Theme four Flashcards
What is Gross Domestic Product?
The value of all goods and services produced in a country in the course of a year.
What is a balance of payments deficit?
Imports outweigh exports; if it continues indefinitely, it means ever greater build-up of foreign currency debt.
What is purchasing power parity?
Compares the prices of a fixed basket of goods and services in different countries e.g. a dollar might buy three times more groceries in India than in America
What is a trading bloc?
A regional grouping of countries agreeing to free trade - free movement of labour.
What is inward foreign direct investment?
Investment into a country such as the UK from companies abroad, perhaps in the form of buying up one of our businesses, or buying up property assets.
What is outward foreign direct investment?
Investment from a country such as the UK, perhaps building a factory in Brazil.
What is a saturated market?
A market where growth has ceased and there are no significant opportunities to boost sales other than stealing market share from existing rivals.
What is trade liberalisation?
Minimising the rules and regulations faced by businesses; or, on a global scale, reducing the barriers to freely moving international trade.
What is protectionism?
Giving preference to home producers by making it harder and more expensive for overseas companies to export to your country.
What is a trade war?
An economic battle between two countries based entirely on protectionist measures such as import quotas; one starts, so the other retaliates and this can spiral out of control.
What does bureaucracy mean?
From the French word for desk or office, a business or government that’s bound up in rules - often strangling initiative and enterprise.
What is a joint venture?
An agreement to work together on a specific project or region for a specified time.
What is a backwards vertical takeover?
Buying a business in the same industry but at an earlier stage in the supply chain, e.g. bakery buys flour mill.
What is an ethnocentric approach?
Centering on your own ethnicity, in other words sticking with the habits and attitudes that are common within your culture. It implies a refusal to change the product to suit local tastes.
What is a polycentric approach?
Welcoming of all cultures, and therefore willing to try to absorb new things such as foods and flavours from other countries. Polycentric marketing implies a clear ambition to spread a product internationally, localising as necessary.
