CHP 1 Flashcards
What is international Business
business activities carried out across national borders
What is a Foreign Business?
operations of a company outside the home
What is a Multi-domestic company
(MDC) organization with multi-country affiliates, each which formulates its own business strategy based on perceived market differences.
What is a Global Company
(GC) organization that attempts to standardize and integrate operations worldwide in all functional areas
What is an International Company
(IC) global or multinational company
What is a Transnational Company or Multinational Company (same things)
company that combines the characteristics of global and multinational firms; responsiveness to different global enviroments
What is GDP and how is it calculated?
Gross Domestic Product=
G (government spending)+I (investments) +C (consumption)+NX (Net Exports)=GDP
How is NX calculated?
Net Exports= Exports - Imports
What is GNP and how is it calculated?
Gross National Product= GDP+ production by national borders
What is different about international business and what 3 environments does it deal with?
operates across borders ;domestic, foreign, and international
What are some influences of External and Internal Environmental forces? (5)
- Domestic Environment
- Foreign Environment
- International Environment
- Decision Making is more complex
- Self-reference Criterion
What is Domestic Environment?
uncontrollable home country factors that surround and influence the firm
What is a Foreign Environment?
uncontrollable forces originate outside the home country and surround and influence the firm. Forces are interrelated
What is International Environments
interaction between domestic and foreign environmental forces
T/F International Trade and the international firm are not new aspects of business?
True
From what records indicate of International Business?
Phoenician and Greek merchants were selling abroad before time of Christ
International firms are becoming…
objects of much discussion, especially the increasing globalization of their production and their markets
What are the 2 most Important dates advancing globalization?
Nov 9, 1989: fall of Berlin Wall
December 25, 1991: fall if USSR-resulted to 15 countries
What is a result of the expanding number of international companies?
the subsidiaries of foreign companies have become increasingly important in the industrial and economic life of many nations, developed and developing
What is Foreign Direct Investment?
FDI refers to direct investments in equipment, structures, and organizations in a foreign country at a level that is sufficient to obtain significant management control
Variable used to measure growth of international firms and businesses
Is the increase in total foreign direct investments
Globalization has no widely accepted definition having many varieties and it continues to…?
broaden
What is globalization
economical globalization- international integration of goods, technology, information, labor, and capital; or the process of making this integration happen
What are the drivers of Globalization (5.)
- Political Drivers
- Technological Drivers
- Market Drivers
- Cost Drivers
- Competitive Drivers
How are Political Drivers affecting globalization
trend toward unification and socialization of global community. redunction of barriers to trade and foreign investments and the privatization of industry are hastening the opening of new markets by international firms
How are Technological Drivers affecting globalization
advances in computers and communications technology are permitting and increased flow of ideas and information across borders, enabling small firms to compete globally
How are Market Drivers affecting globalization
as companies globalize, they also become global customers
How are Cost Drivers affecting globalization
globalizing product lines help to achieve economies and scale, which reduce development, production, and inventory costs.Company can also locate where the factors of production are lower
How are Competitive Drivers affecting globalization
companies are defending their home markets from foreign competitors by entering the competitors home markets to distract them
What are some of the Arguments supporting globalization/Free Trade
- enhances socioeconomic development
2. promotes more and better jobs
How does Free Trade enhance socioeconomic Development?
Data have shown a clear and definitive link between liberalization of trade and economic growth.
What are some concerns with globalization?
- produces uneven results across nations and people
- Damaging effects on labor and labor standards
- decline in environmental and health conditions
What are motives for entering foreign markets
- desire for increased profits and sales or
2. protect profits and sales from cometition
7 dimesions for globalizing a business
- Products
- Markets
- Promotion
- Value-added
- Competitive strategy
- Use of non-home country personnel
- Extent of global owernship in firm
