Int Bus Ch 1 (Globalization)

Managing an International Business

1. Countries are different 2. Wider range of problems 3. Work within limits of government intervention in the international trade and investment system. 4. Converting money into different currencies.

How many countries are recognized by the United Nations?

193

How many countries are in the world?

196

Change in World Output/Input

1960- USA 38.3 China 0 2014- USA 9.2 China 13.2

Multinational Enterprise

A firm that owns business operations in more that one country.

International Business

Any firm that engages in international trade o investment.

Internet

Backbone of the global economy. Rolls back restraints of location, scale, and time zones. Expand Global Presence. Enables enterprises to coordinate and control an internationally dispersed line of production much more efficiently.

Transportation

Commercial Jet Aircraft Containerization: Superfrieghters, drastically decreased shipping times and costs.

International Monetary Fund

Established to maintain order in the international monetary system. Lender of last resort to nations who are extremely struggling.

United Nations

International organization committed to preserving peace through international cooperation and collective security. (193 Nations)

General Agreement on Tariffs and Trade (GATT)

International treaty that commuted signatories to lowering barriers to the free flow of goods and across national borders and led to the WTO

Global Factors of Production

Labor, Management, Land, Capital, and Technology

Microprocessors and Telecommunications

Low Cost Computing of Information. Increased the amount of info that could be processed by firms.

Mini-Multinational

Medium-size and small enterprises that still have a larger international business footprint.

Role of Technology in Globalization

Microprocessors & Telecommunications Internet Transportation

Outsourcing of Healthcare

Outsourcing MRI scans to be read in other countries, speeds up process. Phillipines transcribe medical files. Outsourcing could cut health care costs by $70 Billion

World Trade Organization

Responsbile for policing the world trading system and making sure nation-states adhere to the rules laid out in the trade treaty. 162 Countries are members

Boeing

Sells worldwide International Production Gone away from naming product by where its made but rather its a world product.

World Bank

Set up to promote economic development in the world poorer nations.

Globalization of Markets

The merging of historically distinct and separate national markets into one huge global market place. Reduced barriers allow trade to be easier.

Robert Reich

The outsourcing of productive activities to different suppliers results in the creation of products that are global in nature "Global Products".

Moores Law

The power of a microprocessor technology doubles and its cost of production falls in half every 18 months.

Globalization

Trend away from distinct national economic units and toward one huge global market

International Trade

When a firm exports goods or services to consumers in another country.

Foreign Direct Investment (FDI)

When a firm invests resources in business activities outside its home country. Barriers and taxes for international trade have been dropping significantly by many countries.

Non US Multinationals

Worlds largest 100 multinationals are still dominated by firms from developed countries. US 22 UK 14 France 14 Germany 14 Japan 7