to receive payment from buyers. This increases financial risk and requires extra evaluation of buyer reliability.
What process is being described?
What is export financing?
A small business wants government-backed assistance exporting products overseas without meeting a high minimum transaction requirement.
Which organization would BEST help them?
What is the Export-Import Bank (Ex-Im Bank)?
A company copies another company’s logo and branding to confuse customers into buying their products.
Which type of intellectual property protection was violated?
What are trademark/industrial property rights?
A U.S. technology company expands into a rapidly growing foreign market because the country has low labor costs and a very high GDP growth rate.
Within three years:
Using international business concepts, identify TWO government trade restrictions and TWO international business risks the company is experiencing.
Government Trade Restrictions:
International Business Risks: