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Questions and Answers
What does international business refer to?
What are the three major objectives of international business?
Increasing sales, acquiring resources & knowledge, reducing risk
Why do organizations engage in international business?
To increase sales, acquire resources & knowledge, and reduce risk
International business involves only local market trades.
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Organizations engage in international business to acquire ______ and knowledge.
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What is the purpose of tariffs in international trade?
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Operating internationally can help reduce risks associated with operating in just one market.
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What is mercantilism in the context of international trade?
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What does it mean to have a global operation in international business?
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Study Notes
International Business Definition & Context
- International business encompasses cross-border economic activities.
- It involves trade, investments, and transportation between two or more countries.
- It aims to expand sales, acquire resources, and reduce risk associated with a single market.
Why Companies Engage in International Business
- Increased Sales: Companies seek new markets with higher earning potential.
- Acquiring Resources & Knowledge: Access to cheaper resources, higher-quality goods and services, and innovative ideas.
- Reducing Risk: Diversifying business operations across multiple markets reduces the impact of economic downturns.
Three Major Objectives of International Business
- Increasing Sales: Organizations enter foreign markets to maximize profits.
- Acquiring Resources & Knowledge: International engagement provides access to global resources, talent, and expertise.
- Reducing Risk: Operating globally diversifies business operations and reduces dependence on a single market.
Mercantilism and Barriers to International Trade
- Mercantilism promoted national self-sufficiency by imposing tariffs on imports.
- Tariffs were used to discourage imports and generate government revenue.
- This policy aimed to protect domestic industries and maximize national wealth.
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Description
This quiz explores the definition, context, and objectives of international business. It covers key motivations for companies engaging in cross-border activities such as increasing sales, acquiring resources, and reducing risks. Test your understanding of the global marketplace and its dynamics.
