PRELIM Flashcards
It refers to the transfer of assets to another country, or acquisition of assets in that country. With trade, products and services cross national borders.
international investment
The procurement of products or services from suppliers located abroad for consumption in the home country or a third country.
importing
It refers to an internationalization strategy in which the firm establishes a physical presence abroad through acquisition of productive assets such as capital, technology, labor, land, plant and equipment.
foreign trade investment
It refers to a situation or event where a cultural miscommunication puts some human value at stake.
cross cultural risk
It refers to the potentially adverse effects on company operations and profitability caused by developments in the political, legal, and economic environment in a foreign country.
country risk
It refers to the risk of adverse fluctuations in exchange rates.
currency risk
It refers to the firm’s potential loss or failure from poorly developed or executed business strategies, tactics, or procedures.
commercial risk
A large company with substantial resources that performs various activities through a network of subsidiaries and affiliates located in multiple countries.
multinational enterprise
A company with 500 or fewer employees.
small and medium sized enterprise
A young entrepreneurial company that initiates international business activity very early in its evolution, moving rapidly into foreign markets.
born global firm
They pursue special causes and serve as an advocate for the arts, education, politics, religion, and research.
non governmental organizations?
Nations’ collective aspirations and objectives that guide their development and progress.
common goals
The quantity of a good or service that consumers are willing to buy at various prices.
demand
An entry strategy involving the sale of products or services to customers located abroad, from a base in the home country or a third country.
Exporting
A system of institutions and laws that provide the framework for organizing and regulating the nation.
Government
It refers to the performance of trade and investment activities across national borders.
International Business
It refers to an exchange of products and services across national borders.
International Trade
A shared sense of belonging and identification among the people, often based on factors such as language, history, and culture.
National Identity
A group of people who share a common identity, culture, and history within that territory.
Population
The acknowledgment of a nation’s existence by other nations and international bodies.
Recognition
The ability of a nation to govern itself independently, making decisions on domestic and foreign affairs without external interference.
Sovereignty
The quantity of a good or service that producers are willing to offer for sale at various prices.
Supply
A specific geographical area with recognized borders where the nation resides.
Territory
The concept of exchanging goods and services between two people or entities
Trade.
The concept of this exchange between people or entities in two different countries
International Trade.
This theory stated that a country’s wealth was determined by the amount of its gold and silver holdings.
Mercantilism
This theory focused on the ability of a country to produce a good more efficiently than another nation.
Absolute Advantage
Occurs when a country cannot produce a product more efficiently than the other country.
Comparative Advantage
Their theory focused on MNCs and their efforts to gain competitive advantage against other global firms in their industry.
global strategic rivalry theory
This theory states that most trade in manufactured goods will be between countries with similar per capita incomes, and intraindustry trade will be common.
Linder’s country similarity theory
This theory incorporates other product and service factors, including brand and customer loyalty, technology, and quality, into the understanding of trade flows.
firm based theories
This theory focused their attention on how a country could gain comparative advantage by producing products that utilized factors that were in abundance in the country.
Heckscher-Ohlin theory
This theory in the United States should have been importing labor intensive goods, but instead it was actually exporting them
factor proportions theory
The theory assumed that production of the new product will occur completely in the home country of its innovation.
product life cycle theory
It states that a nation’s competitiveness in an industry depends on the capacity of the industry to innovate and upgrade.
Competition
This occurs when a company sells a product below market price often in order to win market share and weaken a competitor.
anti-dumping rules
These are the bureaucratic policies and procedures governments may use to deter imports by making entry or operations more difficult and time consuming.
administrative policies
A form of government payment to a producer.
Subsidies
These are taxes imposed on imports
Tariff
10 FUNDAMENTALS OF TRADE
- Supply and Demand
- Market Prices
- Competition
- Specialization and Comparative Advantage
- Trade Surpluses and Deficits
- Trade Barriers
- Currency Exchange Rates
- Trade Agreements
- Globalization
- International Institutions
