International Business and Trade Overview
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Questions and Answers

Which of the following best describes international trade?

  • A local exchange of goods and services.
  • An extension of production, exchange, and consumption among different countries. (correct)
  • A simple transaction involving one country only.
  • A process limited to exports without imports.

What is a common form of complex operations in international business?

  • Joint ventures or realization of joint operations. (correct)
  • Individual entrepreneurial ventures.
  • Only online retailing.
  • Import substitution.

Which of the following is NOT included in the elements of international trade?

  • Manufacturing within a single country. (correct)
  • Production.
  • Exchange.
  • Consumption.

Direct investments in international trade typically involve which of the following?

<p>Investment in foreign markets by a company. (D)</p> Signup and view all the answers

What aspect of international trade is emphasized in duty-free zones?

<p>Facilitation of trade without import duties. (B)</p> Signup and view all the answers

What defines aggressive export marketing?

<p>Developing strategies that create a clear picture of the company’s plans. (A)</p> Signup and view all the answers

Which term describes exports carried out with the help of intermediaries?

<p>Indirect export (A)</p> Signup and view all the answers

What role do representative agents typically fulfill in export activities?

<p>They negotiate on behalf of the exporting company. (B)</p> Signup and view all the answers

Which of the following statements about passive export is correct?

<p>It relies on expected orders from foreign buyers. (A)</p> Signup and view all the answers

What primary function do foreign distributors perform?

<p>They take products from exporters and manage aftersales services. (C)</p> Signup and view all the answers

How can exporters find foreign agents or distributors?

<p>Through trade associations or chambers of commerce. (A)</p> Signup and view all the answers

What is a key advantage of direct exporting?

<p>Control over the logistics and movement of goods. (D)</p> Signup and view all the answers

Which of the following is NOT a typical source for finding foreign agents?

<p>Social media influencers (C)</p> Signup and view all the answers

What is the primary focus of international business?

<p>Facilitating the transfer of goods and services across borders (A)</p> Signup and view all the answers

Which of the following is NOT a component of international business?

<p>Local business expansion (B)</p> Signup and view all the answers

Which of these professions is likely to be involved in international business?

<p>A tax accountant specializing in international regulations (A)</p> Signup and view all the answers

What is one of the activities included in international business?

<p>Exporting goods to foreign markets (A)</p> Signup and view all the answers

In the context of international business, what is meant by 'transfer of resources'?

<p>Moving workforce between countries (C)</p> Signup and view all the answers

Who among the following authors worked on the publication related to international business?

<p>Vesna Grozdanovska (C)</p> Signup and view all the answers

Which of the following is a key characteristic of international business activities?

<p>Involves interactions between different cultures (C)</p> Signup and view all the answers

What role does the transfer of technologies play in international business?

<p>It facilitates innovation and competitive advantage (D)</p> Signup and view all the answers

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Flashcards

International Trade

The exchange of goods and services between individuals, businesses, and governments in different countries.

Direct Exporting

Selling your products directly to customers in another country, without intermediaries.

Indirect Exporting

Selling your products to customers in another country through intermediaries, such as distributors or agents.

Joint Venture

Two or more companies collaborate to create a new business entity in a foreign country.

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Foreign Direct Investment (FDI)

Investment made by a company from one country into a business enterprise in another country.

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Passive Export

Exporting where the company waits for orders from foreign buyers. They don't actively seek out customers in new markets.

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Aggressive Export Marketing

Developing strategies to actively penetrate foreign markets, presenting a clear plan and offensive approach.

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Export Agents

Intermediaries who connect exporters with foreign buyers, but don't handle the sales themselves. They help with logistics, documentation and packaging.

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Representative Agents

Agents who find buyers for the exporting company's products. They have the authority to negotiate on behalf of the company.

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Foreign Distributors

Companies that acquire the exporter's products and sell them directly to customers in the foreign market.

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Foreign Government Agents

Government agencies or representatives who can assist exporters in navigating foreign markets, identify opportunities, and facilitate export activities.

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International Business

Commercial activities that involve the movement of goods, services, resources, people, ideas, and technologies across national borders.

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What is the focus of international business?

The focus is on promoting the transfer of goods, services, resources, people, ideas, and technologies across national borders. This involves cross-border transactions and operations.

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Goods

Physical products that are traded internationally, such as cars, electronics, and clothing.

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Services

Intangible activities that are traded internationally, such as tourism, banking, and consulting.

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Resources

Raw materials and resources that countries need for production, such as oil, minerals, and energy.

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People

The movement of people across borders, often due to work, education, or migration.

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Ideas

The exchange of knowledge, technologies, and innovations between countries.

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Technologies

The transfer of technology and equipment between countries, enabling development and progress.

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Study Notes

International Business and Trade

  • International business encompasses all commercial activities across national borders, such as the transfer of goods, services, resources, people, ideas, and technologies.
  • International business takes various forms, including exporting/importing, licensing, franchising, and establishing manufacturing or sales facilities in foreign markets.
  • International trade is the exchange of goods and services between nations.
  • All countries need goods and services, but each has limited resources, necessitating trade to meet demands.
  • Countries export to utilize surplus creation and import to fulfill unmet demands.

Globalization of International Business

  • Globalization involves increased global interconnectedness and interdependence in economic, social, technological, cultural, political, and environmental spheres.
  • Globalization is associated with the increased flow of goods and services, capital, labor, and knowledge across borders.
  • Key aspects of economic globalization include:
    • Increase in national income per capita.
    • Increased employment opportunities.
    • Rise in direct investment.
    • Technological advancements due to international research and development.

International Market Traits

  • International markets vary significantly based on cultural nuances, demographics, consumer preferences, political regulations, and competition levels.
  • Market size, population demographics, demand, purchasing behavior, production costs, and regulatory frameworks influence market competitiveness.
  • Protective measures like tariffs or regulations control market entry of goods and services.

International Trade Systems

  • International trade regulations and organizations like the WTO help manage and promote global trade exchanges.
  • The WTO oversees trade agreements between countries to facilitate free movement of goods and services globally.
  • International cooperation and trade agreements are crucial for international business activities.
  • National legal frameworks and policies impact trade relations between entities.

Establishing International Business

  • Exporting, using intermediaries, joint ventures, or direct investment establish international business.
  • Exporting (direct/indirect): The seller sends or sells goods to customers in a foreign country.
  • Direct: The seller engages directly in selling to foreign buyers.
  • Indirect: The seller uses an intermediary (agents/brokers) to sell to foreign buyers.
  • Joint ventures: Two or more sides work together to accomplish goals and make profit.
  • Foreign direct investment (FDI): Investments in another country with the intention of creating operational capability.

International Trade

  • International trade encompasses the exchange of goods and services between nations.
  • The basic elements of international trade are production, exchange, and consumption.
  • Globalization and interdependence are factors influencing international trade.

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Description

This quiz covers key concepts of international business and trade, emphasizing the importance of cross-border commercial activities. It also explores globalization and its impact on economic interconnectedness and resource exchange among nations.

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