1
Solution Manual International Business A Managerial Pers
j j j j j j
pective
An Overview of International Business
j j j j
1-1 Whatjisjinternationaljbusiness?j Howjdoesjitjdifferjfromjdomesticjbusiness?
Internationaljbusinessjinvolvesjanyjbusinessjtransactionjbetweenjpartiesjfromjmorejthanjonejco
untry.j Itjdiffersjfromjdomesticjbusinessjinjthatjinternationaljbusinessjtransactionsjcrossjnationalj
bordersjwhilejdomesticjtransactionsjdojnot.j Morejspecifically,jinternationaljbusinessjinvolvesjfor
eignjcurrencyjtransactionsjforjatjleastjonejparty,jitjmayjrequirejajcompanyjtojadjustjtojajforeignjlega
ljsystemjand/orjculture,jandjthejwayjproductsjarejproducedjorjthejtypesjofjproductsjthatjarejprod
ucedjmayjvaryjaccordingjtojthejavailabilityjofjresourcesjinjdifferentjcountries.j(LOj1.1,jAACSB:jC
ommunicationjSkills,jLearningjOutcomes:jDefinejthejfundamentaljconceptsjofjinternationaljbusi
ness)
1-2 Whyjisjitjimportantjforjyoujtojstudyjinternationaljbusiness?
Therejarejatjleastjfivejreasonsjwhyjitjisjimportantjtojstudyjinternationaljbusiness.j First,jstudentsj
willjprobablyjworkjforjajcompanyjwithjinternationaljoperationsjorjonejthatjisjaffectedjbyjthejglobalj
economy.j Second,jstudentsjmayjactuallyjworkjforjajfirmjthatjisjownedjbyjajcorporationjbasedjinj
anotherjcountry.jThird,jitjisjimportantjtojkeepjpacejwithjfuturej“competitors”j(otherjjobjseekers)jw
hojarejwelljversedjinjinternationaljbusiness.j Fourth,jitjisjimportantjtojstayjabreastjofjthejlatestjbu
sinessjtechniquesjandjtools,jwhichjmayjactuallyjbejdevelopedjoutsidejofjthejUnitedjStates.j Fina
lly,jitjisjimportantjtojavoidjculturaljilliteracy,jajlabeljgivenjtojthosejwhojarejnotjconversantjwithjthej
globaljeconomyjandjinternationaljmarketplaces.j (LOj1.2,jAACSB:jCommunicationjSkills,jLearn
ingjOutcomes:jDefinejthejfundamentaljconceptsjofjinternationaljbusiness)
1-3 Whatjarejthejbasicjformsjofjinternationaljbusinessjactivity?
Thejbasicjformsjofjinternationaljbusinessjactivityjarejimportingjandjexporting,jinternationaljinve
stments,jlicensing,jfranchising,jandjmanagementjcontracts.j Exportingjinvolvesjselling
Copyrightj©j2015jPearsonjEducation,jInc.
, 2
productsjmadejinjone’sjownjcountryjforjusejorjresalejinjotherjcountries,jwhilejimportingjinvolvesj
buyingjproductsjmadejinjotherjcountriesjforjusejorjresalejinjone’sjownjcountry.jInternationaljinve
stmentsjincludejforeignjdirectjinvestmentjandjportfoliojinvestments.j Foreignjdirectjinvestmentsja
rejinvestmentsjmadejforjthejpurposejofjactivelyjcontrollingjproperty,jassets,jorjcompaniesjlocate
djinjforeignjhostjcountries,jwhilejportfoliojinvestmentjinvolvesjthejpurchasejofjforeignjfinancialjas
sets,jsuchjasjstocks,jbonds,jandjcertificatesjofjdepositjforjpurposesjotherjthanjcontrol.j Ajlicensi
ngjagreementjallowsjajfirmjinjonejcountryjtojusejalljorjsomejofjthejintellectualjpropertyjofjajfirmjinja
notherjcountryjinjexchangejforjajroyaltyjpayment.jAjfranchisejagreementjauthorizesjajfirmjinjonejc
ountryjtojutilizejthejbrandjnames,jlogos,jandjoperatingjtechniquesjofjajfirmjinjajsecondjcountryjinj
exchangejforjajroyaltyjpayment.jManagementjcontractsjinvolvejanjagreementjinjwhichjajfirmjinjo
nejcountryjoperatesjfacilitiesjorjprovidesjotherjmanagementjservicesjtojajfirmjinjanotherjcountryjfo
rjajfee.j(LOj1.3,jAACSB:jCommunicationjSkills,jLearningjOutcomes:jDefinejthejfundamentaljcon
ceptsjofjinternationaljbusiness)
1-4 Howjdojmerchandisejexportsjandjimportsjandjservicejexportsjandjimportsjdiffer?
