INTERNATIONAL TRADE AND BUSINESS MODULE 1 (final na ito eme)

Globalization

is a great phenomenon. It has influenced the lives of people and the way business is conducted.

Globalization

were influenced by how other people in other parts of the world live. People emulate fashion

Globalization

is the integration of world markets and where the global economy is linked and dependent on each market

Business operations

became globalized as firms continue to explore new markets and sources of raw materials

Manufacturing plants

were located strategically in countries were resources used are available and abundant

The aspect of globalization according to Hill (2011) are many. However

in this lesson

Identified drivers of globalization

- decline in trade barriers among countries.
- technological change (Hill

Protectionist Policy

was the dominant policy of most countries of the world after the war. The aim of the protectionist policy is to favor domestic industry

Tariffs and import quotas

were used as a tool to conduct the said policy.were used as a tool to conduct the said policy.

FDI

foreign direct investment

True

raising trade barriers (in a form of high tariffs on imported goods) produced negative consequences like retaliation between trading countries whose exports these countries are blocking (Hill

true

The lowering of trade barriers by countries was a strong impetus to the theoretical realization of the globalization of markets and productions.

Technology

on the other hand

Telecommunications

creates a global audience and transportation creates a global village.

True

The inventions of the microprocessor

microprocessor

is an electronic component which is a chip found in a computer.

-It is the Central Processing Unit (CPU) of the computer which functions as the brain.

-This chip performs a variety of tasks coming from input and output devices as well as the software of the computer (Miller

satellite

refers to a machine that is launched into space and moves around Earth or another body in space

- improved the telecommunication
-help improve the reach and distribution of signals

internet

in a simple context is a large computer network where one computer network is connected to other computer networks. Hence the term is said to be a "network of networks"(Miller

World Wide Web

is a simplified information dissemination platform used for information sharing on the internet.

true

The proliferation of information was also disseminated through the provision of free Uniform Resource Locator (URL) and hypertext to the general public (Giandomenico

true

The technological changes in telecommunications have improved connections globally.

Information was processed quickly using a computer which contains a processor.

The processed information when shared can be accessed by people in the internet through email

True

Innovation in transportation technology has contributed to globalization. According to Hill (2011)

containerization

revolutionized the transportation business.

containerization

yielded efficiency gains like reduction in transportation cost and cheaper payments in shipping goods around the globe. These efficiency gains helped drive the globalization of markets and production (Hill

foreign direct investment

to spread production to optimal location and to establish a direct presence on major foreign markets.

Labor-intensive manufacturing operations

were established in developing nations where labor costs are cheaper than that of the home market.

True

The basic problem with IB operation is the fact that countries are totally different from each other.

Globalization of Markets

the merging of historically distinct and separate national markets into one huge global marketplace

globalization of production

the sourcing of goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production

direct foreign investment (FDI)

a method of investment in which a company builds a new business or buys an existing business in a foreign country

-is an investment in a businessby an investor from another country for which the foreign investorhas control over the company purchased.

World Trade Organization (WTO)

International organization derived from the General Agreement on Tariffs and Trade (GATT) that promotes free trade around the world.

-is the only global international organization dealing with the rules of trade between nations

General Agreement on Tariffs and Trade (GATT)

a 1948 agreement that established an international forum for negotiating mutual reductions in trade restrictions

International Monetary Fund (IMF)

International institution set up to maintain order in the international monetary system

four reasons for the difference in managing international business compared to domestic business.

-"Countries are different"

-The range of problems confronted by the managers of international business is wider and more complex

-"International business need to look for ways to work within the limits imposed by government intervention in the international trade and investment system"

-"International transaction involves converting money into different currencies"

True

The reasons for the difference in managing IB vs domestic business indicate the sources of complexities.

The level of difficulty in managing IB is wider because of the differences in countries with respect to culture