CHAPTER 1 OVERVIEW OF INTERNATIONAL BUSINESS.pdf - MGT 361...

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MGT 361 InTernaTIonal BusInessChapTer 1:an overvIew of InTernaTIonal BusIness
By end of the chapter, students should be able to:Understand the meaning of International BusinessIdentifyanddescribethebasicformsofInternationalBusiness activitiesIdentify the reasons why firms doing International BusinessThe chapter objectives:
IB consists of business transactions betweenparties from more than one countryThe business transactions includes:Buying materialsin one country and shipping themto another for processing or assembly (like Applecompany)Shipping finished productsfrom one country toanother for retail sale (like high-end cars such asFerrari)Building a plantin a foreign country (Samsung)Borrowing money from banks in one country tofinance operation in anotherWhat is International Business?
IndividualInvestors and businessmenCompaniesPrivate or publicCompany ClustersAlliance, subsidiaries, associatesGovernment BodiesCentral BankInternational InstitutionWorld Bank, International Monetary FundParticipants
TransactionsIB transactions cross national boundariesLegal SystemForcing one or more countries to adjust the practices to comply withlocal lawCultureFor IB, each party needs to adjust its behaviors to meet the expectationof othersCurrencyIn IB, at least 1 party has to convert its currencies into another or bothparties using third country’s currenciesAvailability of ResourcesFor IB, natural resources are differ by countryOperation NatureIB is riskier and more complexDomesticvsInternational Business (IB)vs
Career OpportunitiesTo be prepared for a career in any facet of business worldStart own BusinessDoing business with partners from other countriesJob AssignmentWork for a firm that is owned by corporation headquarters in anothercountryTo keep pace with future competitorsTo ensure that you have global skills and knowledge to aid your careerTo keep track of latest business instrumentsIB and companies keep improving their technologies, methods,processes and skills in conducting the business, so do weCultural literacyUnderstand and appreciate the similarities and differences of variouscultural backgroundsWhy study International Business?
International Business ActivitiesImportingInternationalInvestmentLicensingFranchisingManagement ContractsExportingFDIPI
Exporting and ImportingExport: selling of products made in one’s home country for use/resale in othercountriesImport: buying of products made in other countries for sale/resale in one’scountryInternational Investment– capital supplied by residents of one country toresidents of another country. Divided into 2 categories:Foreign Direct Investment(FDI) – investment made for the purpose of controllingproperty, assets or companies located in host country. The most common FDIpractices is throughmerger and acquisition. The firms then can integrate alloperations of the acquired company with their parents company.

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Term
Spring
Professor
madam
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