INTB 200 MIDTERM REVIEW QUESTIONS
International Business - Answers - business activities of public and private
enterprises that involve the movement of goods, services or resources across national
boundaries (raw materials, capital, and people)
Foreign Business - Answers - the operations of a firm outside of its domestic or home
market
International Company - Answers - a company with operations in more than one nation
Factors that Influence Globalization - Answers - 1. Political Climate
2. Technology
3. Markets
4. Cost
5. Competition
Political Climate - Answers - - reduced trade barriers
- increased in DFI
- a rise in NGOs
- lowering of protectionism
Protectionism - Answers - the theory or practice of shielding a country's domestic
industries from foreign competition by taxing imports.
Technology - Answers - internet, www., social media
- ease of gathering info
- *pushed companies to go to other countries*
- Reduction in transportation costs through containerization and air freight
Containerization - Answers - paying to ship by container rather than individual products
Air Freight - Answers - costs decrease: quick travel causes interest rates to decrease
because the company gets a quicker return
Markets - Answers - markets open up and companies can enter new ones and as the
companies globalize, they become global customers
- advertise, pay taxes, hire nationals, build factory, or open office
- creation of new middle classes = new customers who have a disposable income
Why would a company branch out to global markets? - Answers - - home market is
saturated
- retaliation, foreign co. enters your home market
- seasonal differences (ie. fruit)
, Cost - Answers - Economies of Scale (bring costs down)
- standardized product
- improve company's competitive advantage
- invest overseas
- access to foreign markets that are close by
- building global awareness of your product
- building worldwide distribution
DFI - Answers - direct foreign investment
Competition - Answers - Increases in intensity
- find new buyers for your products
- product is obsolete
Marketing Task - Answers - performing business activities that will direct the flow of a
company's goods or services to consumers or users in other nations
Types of Barriers to Trade - Answers - - tariff barriers
- monetary barriers
- market barriers
Types of Tariff Barriers - Answers - - ad valorem
- specific duty
- compound duty
Ad Valorem - Answers - tax that is a % of the commercial invoice value of the goods
Specific Duty - Answers - charge based on product (weight, #, etc.)
Compound Duty - Answers - combo of ad valorem and specific duties
Types of Monetary Barriers - Answers - - blocked currency
- differential exchange rate
- governmental approval
Blocked Currency - Answers - no trade/deals in this currency (country won't accept
others)
Differential Exchange Rate - Answers - higher rates for less favored products
Governmental Approval - Answers - government must grant permit for trade
Types of Market Barriers - Answers - - quotas
- embargo
- economies of scale
- documentation
International Business - Answers - business activities of public and private
enterprises that involve the movement of goods, services or resources across national
boundaries (raw materials, capital, and people)
Foreign Business - Answers - the operations of a firm outside of its domestic or home
market
International Company - Answers - a company with operations in more than one nation
Factors that Influence Globalization - Answers - 1. Political Climate
2. Technology
3. Markets
4. Cost
5. Competition
Political Climate - Answers - - reduced trade barriers
- increased in DFI
- a rise in NGOs
- lowering of protectionism
Protectionism - Answers - the theory or practice of shielding a country's domestic
industries from foreign competition by taxing imports.
Technology - Answers - internet, www., social media
- ease of gathering info
- *pushed companies to go to other countries*
- Reduction in transportation costs through containerization and air freight
Containerization - Answers - paying to ship by container rather than individual products
Air Freight - Answers - costs decrease: quick travel causes interest rates to decrease
because the company gets a quicker return
Markets - Answers - markets open up and companies can enter new ones and as the
companies globalize, they become global customers
- advertise, pay taxes, hire nationals, build factory, or open office
- creation of new middle classes = new customers who have a disposable income
Why would a company branch out to global markets? - Answers - - home market is
saturated
- retaliation, foreign co. enters your home market
- seasonal differences (ie. fruit)
, Cost - Answers - Economies of Scale (bring costs down)
- standardized product
- improve company's competitive advantage
- invest overseas
- access to foreign markets that are close by
- building global awareness of your product
- building worldwide distribution
DFI - Answers - direct foreign investment
Competition - Answers - Increases in intensity
- find new buyers for your products
- product is obsolete
Marketing Task - Answers - performing business activities that will direct the flow of a
company's goods or services to consumers or users in other nations
Types of Barriers to Trade - Answers - - tariff barriers
- monetary barriers
- market barriers
Types of Tariff Barriers - Answers - - ad valorem
- specific duty
- compound duty
Ad Valorem - Answers - tax that is a % of the commercial invoice value of the goods
Specific Duty - Answers - charge based on product (weight, #, etc.)
Compound Duty - Answers - combo of ad valorem and specific duties
Types of Monetary Barriers - Answers - - blocked currency
- differential exchange rate
- governmental approval
Blocked Currency - Answers - no trade/deals in this currency (country won't accept
others)
Differential Exchange Rate - Answers - higher rates for less favored products
Governmental Approval - Answers - government must grant permit for trade
Types of Market Barriers - Answers - - quotas
- embargo
- economies of scale
- documentation
