The Global Context of Business Flashcards
Globalisation
process by which the world economy is becoming a single interdependent system
Import
product made or grown abroad but sold domestically
Export
product made or grown domestically but shipped and sold abroad
North American Free Trade Agreement (NAFTA)
agreement to gradually eliminate tariffs and other trade barriers among the United States, Canada, and Mexico
European Union (EU)
agreement among major European nations to eliminate or make uniform most trade barriers affecting group members
Association of Southeast Asian Nations (ASEAN)
organisation for economic, political, social, and cultural cooperation among Southeast Asian nations
General Agreement on Tariffs and Trade (GATT)
international trade agreement to encourage the multilateral reduction or elimination of trade barriers
World Trade Organisation (WTO)
organisation through which member nations negotiate trade agreements and resolve disputes about trade policies and practices
Balance of Trade
economic value of all products a country exports minus the economic value of all products it imports
Trade Deficit
situation in which a country’s imports exceed its exports, creating a negative balance of trade
Trade Surplus
situation in which a country’s exports exceed its imports, creating a positive balance of trade
Exchange Rate
rate at which the currency of one nation can be exchanged for the currency of another nation
Absolute Advantage
the ability to produce something that is cheaper or of higher quality than any other country can
Comparative Advantage
the ability to produce some products more efficiently than others
National Competitive Advantage
International competitive advantage stemming from a combination of factor conditions, demand conditions, related and supporting industries, and firm strategies, structures, and rivalries