Merchandisejexportsjandjimportsjreferjtojtradejinjgoodsjwhilejservicejexportsjandjimportsjreferjt
ojtradejinjintangiblejproducts.j Thejformerjisjsometimesjreferredjtojasjvisiblejtradejwhilejthejlatterji
sjsometimesjreferredjtojasjinvisiblejtrade.j(LOj1.3,jAACSB:jCommunicationjSkills,jLearningjOut
comes:jDefinejthejfundamentaljconceptsjofjinternationaljbusiness)
1-5 Whatjisjportfoliojinvestment?
Portfoliojinvestmentsjinvolvejpurchasingjforeignjfinancialjassetsjsuchjasjstocks,jbonds,jandjcer
tificatesjofjdepositjforjpurposesjotherjthanjcontrol.j(LOj1.3,jAACSB:jCommunicationjSkills,jLearni
ngjOutcomes:jDefinejthejfundamentaljconceptsjofjinternationaljbusiness)
1-6 Whatjarejthejbasicjreasonsjforjthejrecentjgrowthjofjinternationaljbusinessjactivity?
Ajnumberjofjfactorsjhavejledjtojthejrecentjgrowthjofjinternationaljbusiness.jThejmorejimportantjf
actorsjincludejmarketjexpansion,jresourcejacquisition,jcompetitivejforces,jtechnologicaljchang
e,jandjsocialjchange.j Marketjexpansionjhasjledjtojgrowthjinjinternationaljbusinessjasjfirms,jfacin
gjsaturatedjdomesticjmarkets,jseekjnewjmarketjopportunitiesjinjotherjcountries.j Injsomejcases,jf
irmsjwilljalsojexpandjintojotherjmarketsjasjtheyjseekjresourcesjsuchjasjmaterials,jlabor,jand/orjc
apital.j Suchjresourcesjmayjeitherjbejscarcejorjunavailablejdomestically.j Thej competitivej force
sj thatj existj inj today’sj marketplacej alsoj encouragej the
Copyrightj©j2015jPearsonjEducation,jInc.
, 3
internationalizationjofjbusiness.jWhenjajfirm’sjcompetitorsjexpandjintojnewjmarkets,jthatjfirmjmu
stjalsojinternationalize.j Changesjinjtechnology,jparticularlyjinjareasjsuchjasjcommunications,jtr
ansportation,jandjinformationjprocessing,jarejmakingjitjincreasinglyjeasierjforjfirmsjtojcarryjoutjin
ternationaljtransactions,jthusjaddingjtojthejgrowthjofjinternationaljbusiness.j Socialjchangejisjm
akingjitjpossiblejforjfirmsjtojselljtheirjproductsjmorejeasilyjinjforeignjmarkets.j Consumersjtodayj
arejmuchjmorejawarejofjthejproductsjandjservicesjbeingjofferedjinjotherjmarkets,jandjarejtherefo
rejmorejlikelyjtojseekjoutjforeign-
madejproductsjthanjinjthejpast.j Finally,jlooserjgovernmentjtradejandjinvestmentjpoliciesjhavejm
adejitjeasierjforjinternationaljbusinessesjtojcapitalizejonjgrowthjopportunitiesjinjthejglobaljmarke
tplace.j(LOj1.4,jAACSB:jCommunicationjSkills,jLearningjOutcomes:jDiscussjtrendsjinjandjthejd
ebatejoverjglobalization)
QUESTIONSjFORjDISCUSSION
1-7 Whyjdojsomejindustriesjbecomejglobaljwhilejothersjremainjlocaljorjregional?
