Theme 4.1

Question 1

BRICs

Answer 1

-Brazil
-Russia
-India
-China
-South Africa

Question 2

MINT

Answer 2

-Mexico
-Nigeria
-Indonesia
-Turkey

Question 3

Risks for businesses trading with Emerging Economies

Answer 3

-Political instability
-Cultural differences
-Low cost production makes developed economies uncompetitive in some markets.

Question 4

Key indicators of economic growth

Answer 4

-GDP
-GDP per capita
-HDI
-Literacy

Question 5

Benefits to Exports

Answer 5

-Can help reduce poverty in countries
-Provides low prices for consumers as markets are more competitive.
-Economies of scale- causing lower unit costs and prices.

Question 6

Drawbacks to Exports

Answer 6

-Transport costs
-Negative impact on environment
-Rising inequality
-Pressure on wages and working conditions

Question 7

Specialisation

Answer 7

-When a country specialises in one product or service.
-Total economic output can be increased across the global economy.

Question 8

Foreign Direct Investment

Answer 8

-Investment from one country into another that involves establishing operations or acquiring tangible assets.

Question 9

Inward FDI

Answer 9

-A foreign retail firm invests to open new stores in the UK.
-Eg. an overseas business decides to build a manufacturing factory in the UK.

Question 10

Outward FDI

Answer 10

-A UK business completes a takeover of a business based in another country.
-Eg. A UK business expands into an overseas market by opening a new production facility.

Question 11

Reasons why businesses engage in FDI

Answer 11

-Take advantage of lower labour costs in other countries.
-Avoid protectionist measures.
-Earn target returns on investment buy buying valuable assets.