Globalization and Trade Barriers
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Questions and Answers

What is the primary concept of globalization?

  • Connecting different parts of the world (correct)
  • Local economic activities
  • International business transactions
  • Trade regulations

How does globalization differ from international business?

  • Globalization is solely about trade
  • There is no difference; they are synonymous
  • Globalization is a broader concept involving various connections (correct)
  • International business focuses only on cultural exchange

What role does technology play in globalization?

  • It facilitates the movement of ideas and goods (correct)
  • It creates cultural barriers
  • It hinders communication
  • It slows down international trade

Which of the following describes globalization's impact on consumers?

<p>Easier access to a variety of products (D)</p> Signup and view all the answers

Which of the following could be considered a negative impact of globalization?

<p>Economic disparities between countries (B)</p> Signup and view all the answers

How can interdependence be understood in relation to globalization?

<p>Countries depend on each other for resources and goods (B)</p> Signup and view all the answers

Which statement reflects a critical perspective on globalization?

<p>Globalization leads to uniform cultural practices (A)</p> Signup and view all the answers

What is an essential effect of globalization on local economies?

<p>Increased exposure to global market trends (C)</p> Signup and view all the answers

What is the primary purpose of trade quotas?

<p>To limit the quantity of imports (A)</p> Signup and view all the answers

What distinguishes a trade embargo from a trade sanction?

<p>An embargo bans all goods with a specific country while sanctions restrict certain goods (C)</p> Signup and view all the answers

What is the goal of foreign investment restrictions?

<p>To protect local industries and jobs (A)</p> Signup and view all the answers

How can currency fluctuations impact international trade?

<p>By altering the cost of imports and exports (A)</p> Signup and view all the answers

Which of the following is NOT considered a trade barrier?

<p>Standardization of products (A)</p> Signup and view all the answers

In what way does globalization affect market competition among international businesses?

<p>By increasing access to global markets (A)</p> Signup and view all the answers

What should international businesses focus on regarding political stability when evaluating foreign investment?

<p>An analysis of political risk assessments (D)</p> Signup and view all the answers

Which factor is essential to analyze when creating a market entry strategy?

<p>Local consumer behavior and preferences (B)</p> Signup and view all the answers

What is a direct effect of protectionist policies on international business relationships?

<p>They create barriers that can lead to trade disputes. (C)</p> Signup and view all the answers

What might contribute to a significant increase in GDP while keeping prices stable?

<p>Increased consumer spending. (D)</p> Signup and view all the answers

Which economic policy is likely to be evaluated if a government aims to control high inflation rates?

<p>Raising interest rates. (B)</p> Signup and view all the answers

If a country transitions from a manufacturing to a service-based economy, which economic indicator might initially decrease?

<p>GDP per capita. (C)</p> Signup and view all the answers

When analyzing a trade agreement's impact, which factor should be considered?

<p>The social, economic, and environmental effects on all stakeholders. (B)</p> Signup and view all the answers

What is the primary ethical consideration for management when choosing to outsource to a supplier with known labor violations?

<p>The potential impact on the company reputation. (A)</p> Signup and view all the answers

Which of the following is a potential benefit of fair trade practices in impoverished communities?

<p>Greater market access for local producers. (D)</p> Signup and view all the answers

What is a likely negative consequence of implementing high protectionist measures?

<p>Higher prices for consumers due to tariffs. (A)</p> Signup and view all the answers

What role do trade organizations typically play in the resolution of trade disputes?

<p>They act as mediators and provide arbitration services (A)</p> Signup and view all the answers

Which ethical considerations are essential when choosing a supplier?

<p>Labor practices and compliance with local laws (B)</p> Signup and view all the answers

How can the choice of ethical suppliers impact a company's brand image?

<p>It can enhance brand reputation and customer loyalty (C)</p> Signup and view all the answers

What is a primary criticism of globalization in terms of cultural impact?

<p>It promotes cultural homogenization (D)</p> Signup and view all the answers

In what way can globalization affect local businesses negatively?

<p>Local businesses may lose market share (B)</p> Signup and view all the answers

How can NGOs support microcredit programs effectively?

<p>By offering financial literacy training (C)</p> Signup and view all the answers

What is a challenge NGOs might face in delivering microcredit programs?

<p>Limited access to remote communities (A)</p> Signup and view all the answers

What might be a consequence of the cultural homogenization due to globalization?

<p>Standardization of consumer preferences (C)</p> Signup and view all the answers

How can fair trade practices create social change in impoverished communities?

<p>By ensuring fair wages and better working conditions (D)</p> Signup and view all the answers

What is the most likely long-term effect of environmental damage caused by industrial pollution?

<p>Decrease in biodiversity (C)</p> Signup and view all the answers

What should companies prioritize to create a sustainable business model and mitigate their ethical footprint?

<p>Implementing eco-friendly practices (A)</p> Signup and view all the answers

What should a company primarily assess when evaluating potential business partners in a foreign market?

<p>Ethical standards and practices (C)</p> Signup and view all the answers

How can multinational corporations best apply the principle of fairness in international trade?

<p>By respecting labor rights in all countries (C)</p> Signup and view all the answers

Which perspective is most important when assessing the ethical implications of bribery in international business?

<p>The impact on global reputation (D)</p> Signup and view all the answers

Which factor is essential for businesses to analyze when entering a foreign market to ensure ethical practices?

<p>Cultural differences (D)</p> Signup and view all the answers

What role does fair trade play in the context of global commerce?

<p>It seeks to create equitable trade conditions. (B)</p> Signup and view all the answers

Flashcards

Globalization primary concept

Connecting different parts of the world through various interactions like trade, cultural exchange and technology.