Therejarejajnumberjofjfactorsjthatjplayjajrolejinjdeterminingjwhichjindustriesjbecomejglobal,jwhic
hjbecomejregional,jandjwhichjremainjlocal.j Thejairlinejindustry,jforjexample,jisjconsideredjajglo
baljindustry.j Onejofjthejmainjreasonsjforjthisjstatusjisjthejcostjofjdevelopingjandjproducingjlargeja
ircraft,jcombinedjwithjmarketjsize.j Thejindustryjisj“forced”jtojbejglobaljbecausejitjmustjselljaircra
ftjtojajmarketplacejthatjisjbigjenoughjtojjustifyjthejcostsjofjdevelopingjandjbuildingjnewjjets.j Nojsi
nglejcountryjhasjajmarketjbigjenoughjtojjustifyjsuchjcosts,jthusjcompaniesjmustjseekjcustomersj
aroundjthejglobe.j Onjthejotherjhand,jthejbakeryjindustryjtendsjtojbejregionaljorjlocaljbecausejitsj
productsjtendjtojperishjveryjeasily.j Whilejimprovementsjinjtransportationjandjshippingjhavejcre
atedjajlargerjmarketplace,jforjthejmostjpart,jfirmsjinjthisjindustryjcaterjtojlocaljcustomers.j Fromjt
hisjbriefjdiscussion,jitjisjclearjthatjfactorsjsuchjasjcost,jmarketjsize,jandjproductjlifejalljplayjajrolejinj
determiningjwhichjindustriesjwilljbejglobaljandjwhichjwilljnot.j However,jitjisjimportantjtojrecognize
jthatjmanyjotherjfactorsj(forjexample,jresourcejavailability,jgovernmentjregulations,jandjsimilarit
yjofjcustomerjtaste)jalsojplayjajrolejinjthisjdetermination.j (LOj1.4,jAACSB:jAnalyticaljSkills,jLear
ningjOutcomes:jDiscussjtrendsjinjandjthejdebatejoverjglobalization)
1-8 WhatjisjthejimpactjofjthejInternetjonjinternationaljbusiness?jWhichjcompaniesjandjwhichjcoun
triesjwilljgainjasjInternetjusagejincreasesjthroughoutjthejworld?jWhichjwilljlose?
ThejInternetjhasjhadjajsignificantjimpactjonjinternationaljbusinessjinjatjleastjthreejways.jFirst,j th
ej Internetj facilitatesj internationalj tradej inj servicesj (e.g.,j banking,j education,j and
Copyrightj©j2015jPearsonjEducation,jInc.
, 4
retailing).j Second,jitjhasjhelpedjleveljthejplayingjfieldjbetweenjlargejandjsmalljfirmsjenteringjajfor
eignjmarket,jsincejevenjsmalljfirmsjcanjselljtheirjproductsjinternationallyjonjthejWeb.jThird,jthejI
nternetjcanjmakejbusiness-to-
businessjtransactionsj(e.g.,jbringingjtogetherjsuppliersjandjbuyers)jmuchjeasierjandjmorejeffici
ently.j (LOj1.4,jAACSB:jAnalyticaljSkills,jLearningjOutcomes:jDiscussjtrendsjinjandjthejdebatejo
verjglobalization)
1-9 Whichjmarketsjarejmorejimportantjtojinternationaljbusinessj–
jthejtraditionaljmarketsjofjNorthjAmerica,jthejEuropeanjUnion,jandjJapanjorjthejemergingjmarkets?j
Defendjyourjanswer.
Clearly,jthejvolumejofjbusinessjinjthejtraditionaljmarketsjisjmuchjgreaterjthanjthejvolumejinjeme
rgingjmarkets.jHowever,jasjthejtraditionaljmarketsjbecomejsaturated,jopportunitiesjforjgrowthj
willjincreasinglyjshiftjtowardjemergingjmarkets.j (LOj1.4,jAACSB:jAnalyticaljSkills,jLearningjOut
comes:jDiscussjtrendsjinjandjthejdebatejoverjglobalization)
1-10 Doesj yourj collegej orj universityj havej anyj internationalj programs?j Doesj thisj makej thejinsti
tutionjanjinternationaljorganization?jWhyjorjwhyjnot?
