BIG PICTURE A Flashcards
Understand the nature, basic concepts and roles of international business and trade, determine the participants of international business and to understand why did some of the firms engage in internationalization.
- consists of transactions that are devised
and carried out across national borders to satisfy the objectives of individuals,
companies, and organizations.
International Business
refers to the transfer of assets to another country
or the acquisition of assets in that country
International Investment
is a company’s physical investment such as into
the building and facilities in the foreign country, and acts as a domestic
business with a full scale of activity.
Investment (FDI)
Trade
are deeds, performances, or
efforts performed directly by people working in banks, consulting firms, hotels,
construction companies, retailers, and countless other firms in the services sector
Services
tangible merchandise such as clothing,
computers, and motor vehicles.
Products
arises from differences in
language, lifestyles, mind-sets, customs, and religion. Values unique to a culture tend to be long lasting and transmitted from one generation to the
next.
Cross-Cultural Risk
the process by which businesses or other organizations develop international influence or start operating on an international scale
Globalization
refers to the potentially adverse
effects on company operations and profitability caused by developments in
the political, legal, and economic environment in a foreign country.
Country risk
refers to the firm’s potential loss or failure from poorly
developed or executed business strategies, tactics, or procedures.
Managers may make poor choices in such areas as the selection of
business partners, timing of market entry, pricing, creation of product
features, and promotional themes.
Commercial Risk
the initiator of an international business transaction; it
conceives, designs, and produces offerings intended for consumption by customers worldwide.
Focal Firm
are also active in international
business as suppliers, buyers, and regulators. State-owned enterprises
account for a substantial portion of economic value added in many
countries, even rapidly liberalizing emerging markets such as Russia,
China, and Brazil.
Governments
refers to the risk of adverse
fluctuations in exchange rates. Fluctuation is common for exchange
rates—the value of one currency in terms of another.
Currency Risk
is a specialist firm that provides
various logistics and marketing services for focal firms as part of
international supply chains, both in the focal firm’s home country and
abroad.
Distribution Channel
Intermediary
