External influences Flashcards
1
Q
Globalisation is …
A
The process of growth in world markets through a process of integration where it is possible to trade in a global market on the same way as one would in a domestic market
2
Q
What is international trade?
A
the exchange of goods, services and capital across the borders of different countries
3
Q
Why is international trade beneficial to companies?
A
- variety
- economic efficiency
- growth
- international co-operation
- specialisation
4
Q
Why is competition useful?
A
- forces businesses to be efficient
- keep prices low for consumers
- encourages innovartion
5
Q
Barriers to entry
A
- high start up costs
- legal barriers
- economies of scale from existing firms
- superior knowledge
6
Q
Barriers to exit
A
- high redundancy costs
- can’t sell factories
- can’t break contacts with suppliers
7
Q
What is CMA and what does it do?
A
Competition and Markets Authority
– enforces competition law