Studentsjwhojattendjajcollegejorjuniversityjthatjhasjinternationaljprogramsjwilljprobablyjfindjthisj
questionjinteresting.j Studentsjwhojdojnotjhavejinternationaljprogramsjavailablejtojthemjcanjstillj
findjthejquestionjworthjconsideringjifjtheyjusejajlittlejimagination.j Thejtextjdefinesjinternationaljo
rganizationsjtojincludejpublicjsectorjorganizationsjthatjcrossjnationaljborders.jWithjthisjdefinitio
njinjmind,jajcollegejorjuniversityjcouldjveryjwelljbejconsideredjanjinternationaljorganization.j Ho
wever,jitjisjimportantjtojconsiderjthejtypejofjinternationaljprogramsjanjinstitutionjhasjtojoffer.j Forj
example,jonejcouldjarguejthatjajuniversityjthatjsimplyjoffersjseveraljcoursesjthatjdealjwithjinternat
ionaljbusinessjisjnotjanjinternationaljorganizationjbecausejthejinstitutionjatjthatjpointjdoesjnotjcro
ssjbordersj(seejdefinitionjabove).j Injcontrast,jitjcouldjbejarguedjthatjajuniversityjthatjoffersjcourse
sjinjinternationaljbusinessjandjalsojoffersjajstudentjexchangejprogramjisjanjinternationaljorganiz
ationjbecausejthejmissingjelementjinjthejpreviousjexamplej(ofjcrossingjborders)jisjfulfilledjbecau
sejofjthejexchangejprogram.j Thejkeyjpointjinjthisjquestion,jtherefore,jisjtojdeterminejexactlyjwhenj
internationaljprogramsjmakejajcollegejorjuniversityjanjinternationaljorganization.j(LOj1.2,jAACS
B:jAnalyticaljSkills,jLearningjOutcomes:jDiscussjtrendsjinjandjthejdebatejoverjglobalization)
1-11 Whatjarejsomejofjthejdifferencesjinjskillsjthatjmayjexistjbetweenjmanagersjinjajdomesticjfirmja
ndjthosejinjanjinternationaljfirm?
Copyrightj©j2015jPearsonjEducation,jInc.
Solution Manual International Business A Managerial Pers
j j j j j j
pective
An Overview of International Business
j j j j
1-1 Whatjisjinternationaljbusiness?j Howjdoesjitjdifferjfromjdomesticjbusiness?
Internationaljbusinessjinvolvesjanyjbusinessjtransactionjbetweenjpartiesjfromjmorejthanjonejco
untry.j Itjdiffersjfromjdomesticjbusinessjinjthatjinternationaljbusinessjtransactionsjcrossjnationalj
bordersjwhilejdomesticjtransactionsjdojnot.j Morejspecifically,jinternationaljbusinessjinvolvesjfor
eignjcurrencyjtransactionsjforjatjleastjonejparty,jitjmayjrequirejajcompanyjtojadjustjtojajforeignjlega
ljsystemjand/orjculture,jandjthejwayjproductsjarejproducedjorjthejtypesjofjproductsjthatjarejprod
ucedjmayjvaryjaccordingjtojthejavailabilityjofjresourcesjinjdifferentjcountries.j(LOj1.1,jAACSB:jC
ommunicationjSkills,jLearningjOutcomes:jDefinejthejfundamentaljconceptsjofjinternationaljbusi
ness)
1-2 Whyjisjitjimportantjforjyoujtojstudyjinternationaljbusiness?
Therejarejatjleastjfivejreasonsjwhyjitjisjimportantjtojstudyjinternationaljbusiness.j First,jstudentsj
willjprobablyjworkjforjajcompanyjwithjinternationaljoperationsjorjonejthatjisjaffectedjbyjthejglobalj
economy.j Second,jstudentsjmayjactuallyjworkjforjajfirmjthatjisjownedjbyjajcorporationjbasedjinj
anotherjcountry.jThird,jitjisjimportantjtojkeepjpacejwithjfuturej“competitors”j(otherjjobjseekers)jw
hojarejwelljversedjinjinternationaljbusiness.j Fourth,jitjisjimportantjtojstayjabreastjofjthejlatestjbu
sinessjtechniquesjandjtools,jwhichjmayjactuallyjbejdevelopedjoutsidejofjthejUnitedjStates.j Fina
lly,jitjisjimportantjtojavoidjculturaljilliteracy,jajlabeljgivenjtojthosejwhojarejnotjconversantjwithjthej
globaljeconomyjandjinternationaljmarketplaces.j (LOj1.2,jAACSB:jCommunicationjSkills,jLearn
ingjOutcomes:jDefinejthejfundamentaljconceptsjofjinternationaljbusiness)
1-3 Whatjarejthejbasicjformsjofjinternationaljbusinessjactivity?
