Chapter 3 Flashcards
International Business
the buying, selling, and trading of goods, services, and services across national boundaries.
Absolute Advantage
a monopoly that exists when a country is the only source of an item, the only producer of an item, or the most efficient producer of an item.
Comparative Advantage
the basis of most international trade, when a company specializes in products that t can supply more efficiently or at a lower cost than it can produce other items.
Outsourcing
the transferring of manufacturing of other tasks, such as data processing, to countries where labor and supplies are less expensive.
Exporting
the sale of goods and services to foreign markets.
Importing
the purchase of goods and services from a foreign market
Balance of Trade
the difference in value between a nation’s exports and imports.
Trade Deficit
a nation’s balance of trade, which exists when that country imports more products than it exports
Balance of Payments
the difference between the flow of money into and out of a country.
Infrastructure
the physical facilities that support a country’s economic activities, such as, railroads, highways, ports, airfields, utilities and power plants, schools, hospitals, communication systems, and commercial distributions systems.
Exchange Rate
the ratio at which one nation’s currency can be exchanged for another nation’s currency
Import Tariff
a tax levied by a nation on goods imported into the country
Exchange Controls
regulations that restrict the amount of currency that can be bought or sold
Quota
a restriction on the number of units of a particular product that can be imported into a country.
Embargo
a prohibition on a trade in a particular product
