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Fashion Global Issues > Exam 1 Study Guide > Flashcards

Exam 1 Study Guide Flashcards

1
Q

What is globalization ?

A

Process of the world’s people, firms, and countries become increasingly interconnected in all facets of their lives

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2
Q

What are the four main factors of globalization?

A

Trade
Capital
Information
People

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3
Q

What country has the highest globalization in the world

A

Netherlands a European country

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4
Q

What are the levels of trade?

A

International trade
Global trade
Measuring levels of trade

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5
Q

Define international trade?

A

Any exchange of goods involving two or more countries

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6
Q

Define global trade

A

Includes the potential interactive participation of many groups,cultures, and nations in the manufacturing and distribution of products

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7
Q

What is measuring levels of trade

A

Exports-import = trade balance
Exports > imports = trade surplus
Exports < import = trade deficit

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8
Q

What are examples of least developed countries?

A

Ethiopia
Haiti
Madagascar
Uganda

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9
Q

What are examples of newly developing economies?

A

Bangladesh
Egypt
El Salvador
India

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10
Q

What are examples of developing economies?

A

Argentina
Brazil
China

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11
Q

What are examples of developed economies?

A

Australia
Canada
France

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12
Q

What are classifications of economic development?

A

Factors include GDP, GNI , human assets, health and education of population, economic vulnerability, stable government, agriculture production

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13
Q

What is GDP

A

Gross domestic product: total of all value created in an economy

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14
Q

What does GNI mean ?

A

Gross national income: total amount of money earned by a nation’s people and businesses

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15
Q

Least developed countries

A

Countries confronting severe structural impediments to
sustainable development
• United Nations (UN) classification
• Includes all least developed economy countries and some
newly developing economy countries

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16
Q

What are indicators of economic development?

A

Population wellbeing
Literacy rates
Infinity mortality
Life expectancy

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17
Q

Labor intensive apparel production

A

Despite technological advancements, remains labor
intensive
• Hard to automate aspects of textiles and various shapes and sizes of clothing
Low barriers to entry

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18
Q

Developed Countries

A

• All have used textile and apparel production as means of achieving economic growth
• Now import more than export and any production is likely for domestic consumption

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19
Q

Developing Countries

A

• Significantly improved overall economic conditions and
compete in global marketplace
• No longer low-cost labor source – must outsource
production
• Focus on textile manufacturing rather than appar

20
Q

Newly developing countries

A

• Tend to be economies that primarily rely on agriculture
• Highly favorable to textile and apparel production because
of low-cost labor, usually for women
• Have trade surplus (export more than import)
• Production for trade, not domestic consumption

21
Q

Least Developed Countries

A

• Attractive economy for low-cost labor
• However may suffer from other social issues such as political
unrest, unstable and/or corrupt governments

22
Q

Structure of the textile complex

A

Level 1: textile fiber manufacturing and agriculture -> fiber commodity marketing

Level 2 : textiles, findings, trims manufacturing-> wholesale materials marketing

Level 3: apparel , home furnishings, and industrial textile products manufacturing-> wholesale finished good marketing
Level 4 : retailing

Level 4: consumption, disposal

23
Q

Which fashion brand has the highest market capitalization

A
  1. LVHM( 17 brands)
  2. Nike
24
Q

ESTABLISHING A SUSTAINABLE SUPPLY CHAIN

A

• The supply chain begins and ends with the consumer
• Consumer demand drives the industry
• The global environmental footprint and social issues in
the industry raise issues of sustainability
• Government regulations, trade agreements, trade
regulations, intellectual property laws - all sources of controversy
• Identifying countries and vendors to build supply chains

25
Q

What are the four stages of clothing consumption process

A
  1. Acquisition
  2. Use
  3. Care
  4. discarding
26
Q

Define Active wardrobe

A

garments being worn

27
Q

Define Inactive wardrobe

A

garments not being worn or rarely used

28
Q

Unique Nature of Apparel Products

A

◦ Difference between need and want ◦ Nonverbal communication
◦ High degree of change in style and
design

29
Q

What is the difference between style and design

A

Distinctive characteristics - s

Variation of style - d

30
Q

What are the classification of apparel products ?

A

Basic
Fashion apparel
Classic apparel
Fads or fast fashion apparel

31
Q

Wellbeing

A

good or satisfactory condition of existence; a state of
being comfortable, healthy, and happy
◦ The types of products we consume are use to indicate it

32
Q

Level of consumption

A

◦ Overall amount of food, fuel, and other durable goods consumed ◦ The use of houses, cars, clothing, and other durable goods and services

A rise in consumption means an increase in volume or improvement in quality

33
Q

Standard of living

A

◦ Level of consumption urgently desired or strived for, plus the overall
well-being of an individual or group
◦ Often associated with monetary income as indicators of wellbeing
May differ for each person based on motivations

34
Q

Income elasticity

A

Describes the relationship between consumers’ change in income and resulting change in consumers’ expenditures

35
Q

Superior goods (luxury

A

income elasticity greater than 1
◦ As income increases, expenditures increase but at a faster rate than income

36
Q

Normal goods (necessity):

A

income elasticity 0 – 1
◦ As income increases, expenditures increase but at a slower rate than income

37
Q

Inferior goods (inadequate income)

A

income elasticity < 0 ◦ Expenditures decrease as income increases

◦ Clothing is moderate luxury (approx. income elasticity of 1.2)
◦ As income increases, people tend to spend more money on fashion goods, buying higher-end, more expensive products

38
Q

◦ Price elasticity

A

elasticity: Describes the relationship between the change in price of a product and the related change in demand for that product, or the quantity of that product sold
◦ To a merchant, the question is how much increase in sales will result from price decreases

39
Q

In the U.S., price elasticity for clothing is

A

Around 0.7

The price reduction increased clothing expenditures but at a slower rate than
the reduction in price

40
Q

Total Income:

A

gross income; income before taxes

41
Q

Disposable Income:

A

take-home pay; income after taxes and contributions

42
Q

Discretionary Income:

A

what remains after all current obligations
(e.g., rent, mortgage, bills, insurance, food, transportation, cell phone, other necessities)

43
Q

Poverty:

A

the lack of resources or income to satisfy minimum basic needs

◦ Approximately 12.4% of Americans live below the poverty line as of 2022

44
Q

What are the three factors affecting consumption expenditure patterns?

A
  • cpi : Consumer Price Index is used to measure impact of inflation on consumer purchasing power

Inflation : increase in prices that leads to decreased purchasing power

Demographics and psychographic shift

45
Q

Purchasing power

A

how much a dollar will get you

46
Q

What is the difference between regression and progressive tax ?

A

Lower-income people pay higher rate than higher-income people r

Increased tax rate as income rises

47
Q

Measuring Textile and Apparel Trade

A

◦ In number of units
◦ In monetary value( US dollars cost at ownership -buyer)

Fashion Global Issues (1 decks)

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