test 4

Question 1

define economic development

Answer 1

It is known as an increase in average per capita gross domestic product (GDP) production which increases national production.

Rapid economic growth increases consumer demand.

Question 2

Define the relationship between time zone and marketing operations

Answer 2

Virtual meetings are hard to execute.

Time zones have the greatest influences successful commercial efforts abroad.

The common time zones give the Europeans advantages in both Africa and the Middle East.

There is the most economic growth in countries that have the same time zone.

Question 3

Trading areas defined by time zones

Answer 3

Americas
Europe and Africa
Asia pacific

Question 4

The economic growth within a country affects what?

Answer 4

Attitudes towards foreign business

The demands for good

The distribution systems found within a country

The entire marketing process

Question 5

Define UN classification of countries based on economic development

Answer 5

Most developed – industrialised countries with high per capita incomes (Canada, England, France)

Less developed – industrially developing countries just entering world trade with relatively low per capita incomes (Asia and Latin America)

Least developed – industrially underdeveloped, agrarian, subsistence (Africa)

Question 6

More-developed countries (MDCs):

UN classification

Answer 6

Industrialized countries with high per capita incomes, such as Canada, England, France

Question 7

Less-developed countries (LDCs):

UN classification

Answer 7

Industrially developing countries just entering world trade with relatively low per capita incomes, such as many countries in Asia and Latin America

Question 8

Least-developed countries (LLDCs):

UN classification

Answer 8

Industrially underdeveloped, agrarian, subsistence, such as Africa

Question 9

Understand the new classification (IMF and WB)

Answer 9

Developed economies (Canada, US, France, Sweden, etc.)

Emerging markets (China, Brazil, Mexico, South Africa, Taiwan, etc.)

Developing economies (Africa)

Question 10

Developed economies

IMF and WB

Answer 10

Canada, US, France, Sweden,

Question 11

Emerging markets

IMF and WB

Answer 11

China, Brazil, Mexico

Question 12

Developing economies

IMF and WB

Answer 12

Africa

Question 13

Economic growth factors

Answer 13

Political stability

Economic and legal factors

Planning

Production

Industries targeted for growth

Incentives to force high domestic rate of savings, update infrastructure, transportation, education

Question 14

The influence of infrastructure on a country’s economic development

Answer 14

Infrastructure represents capital goods that serve the activities of many industries.

Infrastructure increases economic development

Business efficiency is affected by their presence or absence.

Question 15

What are marketing contributions to economic development?

Answer 15

Marketing is the middle man between productive capacity and consumer demand.

The marketing process can create a balance between higher production and higher consumption.

Question 16

Explain marketing in developing countries

Answer 16

Marketing must be tailored to each circumstance

Pricing in poorer countries may have different problems to pricing in more developed countries.

A marketer must assess the existing level of marketing development and its receptiveness to understand the marketing potential of a country.

Question 17

The relationship between market development and economic development

Answer 17

The level of market development roughly parallels the stages of economic development.

When an economy is more developed, more marketing functions are demanded, and the institutions become more specialised and sophisticated.

As countries develop, the distribution channel systems develop.

Question 18

Understand the Americas regional economic integration

Answer 18

US and Canada: CFTA

US, Canada and Mexico: NAFTA (new CUSMA) to reduce tariffs among country members

Dominican Republic free trade agreement (DR-CAFTA) : Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua and US.

Question 19

CFTA

Answer 19

US and Canada

Question 20

NAFTA (new CUSMA)

Answer 20

US, Canada and Mexico

Used to reduce tariffs among country members

Question 21

The strategic implications of economic development for marketing

Answer 21

As a country develops, incomes change, population concentrations shift, expectations for a better life, new infrastructures evolve

When incomes rise, new demand is generated at all income levels.

As incomes rise to middle-class range, demand for more costly goods increases.

Question 22

least to most powerful economic integration stages

Answer 22

Regional cooperation groups

Free Trade area

Custom Union

Common market

Economic Union

political union

Question 23

Understand European institutions

Answer 23

European Commission – Initiates policy and supervises its observance by member states

Council of Ministers – The decision-making body; determines which proposals of the Single European Act to accept as binding to members

The European Parliament – Passes and amends legislation

Court of Justice – The Supreme Court of the European Union



Question 24

European Commission

Answer 24

Initiates policy and supervises its observance by member states

Question 25

Council of Ministers

Answer 25

The decision-making body; determines which proposals of the Single European Act to accept as binding to members

Question 26

The European Parliament

Answer 26

Passes and amends legislation

Question 27

Court of Justice

Answer 27

The Supreme Court of the European Union

Question 28

Benefits of the Euro

Answer 28

Created a single currency for most countries

Easier to compare prices across

Europe Firms are more competitive

Increase range of investment options

Established a central bank

Question 29

Costs of Euro

Answer 29

Loss of control over National monetary policy

EU is not an optimal currency area

It took a bit of time for countries to come on board with the euro

Question 30

Economic development in Africa

Answer 30

Ethiopia, Angola, and Malawi each experienced annual growth rates of greater than 8% between 2007 and 2011.

Countries in the sub-Saharan region have grown faster than 5% annually.

There has been little progress toward economic integration because of political instability.

Question 31

Examples of regional economic integration in Africa

Answer 31

AMU

CEN-SAD Community of Sahel-Saharan States

COMESA – Common Market for East and Southern Africa

Question 32

Examples of regional economic integration in Americas

Answer 32

NAFTA

Question 33

Examples of regional economic integration in Europe

Answer 33

EU – 27 members

EFTA 4 members

Question 34

Understand the dynamic growth in the Asia Pacific Region

Answer 34

Asia has been the fastest growing area in the world for the past three decades.

In 1996, the leading Asian economies experienced a financial crisis that resulted in the crash of the Asian stock market.

Question 35

What is referred to as greater China?

Answer 35

Greater China refers to both the People’s Republic of China (PRC) and the Republic of China (ROC) or Taiwan.

Question 36

Understand greater China economic development drivers

Answer 36

Two major events that occurred in 2000 are having a profound effect on China’s economy:
Admission to the World Trade Organization.

United States’ granting normal trade relations (NTR) to China on a permanent basis (PNTR).

China can be thought of as a group of regions rather than a single country due to its size.

Human rights and the legal system are major issues.

Question 37

Other problems China face in the longer run

Answer 37

Environmental decline is associated with its fast growth.

The demographic disaster associated with its one-child policy.

Managing the current great transition from rural to urban living.

Question 38

What does BOPMs stand for?

Answer 38

Bottom-of-the-Pyramid Markets

Question 39

Understand BOPMs

Answer 39

The bottom of the pyramid consists of 4 billion people across the world with annual incomes of less than $1,200

These markets are not necessarily defined by national borders but rather by the pockets of poverty across countries.

They are part of the least developed countries and the developing countries

Question 40

Understand marketing opportunities in the Greater China

Answer 40

There are extreme differences in economic well-being, cultures, and political structures.

The rich municipalities like Beijing and Shanghai are quite comparable to Paris, New York, or Tokyo in terms of the availability of luxury products.

In China, you cannot sell the same lines of cosmetics or shampoos nationwide (unlike in the US).

China is large and rich and therefore
seen as a “more-developed country.”