Globalization

Question 1

Tend away from distinct national economic units and toward one huge global market

Answer 1

Globalization

Question 2

Moving away from an economic system in which national markets are distinct entries, isolated by trade barriers and barriers of distance, time, and culture, and toward a system in which national markets are merging into one global market

Answer 2

Globalization of markets

Question 3

Trend by individual firms to disperse parts of their productive proceses to different locations around the globe to take advantages of difference in cost and quality of factors of production

Answer 3

Globalization of production

Question 4

State the 4 factors of production

Answer 4

1. Labor
2. Land
3. Capital
4. Energy

Question 5

What are the reasons why global institutions were created, specially after world war II

Answer 5

1. Institutions needed help to manage, regulate and police the global market place
2. Promote the establishment of multinational treaties to govern the global business system

Question 6

International treaty that committed signatories to lowering barriers to the free flow of goods across national borders and lead to the WTO

Answer 6

General agreement on tariffs and trade (GATT)

Question 7

Comprises the finance ministers and central bank governors of the 19 largest economies in the world, plus representatives from the European Union and the European Central Bank

Answer 7

Group of 20 (G20)

Question 8

International institutions set up to promote general economic development in the world’s poorer nations

Answer 8

World Bank (WB)

Question 9

The Organization that succeeded the General Agreement on Tariffs and Trade (GATT) as a result of the successful completion of the Uruguay round or GATT negotiations

Answer 9

World Trade Organizations (WTO)

Question 10

An international organization made up of 193 countries headquartered in New York City , formed in 1945 to promote peace, security , and cooperations

Answer 10

United Nations (UN)

Question 11

International institution set up to maintain order in the international monetary system

Answer 11

International Monetary Fund (IMF)

Question 12

State the 2 factors underlying the trend toward greater globalization

Answer 12

1. Decline of barriers

2. Technological changes

Question 13

Occurs when a firm exports goods or services to consumers in another country

Answer 13

International Trade

Question 14

Direct investment in business operations in a foreign country

Answer 14

Foreign Direct investment (FDI)

Question 15

What is moor’s law ?

Answer 15

This predicts that the power of microprocessors technology doubles and its cost of production falls in half every 18 month

Question 16

What is containerization of commerce?

Answer 16

It means that by reducing the time needed to get from one location to another has effectively shrunk the globe

Question 17

State the main changes in the demographic of the global economy over the past 30 years

Answer 17

1. U.S dominance in the world economy and world trade picture
2. U.S dominance in the world foreign direct investment
3. Dominance of large, multinational U.S firms on the international business scene

Question 18

Any firm that engages in international trade or investment

Answer 18

International Business