4.2.1 conditions that prompt trade

Question 1

push factors

Answer 1

something that happens in an existing market that pushes the business to look elsewhere for success
saturated domestic markets, low growth opportunities, end of the product life cycle, need to diversify, need to reduce risk

Question 2

pull factors

Answer 2

something that happens in another market that attracts a business towards it.
attraction to new overseas markets in emerging economies, opportunity to gain eos by expending overseas, opportunity to exploit competitive advantages in new markets

Question 3

offshoring

Answer 3

a business may decide to relocate its business overseas.
takes advantage of low labour costs in manufacturing, cost efficiencies and supply chains

Question 4

outsourcing

Answer 4

where a business functions such as payroll is contracted out to a third party business