Thejbasicjformsjofjinternationaljbusinessjactivityjarejimportingjandjexporting,jinternationaljinve
stments,jlicensing,jfranchising,jandjmanagementjcontracts.j Exportingjinvolvesjselling
Copyrightj©j2015jPearsonjEducation,jInc.
, 2
productsjmadejinjone’sjownjcountryjforjusejorjresalejinjotherjcountries,jwhilejimportingjinvolvesj
buyingjproductsjmadejinjotherjcountriesjforjusejorjresalejinjone’sjownjcountry.jInternationaljinve
stmentsjincludejforeignjdirectjinvestmentjandjportfoliojinvestments.j Foreignjdirectjinvestmentsja
rejinvestmentsjmadejforjthejpurposejofjactivelyjcontrollingjproperty,jassets,jorjcompaniesjlocate
djinjforeignjhostjcountries,jwhilejportfoliojinvestmentjinvolvesjthejpurchasejofjforeignjfinancialjas
sets,jsuchjasjstocks,jbonds,jandjcertificatesjofjdepositjforjpurposesjotherjthanjcontrol.j Ajlicensi
ngjagreementjallowsjajfirmjinjonejcountryjtojusejalljorjsomejofjthejintellectualjpropertyjofjajfirmjinja
notherjcountryjinjexchangejforjajroyaltyjpayment.jAjfranchisejagreementjauthorizesjajfirmjinjonejc
ountryjtojutilizejthejbrandjnames,jlogos,jandjoperatingjtechniquesjofjajfirmjinjajsecondjcountryjinj
exchangejforjajroyaltyjpayment.jManagementjcontractsjinvolvejanjagreementjinjwhichjajfirmjinjo
nejcountryjoperatesjfacilitiesjorjprovidesjotherjmanagementjservicesjtojajfirmjinjanotherjcountryjfo
rjajfee.j(LOj1.3,jAACSB:jCommunicationjSkills,jLearningjOutcomes:jDefinejthejfundamentaljcon
ceptsjofjinternationaljbusiness)
1-4 Howjdojmerchandisejexportsjandjimportsjandjservicejexportsjandjimportsjdiffer?
Merchandisejexportsjandjimportsjreferjtojtradejinjgoodsjwhilejservicejexportsjandjimportsjreferjt
ojtradejinjintangiblejproducts.j Thejformerjisjsometimesjreferredjtojasjvisiblejtradejwhilejthejlatterji
sjsometimesjreferredjtojasjinvisiblejtrade.j(LOj1.3,jAACSB:jCommunicationjSkills,jLearningjOut
comes:jDefinejthejfundamentaljconceptsjofjinternationaljbusiness)
1-5 Whatjisjportfoliojinvestment?
Portfoliojinvestmentsjinvolvejpurchasingjforeignjfinancialjassetsjsuchjasjstocks,jbonds,jandjcer
tificatesjofjdepositjforjpurposesjotherjthanjcontrol.j(LOj1.3,jAACSB:jCommunicationjSkills,jLearni
ngjOutcomes:jDefinejthejfundamentaljconceptsjofjinternationaljbusiness)
1-6 Whatjarejthejbasicjreasonsjforjthejrecentjgrowthjofjinternationaljbusinessjactivity?
