business theme 4

Question 1

what are the 3 measurements of HDI

Answer 1

life expectancy

mean years of schooling

gross national income

Question 2

what is foreign direct investment (HDI)

Answer 2

direct investment into a country leading to a business becoming a multi national corporation.

Question 3

What are reasons for FDI

Answer 3

investment in expanding industries and fast growing profitable businesses

access to local resources e.g copper

access to local knowledge and skills

Question 4

methods of FDI

Answer 4

setting up a production facility

a joint venture with a local firm

buying assets in a foreign country

Question 5

causes of globalisation

Answer 5

developments in transport and communication

migration

trade barriers

transnational companies/FDI

politics

labour force

Question 6

methods of protectionism / trade barriers

Answer 6

tarrifs (tax on imports)

subsidies - gov grants to support businesses to lower prices or make a product

quotas - limits set on imports/goods sold

Question 7

risks of protectionism

Answer 7

forces businesses to use expensive domestic suppliers which decreases competitiveness

encourages businesses to move abroad to avoid trading barriers

Question 8

what are trading blocks and examples

Answer 8

agreements between nations to allow free trade and collaboration

e.g NAFTA and ASEAN