International business exam 1 study guide Chapter 1: • International business is any commercial transaction that crosses the borders of two or more nations. • by imports—goods and services purchased abroad and brought into a country. • exports—goods and services sold abroad and sent out of a country. • Large companies from the wealthiest nations still dominate international business. But firms from emerging markets (such as Brazil, China, India, and South Africa) now vigorously compete for global market share. • Small and medium-sized companies are also increasingly active in international business, largely because of advances in technology. • A multinational corporation (MNC) is a business that has direct investments (in the form of marketing or manufacturing subsidiaries) abroad in multiple countries • the born global firm —a company that adopts a global perspective and engages in international business from or near its inception. • Globalization - trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies. Globalization is characterized by denationalization (national boundaries becoming less relevant) and is different from internationalization (entities cooperating across national boundaries). • Globalization of markets refers to the convergence in buyer preferences in markets around the world. • Globalization of production refers to the dispersal of production activities to locations that help a company achieve its cost-minimization or quality-maximization objectives for a good or service. This includes the sourcing of key production inputs (such as raw materials or products for assembly) as well as the international outsourcing of services. • Globalization of Markets • Benefits • Reduces marketing costs • Creates new market opportunities. • Levels uneven income streams: • Local buyers’ needs: • Global sustainability • Globalization of Production • Benefits • Access lower-cost workers:
• Access technical expertise: • Access production inputs: • Falling Barriers to Trade and Investment • General Agreement on Tariffs and Trade (G A T T) • World Trade Organization (W T O) • Other • International organizations • The World Bank • The International Monetary Fund (I M F) • Regional trade agreements • Trade and national output e-business (e-commerce) —the use of computer networks to purchase, sell, or exchange products; to service customers; and to collaborate with partners. E-business is making it easier for companies to make their products abroad, not simply to import and export finished goods. E-mail and videoconferencing • The Internet • Company intranets and extranets: Internal company websites and information networks ( intranets ) give employees access to company data using personal computers.
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- Fall '08
- Business, Economic system, Planned economy, nations