Ajnumberjofjfactorsjhavejledjtojthejrecentjgrowthjofjinternationaljbusiness.jThejmorejimportantjf
actorsjincludejmarketjexpansion,jresourcejacquisition,jcompetitivejforces,jtechnologicaljchang
e,jandjsocialjchange.j Marketjexpansionjhasjledjtojgrowthjinjinternationaljbusinessjasjfirms,jfacin
gjsaturatedjdomesticjmarkets,jseekjnewjmarketjopportunitiesjinjotherjcountries.j Injsomejcases,jf
irmsjwilljalsojexpandjintojotherjmarketsjasjtheyjseekjresourcesjsuchjasjmaterials,jlabor,jand/orjc
apital.j Suchjresourcesjmayjeitherjbejscarcejorjunavailablejdomestically.j Thej competitivej force
sj thatj existj inj today’sj marketplacej alsoj encouragej the
Copyrightj©j2015jPearsonjEducation,jInc.
, 3
internationalizationjofjbusiness.jWhenjajfirm’sjcompetitorsjexpandjintojnewjmarkets,jthatjfirmjmu
stjalsojinternationalize.j Changesjinjtechnology,jparticularlyjinjareasjsuchjasjcommunications,jtr
ansportation,jandjinformationjprocessing,jarejmakingjitjincreasinglyjeasierjforjfirmsjtojcarryjoutjin
ternationaljtransactions,jthusjaddingjtojthejgrowthjofjinternationaljbusiness.j Socialjchangejisjm
akingjitjpossiblejforjfirmsjtojselljtheirjproductsjmorejeasilyjinjforeignjmarkets.j Consumersjtodayj
arejmuchjmorejawarejofjthejproductsjandjservicesjbeingjofferedjinjotherjmarkets,jandjarejtherefo
rejmorejlikelyjtojseekjoutjforeign-
madejproductsjthanjinjthejpast.j Finally,jlooserjgovernmentjtradejandjinvestmentjpoliciesjhavejm
adejitjeasierjforjinternationaljbusinessesjtojcapitalizejonjgrowthjopportunitiesjinjthejglobaljmarke
tplace.j(LOj1.4,jAACSB:jCommunicationjSkills,jLearningjOutcomes:jDiscussjtrendsjinjandjthejd
ebatejoverjglobalization)
QUESTIONSjFORjDISCUSSION
1-7 Whyjdojsomejindustriesjbecomejglobaljwhilejothersjremainjlocaljorjregional?
Therejarejajnumberjofjfactorsjthatjplayjajrolejinjdeterminingjwhichjindustriesjbecomejglobal,jwhic
hjbecomejregional,jandjwhichjremainjlocal.j Thejairlinejindustry,jforjexample,jisjconsideredjajglo
baljindustry.j Onejofjthejmainjreasonsjforjthisjstatusjisjthejcostjofjdevelopingjandjproducingjlargeja
ircraft,jcombinedjwithjmarketjsize.j Thejindustryjisj“forced”jtojbejglobaljbecausejitjmustjselljaircra
ftjtojajmarketplacejthatjisjbigjenoughjtojjustifyjthejcostsjofjdevelopingjandjbuildingjnewjjets.j Nojsi
nglejcountryjhasjajmarketjbigjenoughjtojjustifyjsuchjcosts,jthusjcompaniesjmustjseekjcustomersj
aroundjthejglobe.j Onjthejotherjhand,jthejbakeryjindustryjtendsjtojbejregionaljorjlocaljbecausejitsj
productsjtendjtojperishjveryjeasily.j Whilejimprovementsjinjtransportationjandjshippingjhavejcre
atedjajlargerjmarketplace,jforjthejmostjpart,jfirmsjinjthisjindustryjcaterjtojlocaljcustomers.j Fromjt
hisjbriefjdiscussion,jitjisjclearjthatjfactorsjsuchjasjcost,jmarketjsize,jandjproductjlifejalljplayjajrolejinj
determiningjwhichjindustriesjwilljbejglobaljandjwhichjwilljnot.j However,jitjisjimportantjtojrecognize
jthatjmanyjotherjfactorsj(forjexample,jresourcejavailability,jgovernmentjregulations,jandjsimilarit
yjofjcustomerjtaste)jalsojplayjajrolejinjthisjdetermination.j (LOj1.4,jAACSB:jAnalyticaljSkills,jLear
ningjOutcomes:jDiscussjtrendsjinjandjthejdebatejoverjglobalization)
1-8 WhatjisjthejimpactjofjthejInternetjonjinternationaljbusiness?jWhichjcompaniesjandjwhichjcoun
triesjwilljgainjasjInternetjusagejincreasesjthroughoutjthejworld?jWhichjwilljlose?
