chapter 1 Flashcards
(29 cards)
What is globalization?
globalization refers to the shift towards a more integrated and interdependent world economy
How does international business differ from domestic?
currency conversion, legal systems, culture, and availability of resources
Why study international business?
any large organization you work for deals globally, could work for a foreign owned company, small businesses use products made abroad, business techniques and tools, cultural literacy
What are 5 IB things that have been shaped by history?
coinage, security, passage, markets, standardized weights and measures
Two recent eras of globalization
1st: colonization, british pound sterling, transportation and communication
2nd: collapse of USSR, opening up of China and other countries, technology and transportation
What are the 2 facets of globalization?
globalization of markets: merging of national markets
globalization of production: shift from home country production of goods to international production of goods
What are the international business activities?
exporting and importing, international investments, licensing, franchising, and management contracts
What are the British terms for intangible and tangible goods?
visible trade and invisible trade
Gross Domestic Product
total monetary value of all goods and services provided by a country in a year
Who has the highest GDP? top 4
- European Union
1. U.S.
2. China
3. Japan
4. India
What is the top 10 list for exports as a % of GDP?
- Hong Kong 2. Singapore 3. Luxembourg 4. Netherlands 5. Germany 6. Mexico 7. UK 8. China 9. India 10. U.S.
What are the top 3 ports?
- Shanghhai, China 2. Singapore, Singapore 3. Rotterdam, Netherlands
- South Louisiana 12. Houston
Who are the top world oil producers?
Russia, Saudi Arabia, USA
Top sources of US imports
Canada, Saudi Arabia, Mexico
What are the 2 types of international investments?
foreign direct investments and foreign portfolio investments
Stock of foreign direct investments abroad
all the money you have invested in other countries
Stock of foreign direct investment at home
all the money you have invested in at home
What is flow?
measures the same thing as stock of foreign direct investments but at one point in time
What are the 3 methods of FDI?
Greenfield: enter into a new market w/ou help of another business who is already there
Aquisition/Brownfield Strategy
Joint Venture: go in on a new business togetther
Licensing
you are allowing the other party to use your intellectual property
Franchising
same as licensing but you are required to run the business the certain way they do things
Management Contracts
sell the services of your expertise
Who are the 3 largest MNC’s?
Royal Dutch Shell, Wal-Mart Stores, Exxon Mobile
What are the 2 big reasons for contemporary causes of globalization?
strategic imperatives(motivate) and environmental changes (facilitate)
