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Management > Chapter 8 Global Business > Flashcards

Chapter 8 Global Business Flashcards

1
Q

multinational corporation

A

a corporation that owns businesses in two or more countries

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2
Q

direct foreign investment

A

a company builds a new business or buys an existing business in a foreign country

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3
Q

trade barriers

A

government-imposed regulations that increase the cost and restrict the number of imported goods

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4
Q

protectionism

A

government’s use of trade barriers to shield domestic companies and their workers from foreign competition

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5
Q

nontariff barriers

A

nontax methods of increasing the costs or reducing the volume of imported goods

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6
Q

what are the five types of nontariff barriers?

A

quotas, voluntary export restraints, government import standards, government subsidies, and customs valuation/classification

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7
Q

quota

A

a limit on the number or volume of imported goods

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8
Q

voluntary export restraints

A

voluntarily imposed limits on the number or volume of products exported to a particular country

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9
Q

government import standards

A

standard ostensibly established to protect the health and safety of citizens but, in reality, is often used to restrict imports

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10
Q

subsidies

A

government loans, grants, and tax deferments given to domestic companies to protect them from foreign competition

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11
Q

customs classification

A

classification assigned to imported products by government officials that affects the size of the tariff and the imposition of import quotas

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12
Q

General Agreements of Tariffs and Trade (GATT)

A

worldwide trade agreement that reduced and eliminated tariffs, limited government subsidies, and established protections for intellectual property

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13
Q

World Trade Organization (WTO)

A

only international organization dealing with the global rules of trade between nations; its main function is to ensure that trade flows as smoothly, predictably, and freely as possible

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14
Q

regional trading zones

A

areas in which tariff and nontariff barriers on trade between countries are reduced or eliminated

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15
Q

Maastricht Treaty of Europe

A

regional trade agreement among most European countries

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16
Q

United States-Mexico-Canada Agreement (USMCA)

A

regional trade agreement among the United States, Mexico, and Canada

17
Q

Dominican Republic-Central America Free Trade Agreement (CAFTA-DR)

A

regional trade agreement among Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and the United States

18
Q

Southern Common Market (MERCOSUR)

A

regional trade agreement among the primary countries of Argentina, Brazil, Paraguay, and Uruguay, with associated countries, Bolivia, Chile, Colombia, Ecuador, Guyana, Peru, and Surinam

19
Q

Association of Southeast Asian Nations (ASEAN)

A

regional trade agreement among Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Phillipines, Singapore, Thailand, and Vietnam

20
Q

Asian-Pacific Economic Corporation (APEC)

A

regional trade agreement among Australia,Canada, Chile, the People’s Republic of China, Hong Kong, Japan, Mexico, New Zealand, Papua New Guinea, Peru, Russia, South Korea, Taiwan, the United States, and all the members of ASEAN except Cambodia, Lao PDR, and Myanmar

21
Q

Tripartite Free Trade Agreement (TFTA)

A

a regional trade agreement among 27 African countries

22
Q

global consistency

A

when a multinational company has offices, manufacturing plants, and distribution facilities in different countries and runs them all using the same rules, guidelines, policies, and procedures

23
Q

local adaptation

A

modifying rules, guidelines, policies, and procedures to adapt to differences in foreign customers, governments, and regulatory agencies

24
Q

what are the phases of globalization?

A

exporting, cooperative contracts, strategic alliances, and wholly-owned affiliates

25
Q

exporting

A

selling domestically produced products to customers in foreign countries

26
Q

cooperative contract

A

an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in their country

27
Q

what are the two types of cooperative contracts?

A

licensing and franchising

28
Q

licensing

A

an agreement in which a domestic company receives royalty payments for allowing another company to produce the licensor’s product, sell its service, or use its brand name in a specified foreign market

29
Q

franchise

A

a collection of networked firms in which the manufacturer or marketer of a product or service licenses the entire business to another person or organization

30
Q

strategic alliance

A

an agreement in which companies combine key resources, costs, risks, technology, and people

31
Q

joint venture

A

strategic alliance in which two existing companies collaborate to form a third, independent company or engage in a clearly defined business activity

32
Q

wholly owned affiliates

A

foreign offices, facilities, and manufacturing plants that are 100 percent owned by the parent company

33
Q

global new ventures

A

new companies that are founded with an active global strategy and have sales, employees, and financing in different countries

34
Q

purchasing power

A

the relative cost of a standard set of goods and services in different countries

35
Q

what are two types of political risk?

A

political uncertainty and policy uncertainty

36
Q

political uncertainty

A

risk of major changes in political regimes that can result from war, revolution, death of political leaders, social unrest, or other influential events

37
Q

policy uncertainty

A

the risk associated with changes in laws and government policies that directly affect the way foreign companies conduct business

38
Q

national culture

A

set of shared values and beliefs that affect the perceptions, decisions, and behavior of the people from a particular country

39
Q

expatriate

A

someone who lives and works outside their native country

Management (11 decks)

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