ThejInternetjhasjhadjajsignificantjimpactjonjinternationaljbusinessjinjatjleastjthreejways.jFirst,j th
ej Internetj facilitatesj internationalj tradej inj servicesj (e.g.,j banking,j education,j and
Copyrightj©j2015jPearsonjEducation,jInc.
, 4
retailing).j Second,jitjhasjhelpedjleveljthejplayingjfieldjbetweenjlargejandjsmalljfirmsjenteringjajfor
eignjmarket,jsincejevenjsmalljfirmsjcanjselljtheirjproductsjinternationallyjonjthejWeb.jThird,jthejI
nternetjcanjmakejbusiness-to-
businessjtransactionsj(e.g.,jbringingjtogetherjsuppliersjandjbuyers)jmuchjeasierjandjmorejeffici
ently.j (LOj1.4,jAACSB:jAnalyticaljSkills,jLearningjOutcomes:jDiscussjtrendsjinjandjthejdebatejo
verjglobalization)
1-9 Whichjmarketsjarejmorejimportantjtojinternationaljbusinessj–
jthejtraditionaljmarketsjofjNorthjAmerica,jthejEuropeanjUnion,jandjJapanjorjthejemergingjmarkets?j
Defendjyourjanswer.
Clearly,jthejvolumejofjbusinessjinjthejtraditionaljmarketsjisjmuchjgreaterjthanjthejvolumejinjeme
rgingjmarkets.jHowever,jasjthejtraditionaljmarketsjbecomejsaturated,jopportunitiesjforjgrowthj
willjincreasinglyjshiftjtowardjemergingjmarkets.j (LOj1.4,jAACSB:jAnalyticaljSkills,jLearningjOut
comes:jDiscussjtrendsjinjandjthejdebatejoverjglobalization)
1-10 Doesj yourj collegej orj universityj havej anyj internationalj programs?j Doesj thisj makej thejinsti
tutionjanjinternationaljorganization?jWhyjorjwhyjnot?
Studentsjwhojattendjajcollegejorjuniversityjthatjhasjinternationaljprogramsjwilljprobablyjfindjthisj
questionjinteresting.j Studentsjwhojdojnotjhavejinternationaljprogramsjavailablejtojthemjcanjstillj
findjthejquestionjworthjconsideringjifjtheyjusejajlittlejimagination.j Thejtextjdefinesjinternationaljo
rganizationsjtojincludejpublicjsectorjorganizationsjthatjcrossjnationaljborders.jWithjthisjdefinitio
njinjmind,jajcollegejorjuniversityjcouldjveryjwelljbejconsideredjanjinternationaljorganization.j Ho
wever,jitjisjimportantjtojconsiderjthejtypejofjinternationaljprogramsjanjinstitutionjhasjtojoffer.j Forj
example,jonejcouldjarguejthatjajuniversityjthatjsimplyjoffersjseveraljcoursesjthatjdealjwithjinternat
ionaljbusinessjisjnotjanjinternationaljorganizationjbecausejthejinstitutionjatjthatjpointjdoesjnotjcro
ssjbordersj(seejdefinitionjabove).j Injcontrast,jitjcouldjbejarguedjthatjajuniversityjthatjoffersjcourse
sjinjinternationaljbusinessjandjalsojoffersjajstudentjexchangejprogramjisjanjinternationaljorganiz
ationjbecausejthejmissingjelementjinjthejpreviousjexamplej(ofjcrossingjborders)jisjfulfilledjbecau
sejofjthejexchangejprogram.j Thejkeyjpointjinjthisjquestion,jtherefore,jisjtojdeterminejexactlyjwhenj
internationaljprogramsjmakejajcollegejorjuniversityjanjinternationaljorganization.j(LOj1.2,jAACS
B:jAnalyticaljSkills,jLearningjOutcomes:jDiscussjtrendsjinjandjthejdebatejoverjglobalization)
1-11 Whatjarejsomejofjthejdifferencesjinjskillsjthatjmayjexistjbetweenjmanagersjinjajdomesticjfirmja
ndjthosejinjanjinternationaljfirm?
Copyrightj©j2015jPearsonjEducation,jInc.
