International Business Basics
what is importing
items bought from other countries
what are trade barrieeres
restrictions to free trade
what are multinational companies (MNC)
An organization that does business in several countries,
What are ways to encourage international trade?
Free trade zones, free-trade agreements, and common markets
What is Foreign Exchange Market?
Banks that buy and sell different currencies.
what are exports
Goods and services sold to other countries
types of international barriers
quotas, tariffs, embargoes
What are the global market entry modes?
Licensing
Franchising
Joint Venture
What is a free trade zone?
A selected area where products can be imported duty-free and then stored, assembled, and/or used in manufacturing.
What are interest rates?
The cost of using someone else's money.
what is the difference between absolute and comparative advantage
absolute advantage is when a country can produce a good or service at a lower cost than other countries. Comparative advantage is a situation in which a country specializes in the production of a good or service at which it is relatively more efficient
what are tariffs ?
a tax that a government places on certain imported products
What are types of Global Market methods?
Licensing, Franchising, and Join ventures.
What is a free-trade agreement?
When member countries agree to remove duties and trade barries on products traded among them.
What factors affect currency values?
Balance of payments, economic conditions, and political stability.
the difference of trade surplus and trade deficit
if you sells (exports) more than it buys (imports) it is an trade surplus, if it imports more than it exports it is an trade deficit
What are quotas?
A limit on the quantity of a product that may be imported or exported within a giver time period.
What are some disadvantages of multinational companies in the host country?
Workers become dependent, the company can become major economic powers, consumers may become dependent on the product, and the political power of the country may be influenced.
What is a common market?
What is in exchange rate?
The value of a currency in one country compared with the value in another.
What are the Factors affecting Currency Values
Balance of Payments
Economic Condition
Political stability
What is an embargo?
When the government completely stops the export or import of a product.
Consumers have a large amount of goods available, goods are often at lower prices, more job opportunities, and establishes friendly relation with other countries.
What are some examples of common markets?
European Union (EU) and the Latin American Integration Association (LAIA)
True or False: Each nation has its own banking system and money?
True