Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Business Theme 3 and 4 > 4.1 > Flashcards

4.1 Flashcards

1
Q

Define GDP

A

The value of all the goods and services produced in a country

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Define emerging economy

A

An economy in the process of rapid growth and industrialization relatively low income per head (per capita)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What are some common features of remerging economies?

A

-Rapid industrialisation
-Have potential to become developed
-Struggle to access global markets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What are some perceived threats from emerging economies?

A

-Large pool of skilled, low cost labour
-Exports cheaper due to undervalued currencies

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What are some opportunities for emerging economies?

A

-Growing consumer spending
-Demand for infrastructure and other products & services
-Source of high skilled low cost labor
-Potential for acquisitions

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What are some risks from doing business in emerging economies?

A

-Political instability
-Corruption & bureaucracy still an issue
-Emerging markets becoming major exporters
-Variable approaches to finical & legal dealings

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Why are emerging economies enjoying high growth rates?

A

-Industrialization
-Population growth
-Workforce improve skills and more productive
-Technological innovation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What are the 2 key indicators of growth?

A
  1. GDP per capita
  2. Purchasing power parity
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

How to calculate GDP per capita?

A

GDP divided by the number of people in the country

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Define purchasing power parity

A

A measure of real growth that uses the price of a basket of goods and services to compare prices across countries

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What is Human Development Index?

A

Combination of statistics (literacy, health and GDP per capita into a single value) to help make comparisons of the people and their skills

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What are some benefits from international trade?

A

-Creation of jobs help reduce poverty
-Low prices for consumer due to competition
-Technology is spread raising productivity
-Knowledge and skills cross borders

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Drawbacks of international trade?

A

-Transport costs
-Negative externalities from production and consumption
-Structural unemployment
-Rising inequality

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Define Exports

A

A function of international trade whereby goods and services produced by one country are sold to another country.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Define imports

A

Goods and services brought into one country from another

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What is specialisation?

A

When a country produces goods or services that its best at.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Why does specialization make sense?

A

-Provides a competitive advantage
-Can produce wider range of closely linked goods.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Define Foreign Direct Investment (FDI)

A

Investment from one country into another rather than involves establishing operations of acquiring tangible assets including stakes in other businesses

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

What are the 2 main flows of FDI?

A

-Inward FDI (money coming into economy)
-Outward FDI (expanding overseas)

20
Q

Reasons why businesses engage in FDI?

A

-Take advantage of lower labour costs
-Operate closer to sources of raw materials
-Avoid protectionist measues
-Support strategy of market development

21
Q

Define globalisation

A

The geographic dispersion of industrial and service activities

22
Q

Characteristics of Globalisation

A

-Greater trade across borders
-Development of global brands
-Greater use of outsourcing

23
Q

What are some factors contributing to globalisation?

A

-Containerisation
-Technological change
-Economies of scale
-Difference in tax systems
-Less protectionism

24
Q

What are some benefits of globalisation?

A

-Benefit from deeper divisions & economies of scale
-Competitive markets reduce monopoly profits
-Higher per capita incomes
-sharing of ideas / skills / technologies

25
Q

What are the drawbacks of globalisation?

A

-Inequality
-Inflation
-Vulnerability to external economic shocks
-Unemployment
-Dominant global brands

26
Q

Define Protectionism

A

Any government attempt to impose restrictions on trade in goods and services to protect domestic businesses.

27
Q

Define Tariffs

A

A tax placed on imported goods from other countries. (increases price of good which shifts demand in favour of products from domestic firms)

28
Q

Define Import quotas

A

Government imposed limit on the amount of a product allowed into one country

29
Q

Define Subsidies

A

Payments given to domestic business to help lower costs of production.

30
Q

What are some arguments in favour or protectionism?

A

-Infant industry protection (helps start ups establish)
-Protect jobs, skills
-Protection against import dumping (stop predatory pricing)

31
Q

Arguments against protectionsim

A

-Higher prices for consumers
-Retaliation from other countries (price wars)
-Extra costs for exporters

32
Q

Define Trade blocs

A

Groups of countries that form an agreement to reduce or eliminate protectionist measures between each other.

33
Q

Benefits of trading blocs?

A

-FDI
-Economies of scale (larger markets created)
-Competition
-Greater trade
-Market efficiency

34
Q

Benefits of Tariffs

A

-Protects infant industries
-Increase in government tax revenues
-Reduces dumping

35
Q

Drawbacks of Tariffs

A

-Increases costs of imported raw materials
-Reduces competition and consumer choice

36
Q

Advantages of import quotas

A

-To meet extra demand domestic business may need to hire more workers which reduces unemployment
-High prices for products may encourage new start ups
-Countries can easily change import quotas as market conditions change.

37
Q

Disadvantages of import quotas

A

-Quotas limit supply so price of products rise
-Domestic firms may become inefficient over time as quotas reduce competition

38
Q

Advantage of subsidies

A

Reduced costs, means lower prices making domestic firms more competitive, helps protect jobs.

39
Q

Disadvantage of subsidies

A

Businesses may become inefficient as they know their costs are being subsidised.

40
Q

What is protectionist legislation

A

Government can impost legislation laws to restrict imports and protect customers and businesses

41
Q

Advantages of protectionist legislation

A

Allows domestic firms to grow due to limited competition

42
Q

Disadvantages of protectionist legislation

A

Can lead to retaliation from countries facing legislation

43
Q

Define Trade creation

A

Businesses are able to enter new markets leading to an increase in sales volume and revenue.

44
Q

What are the 3 largest trading blocs?

A

-EU
-ASEAN
-NAFTA

45
Q

Benefits of being in a trading bloc?

A

-Access to more markets
-External tariffs protect firms
-Infrastructure support
-Free movement of labour

46
Q

Drawbacks of belonging to a trading bloc?

A

-Increased competition
-Common rules and regulations
-Retaliation
-Inefficiency and trade diversion

47
Q

Define Trade diversion

A

Trade taken away from efficient producers who operate outside the bloc and replace by trade within the bloc

Business Theme 3 and 4 (10 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions