Definitions Flashcards
Absolute Advantage
Exists if the real resource cost of a product is lower in one country than another.
Backward Innovation
Involves developing low cost products that will appeal to people with relatively low income,
BRIC
Stands for Britain, Russia, Ireland and China. These are the world’s four largest growing economies. The term is sometime used to refer to all fast growing economies.
Commodities
Are raw materials or semi-manufactured products that are traded in bulk and are not recognisably originating from any particular business. Examples include: Iron ore, cotton, wheat and oil.
Common Markets
Common markets have completely free trade internally and a single unified trade policy covering all member countries’ trade with the rest of the world. But besides free movement of goods and services there is also free movement of people and capital.
Corporate Culture
Is the set of important assumptions that are shared by people working in a particular business and influence the ways in which decisions are taken there.
Corporate Social Responsability
Means taking decisions in a way that takes into account all stakeholders interests. Treating employees, customers and suppliers fairly, avoiding polluting activities and contributing to the local community might be part of this.
Cultural Imperiaism
Is the practice of promoting, distinguishing, separating or artificially injecting the culture of one society into another. It is usually the case that the former belongs to a larger more powerful nation and the latter belongs to a smaller, less important one.
Developed Countries
All have high incomes,. Through capital investment they have developed sophisticated production facilities.
Developing Countries
Have relatively low standards of living, small manufacturing sectors and majority of the population may be engaged in agriculture, they also have limited infrastructure.
Diversifying
Means selling more than one product, or the same product in more than one market.
Economies of Scale
Are a reduction in average costs of production brought about by an increase in the size and scale of the business
Emerging Economies
Are characterised by rapid economic growth. They have seen big increases in manufacturing output and standards of living are rising.
Ethical Decision Making
Means following codes of practice that embody moral values. The objective is to do the right thing, acting honestly and taking into consideration the interests of everyone.
Ethnocentric Model
An approach of marketing based on the tendency to look at the world primarily from the perspective of ones own culture. A business believes that what was a success story in the domestic market will also be so in the other countries it operates in.
