Introduction to Globalization

The chance of not repaying a loan. Higher risk means you pay less interest; lower risk means higher interest.

Costs that don't change, like rent or property taxes, regardless of production.

Costs that change depending on production, like utilities.

The amount a company spends to make one item.

The amount a company charges for an item.

The idea that computing power doubles while costs halve roughly every 18 months.

Spreading your investments or risks to reduce the chance of a large loss.

The cost that changes with the number of chairs produced, excluding fixed costs like property tax.

The cost that remains constant, regardless of the number of chairs produced, e.g., property tax.

External pressures that motivate companies to expand internationally.

When the supply of a product or service exceeds the demand.

Products whose demand varies significantly with the time of year.

The gap between two cultures, often measured in factors like linguistic, religious, and cultural differences.

The additional costs and risks that firms face when operating in a foreign country compared to domestic firms.

Risk of being treated unfairly or discriminated against in a foreign market due to background.

Additional expenses incurred in conducting international business transactions, including tariffs.

What we see is just our own interpretation, not necessarily objective reality.

Understanding a product's meaning and use within a different culture.

Toys serve different purposes in various cultures, from entertainment to social learning.

We unconsciously judge other cultures based on our own.

Components of a culture that shape its values, aesthetics, and language.

A group's beliefs about what is good, right, and desirable.

A culture's standards of beauty and taste in art, music, and folklore.

The actual words and pronunciation used within a culture.

Nonverbal cues, like facial expressions and gestures, that convey meaning.

Unspoken rules of behaviour that are considered unacceptable within a culture.

An economic policy aimed at enriching a nation by restricting imports and encouraging exports. It strives to create a trade surplus, where exports exceed imports, to accumulate wealth.

The absence of barriers to the free flow of goods and services between countries. It encourages open markets with minimal government intervention.

The ability of a country to produce a good more efficiently than any other country. This means they can produce more of the good with the same resources.

The value of what is given up when making a choice. It's the next best alternative you sacrifice by choosing one option over another.

The ability of a country to produce a good at a lower opportunity cost than another country. Even if a country isn't the most efficient producer overall, it can still specialize in what it's relatively better at.

A multilateral agreement aimed at liberalizing international trade by reducing tariffs and other trade barriers. It was superseded by the WTO in 1995.

Any obstacle that restricts the flow of goods and services between countries, increasing the cost of trading. These can be tariffs, quotas, or non-tariff barriers.

Selling a product in a foreign market below the cost of production or below its domestic price. This is considered an unfair trade practice.

An international organization dedicated to promoting free trade by setting rules for global commerce, settling trade disputes, and helping developing countries participate in the global economy.

A set of 10 economic policy recommendations promoted by the IMF and World Bank focusing on fiscal discipline, market liberalization, and privatization. It aimed to guide developing countries toward a market-oriented economy.

A model that tracks the stages a product goes through from introduction to decline, impacting sales strategies.

The initial stage of a product's life cycle, characterized by low sales and gradual growth.

The stage where product sales increase rapidly as consumers recognize its benefits.

The stage where sales peak and then plateau as the product reaches wide market penetration.

The final stage where product sales decline as the product loses its appeal or faces competition.