Chapter8

Question 0

Fundamental changes that allow global markets

Answer 0

Reduction or elimination of trade barriers
Standardization of laws internationally
Decreasing concern of distance and time with regards to moving product
Globally integrated production processes

Question 1

Globalization

Answer 1

The process by which goods and services capital and people flow across national borders

Question 2

Four sets of criteria necessary to assess a country’s market

Answer 2

Economic analysis
Infrastructure and technological analysis
Government actions or inactions
Sociocultural analysis

Question 3

Trade deficit

Answer 3

A country imports more goods than it exports (USA)

Question 4

Trade surplus

Answer 4

A country that exports more than it imports (China )

Note companies rather manufacture here

Question 5

GDP

Answer 5

Gross domestic is the market value of goods and services produced in a year

Question 6

GNI

Answer 6

GDP + net income from investments abroad(minus payments made to nonresidents who contribute tot the domestic economy

Question 7

PPP

Answer 7

theory that if exchange rates in tow countries are in equilibrium a product purchased in one country will be the same price in the other if expressed in the same currency

Question 8

BRIC

Answer 8

(Brazil Russia India China )
Likely to see the most market growth because stagnated growth makes high purchasing power countries like us and uk less attractive

Question 9

Rural areas

Answer 9

Increase product costs because more hands touch it

Question 10

Evaluating real income

Answer 10

Firms Can make make adjustments to a product or change the price to meet the unique needs of a country

Question 11

Infrastructure

Answer 11

Basic facilities and installments needed for a community or society to function

Question 12

4 elements of infrastructure

Answer 12

Transportation
Distribution channels
Communications
Commerce

Question 13

Economic analysis using metrics

Answer 13

General economic environment
Market size and population growth
Real income

Question 14

Infrastructure and technology transportation channels
Communication
Commerce

Answer 14

transportation
channels
Communication
Commerce

Question 15

Sociocultural analysis

Answer 15

Power distance
Uncertainty avoidance
Individualism
Masculinity
Time orientation

Question 16

Trade agreements

Answer 16

Signatory or the trading bloc to which it belongs

Question 17

Tariffs

Answer 17

Intended to make imported goods more expensive and less competitive

Question 18

Quotas

Answer 18

Maximum quantity that can enter a country

Question 19

Power distance

Answer 19

Willingness to accept social inequality as natural

Question 20

Individualism

Answer 20

Perceived obligation and dependence on groups

Question 21

Uncertainty avoidance

Answer 21

Extent to which society relies on orderliness structure consistency

Question 22

Masculinity

Answer 22

Men dominate power positions

Question 23

Time orientation

Answer 23

Short term vs long term

Example a country who values long term is will into wait for a product to be successful

Question 24

Brazil strengths

Answer 24

``` 7th largest economy Predicted growth rate to 5h largest economy Large population that is literate Imposition of social programs Growing middle class ```

Question 25

Russia

Answer 25

``` Ups and downs in economy Growing consumer market Well educated population Strong demand for US goods Strong internet presence Aging population Corruption ```

Question 26

India

Answer 26

``` Expanding middle class Young population Well educated Highly skilled workers Lacks modern supply chain facilities ```

Question 27

China

Answer 27

Unequal distribution of wealth Migrant workforce Slowing population Large economy 2nd

Question 28

global entry strategy

Answer 28

Export Franchise Strategic alliance Joint venture

Question 29

Exporting

Answer 29

Producing in one country selling in another

Question 30

Cons of exporting

Answer 30

Limited return | Difficult to achieve economies of scale

Question 31

Pros of exporting

Answer 31

Least risky because no infrastructure buildings etc

Question 32

Franchising

Answer 32

Contract agreement between franchiser and franchisee

Question 33

Pros of franchising

Answer 33

Less risky than full owning | Less investment

Question 34

Con of franchise

Answer 34

Limited control | Limited profit

Question 35

Strategic alliance

Answer 35

Collaborative relationships between independent companies Cisco and TaTa

Question 36

Joint venture

Answer 36

Pool two firms resources together

Question 37

Direct investment

Answer 37

Firm maintains 100% ownership | High risk

Question 38

GloCalization

Answer 38

Forms standardize products globally but use different promotional campaigns to sell them

Question 39

Reverse innovation

Answer 39

Companies develop niche products for underdeveloped markets and expand them in their original home markets