Globalization vs. International Business

Globalization is a broader concept encompassing various connections (economic, cultural, technological), while International Business is focused on business transactions between countries.

Technology's role in Globalization

Technology facilitates the movement of goods, ideas, and information across borders, accelerating globalization.

Globalization's consumer impact

Globalization leads to increased product variety and easier access to goods for consumers.

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Negative impact of Globalization

Unequal distribution of wealth and economic disparities between countries.

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Globalization & Interdependence

Countries rely on each other for resources, goods, and services, creating interdependence.

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Critical perspective on Globalization

Views Globalization negatively, arguing it creates cultural uniformity.

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Trade barriers

Obstacles like tariffs, quotas, and regulations that limit trade between countries.

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Trade Quotas

Limits on the quantity of imported goods.

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Trade Embargo

A complete ban on trade with a specific country for all or certain goods.

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Foreign Investment Restrictions

Rules that limit or control the amount and ways foreign companies can invest in a country.

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Currency Fluctuations

Changes in the value of a currency compared to others.

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Trade Barrier - Standardization

Implementing standards that can act as an indirect or subtle trade barrier.

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Globalization's effect on Market Competition

Increases market access and competition through global markets and eliminates barriers.

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Political Stability and Foreign Investment

International businesses base decisions on political risk assessments and the stability of the region.

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Market Entry Strategy

Analyzing the local consumer base and preferences is crucial to succeed.

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Protectionist policy impact

Protectionist policies create barriers to international trade, often leading to trade disputes and reduced collaboration between nations.

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GDP increase & stable prices

Increased consumer spending is a key factor behind a significant GDP increase while maintaining stable prices.

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High inflation solution

Raising interest rates is a common approach to control high inflation.

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Shifting from manufacturing

A country shifting to a service-based economy might see a decrease in GDP per capita initially.

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Trade agreement analysis

When analyzing a trade agreement, consider all social, economic, and environmental impacts on stakeholders.

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Ethical outsourcing decision

When faced with outsourcing choices, a company should prioritize the potential impact on its reputation.

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Fair trade & social change

Fair trade practices can positively impact impoverished communities by improving their social and economic conditions.

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Economic policy for inflation

Governments might adjust interest rates to manage inflation.

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Fair Trade Practices

Practices that ensure fair wages and better working conditions for producers, specifically in impoverished communities, during trade.

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Sustainable Business Model

A business model that prioritizes eco-friendly practices to minimize harm to the environment.

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Ethical Footprint

The environmental and social impact of a company's business activities.

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Ethical Standards and Practices (Business Partners)

Crucial criteria when evaluating potential business partners in foreign markets; emphasizes ethical considerations rather than just financial stability.

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Fairness in International Trade

The practice of multinational corporations respecting labor rights in all countries involved in international trade.

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Ethical Implications of Bribery

Assessing bribery's impact on a company's global reputation, focusing on broader societal consequences.

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Entering Foreign Market

Analyzing cultural differences to ensure a company's ethical practices align with local customs during expansion into a new market.

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Environmental Damage Impact - Industrial Pollution

Assessing the consequences of industrial pollution on biodiversity, the variety of life in a particular ecosystem.

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Trade Dispute Resolution

Trade organizations often mediate and arbitrate trade disputes between nations.

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Ethical Supplier Consideration

When choosing suppliers, consider their labor practices, environmental impact, and legal compliance.

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Cultural Homogenization

Globalization can spread a dominant culture, impacting local businesses and traditions.

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NGO Support for Microcredit

NGOs help with microcredit programs by educating borrowers and providing loan distribution in remote areas.

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Ethical Sourcing Effects

Choosing ethical suppliers helps improve reputation and build long-term customer loyalty.

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Globalization & Cultural Loss

Globalization might lead to a loss of local businesses and cultural identity.

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Microcredit Challenges

NGOs may face challenges like reaching underserved communities and ensuring financial literacy.

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Ethical Outsourcing Decisions

Companies should think carefully about the impact of outsourcing decisions on their reputation, employee welfare and the community.

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Study Notes

Globalization

  • Globalization is the connecting of different parts of the world through international business transactions.
  • Globalization is a broader concept than international business, encompassing various connections, not just trade.
  • Technology facilitates the movement of ideas and goods, contributing to globalization.

Trade Barriers

  • Trade barriers, like tariffs and quotas, limit the quantity of imports, increasing prices.
  • A trade embargo completely blocks trade with a specific country, while trade sanctions restrict certain goods.
  • Protectionist policies can lead to trade disputes and limit the economic growth of all involved parties.
  • Globalization's impact on consumers includes increased access to a variety of products but there can also be limited product choices, increased local market prices and a reduction in quality.

Ethics in Business

  • Ethical considerations in international business should include the consideration of the impact trade agreements have on all stakeholders (social, economic, and environmental)
  • Factors to consider when assessing ethical implications of partnering with a foreign supplier: labor practices, environmental impact, and compliance with local laws
  • Businesses must be conscious of the cultural differences and local laws
  • Choosing ethical suppliers builds a good company reputation and improves customer loyalty.

Economic Factors

  • High GDP growth with stable prices can be a result of increased consumer spending.
  • Government policies aimed at controlling inflation often involve raising interest rates.
  • A shift in economy from manufacturing to service-based economy can initially negatively impact the GDP per capita.

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BBB4M International Business Midterm Review PDF

Description

Explore the concepts of globalization and trade barriers in this quiz. Understand how international business transactions connect the world and the impact of trade policies. Test your knowledge on the ethical considerations in global business dealings.

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