External Influences - Globalisation

Question 1

Define organic growth

Answer 1

Organic growth is growth within the business

Question 2

Define external growth

Answer 2

External growth is growing by merges and acquisitions

Question 3

Define globalisation

Answer 3

Globalisation is the increased integration and interdependence of international economies

Question 4

Define multinationals

Answer 4

Multinationals are businesses that has activities and operations in more than one country

Question 5

Name 3 factors for an increase in globalisation

Answer 5

1. Reduction in trade restrictions
2. More easy to transport capital
3. Increased movement of people

Question 6

Name 3 benefits of becoming a multinational

Answer 6

1. Ability to take advantage of the lack of legal constraints
2. New markets with less competition
3. Easier to obtain EOS

Question 7

Name three negatives of becoming a multinational

Answer 7

1. Workers in LEDC’s are low skilled
2. Unsafe working conditions
3. Chile labour abused

Question 8

Define what a global strategy is

Answer 8

A global strategy is where companies are keen to operate on a global scale so must consider how to build a competitive global advantage

Question 9

Define what a brand is

Answer 9

A brand is a distinctive product created by the use of a logo, symbol, name, design etc…

Question 10

Define what a global brand is

Answer 10

A global brand is a brand that can be recognised throughout most of the world

Question 11

Name 3 opportunities of globalisation

Answer 11

1. Take advantage of lower wages
2. Cheaper FOP
3. New markets with higher disposable incomes

Question 12

Name 3 threats of globalisation

Answer 12

1. Become unreliant of buying from UK as its cheaper elsewhere
2. Exchange rates may effect profit
3. Domestic jobs may be lost