1: Basic Concepts
Subcontracting a stage of production (or other business processes such as customer service) to an outside party
outsourcing
Linguistic, organization, and social elements are all elements businesses study to understaind other countries' __.
culture
Organization that succeeded GATT and was founded to further reduce international trade barriers.
World Trade Organization
When a currency’s value increases in terms of another currency.
appreciation
The economic system of exchanging goods and services conducted between individuals and businesses in multiple countries.
international trade
Japan
A transaction that combines one company with another to form a single, larger new company.
merger
A commercial bank which provides business customers with banking services across many different countries is an examle of globalization of
markets
What are Geert Hoffstede's Intercultural Dimensions (there are 6!)
Power Distance
Individualism/Collectivism
Uncertainty Avoidance
Long Term Orientation
Indulgence v Restraint
When a foreign direct investment displaces local jobs this is a
Con for the host country
A small clothing designer who pays a factory abroad to sew its clothes and a car company that has its parts assembled in a factory in another country is an example of globalization of
production
What type of risks do businesses assess for ahead of global expansion and investment? (3)
Ownership Risks
Operating Risks
Transfer Risks
In 2014, The US imported items with a value of $1 trillion, and exported items with a value of $1.5 trillion. This is an example of
Trade Surplus
Where countries devalued their currencies in the effort to be more competitive with other countries in selling exports but only provoked other countries to do the same, which lead to global economic instability
competitive devaluation
Which of these facts is a globlization driver?
a. environmental regulations
b. organized labor unions
c. increased trade duties
d. technological innovations
d. technological innovations
a. corn
b.steel
c. petroleum
d. software
d. software, trying to content connect with a new audience in a way that they're most familiar would be possible with flexibel software
A company would be most likely to use a joint venture as a form of a foregin direct investment in an attempt to
a. create a partnership with a company in the host country
b. avoid restrictice trade barriers in the home country
c. acquire another company in the host country
d. reduce the size of its workforce in the home country
a. create a partnership with a company in the host country
Which groups most likely benefits a government raising tariffs in apraticular industry?
a. importers
b. domestic manufacturers
c. consumers
domestic manufacturers
Which best explains why a computer company might use a penetration pricing strategy?
a. to secure market status for the model as a luxury car
b. to make a short-term profit on the model
c. to recoup investment costs quickly to the model
d. to attract many customers to the model
d. to attract many customers to the model