Business 3.1 Flashcards
imports
goods and services bought from other countries.
exports
goods and services sold to other countries.
balance of trade
the difference between a country’s total exports and total imports.
exchange rate
the value of a currency in one country compared with the value in another.
infrastructure
a factor that supports international trade in industrialized countries, including a nation’s transportation, communication, and utility systems.
trade barriers
restrictions to free trade.
quota
a government-set limit on the quantity of a product that may be imported or exported within a given period.
tariff
a tax that a government places on certain imported products.
embargo
an action imposed by the government to stop the export or import of a product completely.
multinational company (MNC)
an organization that does business in several countries. It usually consists of a home country and divisions or separate companies in one or more host countries.
joint venture
a unique business organized by two or more other businesses to operate for a limited time and for a specific project. It is a type of partnership.
Without foreign trade, many things you buy would cost more or not be available at all.
true
A free-trade zone is a selected area where products can be imported duty-free and then stored, assembled, and/or used in manufacturing.
true
A(n) _____ is the value of a currency of one country compared with the value of another.
exchange rate
A balance-of-payments calculation includes other forms of exchange among nations in addition to trade.
true
A U.S. manufacturer of computer chips wants to produce some of its chips in Japan. The U.S. company wants to do this with as little financial investment and risk as possible. It also does not want to be actively involved with the Japanese company. Which expansion method should the U.S. company use?
licensing
An organization that does business in several countries is known as a(n)_____ .
multinational company
which of the following situations in Russia would likely cause the value of the Russian ruble to rise?
low interest rates
A corporation that uses a global strategy _____.
uses the same product and marketing strategy worldwide.
One goal of the World Trade Organization (WTO) is to encourage lower tariffs.
true
domestic business
making, buying, and selling of goods and services within a country
International business
business activities needed for creating, shipping, and selling goods and services across national borders.
Absolute advantage
when a country can produce a good or service at a lower cost than other countries
