Module 1

Question 1

is a company which provides goods and services to a local population. The term may also be used to describe a franchise or corporate branch operating within a local area.

Answer 1

Local Business

Question 2

refers to the trade of goods, services, technology, capital and/or knowledge across national borders and at a global or transactional scale.

Answer 2

International business

Question 3

International business is also known as __________.

Answer 3

globalization

Question 4

is the exchange of capital, goods, and services across international borders or territories. It is the exchange of goods and services among nations of the world.

Answer 4

International trade

Question 5

also known as International trade

Answer 5

Global trade

Question 6

is simply the import and export of goods and services across international boundaries.

Answer 6

Global trade

Question 7

refers to the shift toward a more integrated and interdependent world economy.

Answer 7

Globalization

Question 8

Globalization has several facets, including the ____________ and ____________ .

Answer 8

globalization of markets and globalization of production

Question 9

refers to sourcing goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production (such as labor, energy, land, and capital)

Answer 9

globalization of production

Question 10

The increase of international trade over the years has been a result of the _____________ .

Answer 10

globalization process

Question 11

In International trade, both ______ and _______ can now choose from a wider range of products and services.

Answer 11

consumers and companies

Question 12

Also, globalization refers to the interdependence between countries arising from the integration of different aspects of the economy, such as ________ .

Answer 12

Trade

Question 13

Importance of International Trade between countries is an Important factor in:

Answer 13

(1) Raising living standards
(2) Providing employment
(3) Enabling consumers to enjoy a greater variety of goods

Question 14

is anything used by society as a medium of exchange, and is widely acceptable for the payment of goods and services without questioning the integrity of the person offering it.

Answer 14

Money

Question 15

was the first stage of monetary development. It is the direct exchange or swapping of goods for goods, services for services, goods for service, or services for goods.

Answer 15

Barter System

Question 16

Society abandoned the barter system for the following reasons:

Answer 16

(1) Difficult to look for the person who has the things you need and who also wants the things you are offering for exchange.

(2) There is no common denominator to measure the value of goods and services sought for exchange.

(3) Most of the goods traded have unequal values.

(4) It is time consuming, cumbersome and very inconvenient for individuals to use the barter system.

(5) It lacks generalized purchasing power.

Question 17

What are the two ways of keeping money for future use:

Answer 17

(1) By saving
(2) By investing

Question 18

By saving, the productive way of keeping money for future use is by ______ it in a bank.

Answer 18

depositing

Question 19

The ______ makes money out of other people’s money by lending it to others for productive purposes.

Answer 19

bank

Question 20

By investing, investment in business has three divisions, namely;

Answer 20

(1) Industrial business
(2) Commercial business
(3) Servicing business

Question 21

is concerned with the manufacture of goods, examples, oil industry and fishing industry.

Answer 21

Industrial business

Question 22

is concerned with bridging the gap between the producer and consumer. It deals with the distribution of goods.

Answer 22

Commercial business

Question 23

is concerned with the rendering of services such as restaurant, tailoring and banks.

Answer 23

Servicing business

Question 24

Basic similarities of International and Domestic Trade

Answer 24

(1) Both deal in the same objects of exchange, that is, goods and services
(2) Both kinds of trade are carried on by individuals and business firms
(3) Both domestic and international trade are stimulated by the desire for profit.

Question 25

Striking differences of International trade and Domestic Trade:

Answer 25

(1) Independence Currency System (2) Tariffs and Other Trade Restrictions (3) Movement of Labor and Capital (4) Nature of the market

Question 26

Purchases and sales of goods within a domestic market are, as a general rule, negotiated with money or currency that is uniform in all parts of the country.

Answer 26

Independence Currency System

Question 27

The existence of tariffs constitutes another difference between domestic trade and international trade.

Answer 27

Tariffs and Other Trade Restrictions

Question 28

Within a country, labor and capital are relatively mobile. In the particular case of labor, it is customary to observe that young people generally move from regions of least labor opportunities.

Answer 28

Movement of labor and capital

Question 29

Differences in the habits and tastes of the people, in their language and business customs, make the carrying of foreign trade a more complicated pursuit than domestic trade.

Answer 29

Nature of the market

Question 30

Important bases of International Trade

Answer 30

(1) Difference in Environmental Conditions (2) Stage of Economic Development (3) Population Distribution (4) Transportation and Communication Facilities (5) Price Structure

Question 31

As already indicated, no nation is self sufficient.

Answer 31

Difference in Environmental Conditions

Question 32

Broadly speaking, countries, the world over may be classified as failing under two categories: the underdeveloped and the highly developed.

Answer 32

Stage of Economic Development

Question 33

described as the poor countries

Answer 33

underdeveloped

Question 34

frequently referred to as the rich countries

Answer 34

highly developed

Question 35

The character as well as the density of population affect greatly the flow as well as the direction of international trade. Some countries which have relatively small populations like Australia and Canada are able to produce surplus goods in excess of the requirements of their people.

Answer 35

Population Distribution

Question 36

In the days of ancient civilization, trade did not assume consideration importance because of the lack of surpluses and the lack adequate transportation facilities. Early trade was limited almost entirely to people near the great natural highways of the earth and to commodities of great value per unit of weight.

Answer 36

Transportation and Communication Facilities

Question 37

If trade is legally free to move, it is because of the difference in money costs and and money prices of goods in different countries which determines their movement.

Answer 37

Price Structure