IBUS Chapter 1 Quiz
Which country has seen their share of world output increase the most from 1960 to today?
China
Since World War II, globalization has been driven by two major factors: the decline in barriers to the free flow of goods, services, and capital, and technological change. Business has fueled these trends and has been the beneficiary of these trends. Understanding globalization trends helps businesses identify opportunities and threats in their environment. Understanding these trends will also make the changes much more manageable. International businesses have greater flexibility, more options, and a broader scope to consider globalization of production and globalization of markets.
Declining Trade Barriers---->Better ability to export goods Declining investment barriers----> Better ability to optimize location economies Enhances communication technologies---->Growth in E-Commerce Enhanced Transportation Technologies----> Lowered distance between countries
Since the middle of the 20th century, the international global business system has been shaped by global institutions. Countries have established these institutions to address the global issues that span their borders. The functions of these organizations have been established in international treaties. International businesses need to be aware of the functions of these organizations as they can have a profound impact on trade and commerce. It is critical for businesses to understand the responsibilities of each organization as well as the rationale for its creation.
Drag the organization to the matching description. 1. The IMF and World Bank were created in 1944 by 44 nations that met to maintain order in the international monetary system and promote economic growth.----> Bretton Woods Institutions: IMF and the World Bank 2. As much as 70 percent of its work is devoted to establishing higher standards of living, full employment, and conditions of economic and social progress and development.----> UN 3. A series of treaties that reduced barriers to trade.----> GATT 4. Primarily responsible for policing world trading system.---->WTO 5. Finance ministers and central bank governors of major economies coordinate policy on global financial crises.---->GTO
Which of these companies exemplifies the globalization of markets?
Fluffy Pillows, a U.S.-based pillow company, sells the same pillows worldwide
The merging of national markets that have historically been distinct and separate is the process of
Globalization
According to globalization supporters, what is an advantage of globalization?
Globalization helps create jobs in all countries that participate in the global trading system
What organization is often seen as the lender of last resort to nation-states whose economies are in turmoil and currencies are losing value against those of other nations?
International Monetary Fund(IMF)
What occurs according to Moore's law?
The power of microprocessor technology doubles and its cost of production falls in half every 18 months
Many influential economists, politicians, and business leaders think that a shift toward a more integrated and interdependent global economy is a good thing. There is evidence to support the theory that falling barriers to international trade and investment drive the global economy toward greater prosperity. There are, however, critics who argue against globalization. Anecdotes, evidence, and arguments can be collected to support each side of the debate. International businesses need to understand the nature of the globalization debate and observe how their own practices may act in support of, or against globalization. Understanding how each side sees the issues can lead toward better solutions to the problems caused by globalization.
Who/ What is Affected Arugments for Globalization: Producers---->More Markets to Sell in The environment----> Tougher laws lead to lower pollution rates Consumer---->More products to choose from Workers----> Development of better sills Arguments Against Globalization: Producers----> Can go bankrupt due to competition The environment----> Lack adequate regulations causes abuse Consumers---->Don't know how products are made Workers----> Loss of jobs due to competition
Which institution was established as a result of the Uruguay Round of GATT?
World Trade Organization
The labor, energy, land, and capital that a company has access to are known as
factors of production
California-based Urban Health Source has invested resources in business activities in Italy. What type of business activity does this represent?
foreign direct investment
Gigantic Games., a U.S.-based company that specializes in strategy-based board games, has production facilities in Poland and Spain. Based on this information, Gigantic Games can be classified as what type of enterprise?
multinational
When considering globalization, what is considered the single most important innovation since World War II?
the microprocessor
