Conditions That Prompt Trade Flashcards

1
Q

What is meant by a push factor

A

Something that happens within an existing market that forces a business to look elsewhere

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2
Q

What is meant by a pull factor

A

Something that attracts the business into the market

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3
Q

What is an example of a push factor

A

Saturated markets - becomes impossible to expand sales further
Lots of competition

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4
Q

What are examples of pull factors

A

Economies of scale

Diversifying can spread risk

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5
Q

What is the difference between offshoring and outsourcing

A

Outsourcing means buying inputs from another supply rather than making them in house
Offshoring refers to the process of locating production abroad to benefit lower wage rates

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