Chapter 17 Flashcards
resources markets and competition are world wide in scope
global economy
is the process of growing interdependence among elements of the global economy
globalization
is the creation of domestic jobs y foreign employers
insourcing
shifts local jobs to foreign locations to take advantage of lower wage labor in other countries
outsourcing
conducts commercial transactions across national boundaries
international business
firms purchase materials manufacturing or services around the world for local use
global sourcing
is a network of a firm’s outsourcing suppliers and contractors
global supply chain
moves foreign production and jobs back to domestic locations
reshoring
local products are sold abroad
exporting
is the process of acquiring products abroad and selling them in domestic markets
importing
one firm pays a fee for rights to make or sell another company’s products
licensing
a firm pays a fee for rights to use another company’s name and operating methods
franchising
operates in a foreign country through co-ownership with local partners
joint venture
each partner hops to achieve through cooperation things they couldn’t do alone
global strategic alliance
is a local operation completely owned by a foregin firm
foreign subsidiary
establishes a foreign subsidiary by building an entirely new operation in a foregin country
greenfeild venture
is a golbal instituation established to promote free trade and open markets around the world
World Trade Organization
gives a trading partner the most favorable treatment for imports and exports
Most favored nation status
are taxes governments enact to discourage imports sucha s quotas and import restrictions
Nontarriff barriers
is a call for tariffs and favorable treatments to protect domestic firms from foreign competition
Protectionism
links Canada the Unites States and Mexico in an economic alliance
NAFTA - North American Free Trade Agreement
is a political and economic alliance of 28 European Countries
EU - European Union
that links 21 nations to promote free trade and investment in the pacific region
APEC - Asia Pacific Economic Cooperation
links 14 southern African countries in trade and economic development efforts
SADC - Southern Africa Development Community
has extensive international business dealings in many foreign countries
global corporation, multinational corporation
is an MNC that operates world wide on a borderless basis
transnational corporation
is where a large global firms gain disproportionately from the global economy versus smaller firms
globalization gap
involves illegal practices to further on’s business interests
Corruption
makes it illegal for US firms and their representatives to engage in corrupt practices overseas
Foreign Corrupt Practices Act
employ workers at very low wages for long hours and in very poor working conditions
sweatshops
is the full time employment of children for work otherwise done by adults
child labor
is possible profit loss because of fluctuation exchange rates
currency risks
is possible loss because of instability and political changes in foreign countries
political risks
forecasts how political events many have an impact on foreign investments
political risk analysis
is a culturally aware and informed on international affairs
global manager
