International Business Study Guide PDF

Study Guide for International Business Key Terms and Definitions: 1\. International Transactions: Business activities involving exchanging goods and services across international borders. 2\. Domestic Transactions: Business activities that occur within a country's borders. 3\. Foreign Trade: Exc...

Study Guide for International Business Key Terms and Definitions: 1\. International Transactions: Business activities involving exchanging goods and services across international borders. 2\. Domestic Transactions: Business activities that occur within a country's borders. 3\. Foreign Trade: Exchanging goods and services between countries. 4\. Balance of Trade: The difference between a country\'s exports and imports. 5\. Imports: Goods and services purchased from foreign countries. 6\. Exports: Goods and services sold to foreign countries. 7\. Trade Surplus: Occurs when a country's exports exceed its imports. 8\. Trade Deficit: This occurs when a country's imports exceed its exports. 9\. Direct Exporting: Selling goods and services directly to foreign markets. 10\. Indirect Exporting: Using intermediaries (like agents or distributors) to sell goods and services internationally. 11\. Currency/Exchange Rate: The value of one currency for the purpose of conversion to another. Affects international trade. 12\. Tariffs: Taxes imposed on imported goods to make them more expensive and protect domestic industries. 13\. Excise Tax: A tax on certain goods produced or sold within a country. 14\. Non-Tariff Barriers: Restrictions that countries use to control the amount of trade across their borders other than tariffs (e.g., quotas, standards). 15\. Global Product: A product that is marketed in the same way in different countries. 16\. Global Economy: The interconnected economies of the countries around the world. 17\. Social Costs: Costs that affect society as a whole, not just individual businesses (e.g., environmental pollution). 18\. Offshore Outsourcing: The practice of relocating a business function (such as manufacturing or services) to a foreign country. 19\. Transnational: Companies that operate on a global scale, integrating operations across different countries. 20\. International Labour Organization (ILO): A United Nations agency that sets international labor standards and promotes social justice. 21\. Sustainable Development: Economic development that is conducted without depletion of natural resources. 22\. Environmental Degradation: The deterioration of the environment through depletion of resources, destruction of ecosystems, and pollution. 23\. Landed Cost: The total price of a product once it has arrived at a buyer's doorstep, including shipping, taxes, and tariffs. 24\. Trade Agreement: A treaty between two or more countries to establish trade relations. 25\. GATT (General Agreement on Tariffs and Trade): An international treaty aimed at reducing trade barriers. 26\. WTO (World Trade Organization): An intergovernmental organization that regulates international trade. 27\. NAFTA (North American Free Trade Agreement): A trade agreement between the USA, Canada, and Mexico aimed at eliminating trade barriers. 28\. Bilateral Agreement: A trade agreement between two countries. 29\. Regional Trade Agreement: An agreement among countries in a specific region to enhance trade. 30\. Trading Bloc: A group of countries that have entered into a trade agreement. 31\. G8: A group of eight major advanced economies, which includes Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States, formed to discuss and coordinate economic policy. 32\. Global Dependency: The reliance of countries on each other for goods, services, and markets. Key Concepts and Explanations: 1\. The Five P\'s of International Business: \- Product: The goods/services offered. \- Price: The cost to the consumer. \- Promotion: Marketing strategies and communications. \- Place: Distribution channels and locations. \- People: The individuals involved in the business processes, including employees and consumers. 2\. Five Benefits of International Trade: \- Access to a larger market. \- Diversification of supply sources. \- Economies of scale. \- Enhanced competitiveness. \- Increased innovation. 3\. Why is the USA Canada's Major Trading Partner?: \- Geographical proximity. \- Strong economic ties and shared values. \- NAFTA agreements enhancing trade. 4\. Reasons for Reducing Trade Barriers: \- To encourage free trade and economic growth. \- To improve consumer choice. \- To foster international cooperation and relations. \- To enhance competition and efficiency among producers. 5\. Ethical Problems Resulting from Offshore Outsourcing: \- Exploitation of labor in developing countries. \- Job losses in the home country. \- Ethical concerns about working conditions. \- Environmental impact. 6\. Characteristics of Trade in a Trade Agreement: \- Reduction of tariffs and quotas. \- Established guidelines for trade relationships. \- Provisions for dispute resolution. \- Protection of intellectual property rights. 7\. Benefits and Concerns about NAFTA: \- Benefits: Lower prices for consumers, increased exports, economic growth in member countries. \- Concerns: Job losses in certain sectors, environmental degradation, and exploitation of labor. 8\. G8 -- Countries and Purpose: \- Member countries: Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States. \- Purpose: To discuss and coordinate economic policy, addressing global economic issues. 9\. Cultural Factors When Doing Business with Other Countries: \- Understanding local customs and business practices. \- Respecting language differences and communication styles. \- Acknowledging variations in consumer behavior and expectations. \- Considering legal and regulatory environments that may affect business operations. Study Tips: \- Create flashcards for key terms and their definitions for easy memorization. \- Form study groups to discuss and quiz each other on key concepts. \- Write summaries of the benefits and concerns related to trade agreements, focusing on real-world examples. \- Explore case studies of international businesses to understand how these concepts apply in practice.