MGMT ch 5

And manager is evaluating a countries, transportation and communication systems when deciding how to enter the country's market, this manager is thinking about the countries

Infrastructure

If a country forbids residents to purchase foreign-made goods, it has passed

A "buy national" law

What is an international business?

A business based primarily in a single country, but acquire some meaningful share of its resources or revenues from other countries (Lowe's)

What is a domestic business?

A business that requires all of its resources, and sells all the products within a single country

A regionalism focus means that managers operate an internal organization as

A collection of independent business

What is a disadvantage of import/export?

A disadvantage, our taxes, transport expensive

What is a market system?

A group of countries that trade mostly with each other

What is a strategic alliance?

A long-term partnership between two or more companies established to help each company build competitive market advantages. (Starbucks and target)

What is social orientation?

A persons belief about the importance of individual versus the group, to which that person belongs

Globalization focus means that managers operate an international organization as

A single integrated system

What is a tariff?

A tax on imported goods

A set of countries that mutually agrees to reduce trade barriers among them is considered

And economic community

What is licensing?

Arrangement. Whereby one company allows another company to use it's brand name, trademark, technology, patent, copyright, or other assets in exchange for royalty based on sales

What is the Pacific Asia?

Market system in south east Asia

What are the three different elements of a global economy?

Mature market, economies in systems, high potential high growth economies, other economies

Power Orientation

Belief that people in a culture hold, the appropriateness of power and authority, differences in hierarchy, such as business organizations

What is importing?

Bringing good, services, or capital into the home country from abroad

What is a multinational business?

Business that has worldwide marketplace, from which advise, raw materials, borrows, money, where manufactures his products, and to which it sells its products (Coke)

What is a global business?

Business that transcends national boundaries, and he's not committed to a single home country, a non-national company (doesn't exist yet)

What is time orientation?

The extent to which members of culture adopt a long-term versus a short term outlook on work, life, society

What are market system?

Clusters of countries that engage in high levels of trade with one another (ex North America, US specifically trades with Canada and Mexico)

What is a quota?

Common form of trade restriction limit on the number of value of goods that can be traded (EX. Honda is allowed to import 425, 000 autos each year to the United States.)

What are the three environments to international management?

Economic, political/legal, cultural

What is a market economy?

Economy, based on private ownership of business, that allows market factors, such as supply, and demand to determine business strategy

A manager decides to purchase a factory in another country to make up product for sale there which approach is the manager using

Direct investment

What are the levels of international business?

Domestic business, international business, multinational business, and global business

What is the European union?

First and most important international market system with 27 countries

International trade agreement that first Inc. the principle of most favored nation status MFN was what

GATT, general agreement on tariffs and trade

What is the GATT?

General Agreement on Tariffs and Trade; trade agreement intended to promote international trade by reducing trade barriers, and making it easier for all nations to compete in international markets

The ability of political authority to Maine power is the aspect of

Government stability

What are the first type of international business in which a firm can get involved in

Importing and exporting

What is infrastructure

Infrastructure is school hospitals, power plants, railroads, highways, ports, communication systems, airfields, commercial, distribution systems of a country The US has all of these, but some countries lack well developed ones EX. Kenya has planned power outages.

What is an economic environment and what does it include?

It includes an economic system, natural resources, and infrastructure

What is an advantage of export/imports?

It is the easiest way of entering the market with a small outlay of capital

Maquiladoras

Light assembly plants built in northern Mexico, close to the United States border, area with workers who are willing to work at very low wages, this benefits Mexico, but there is also controversy because it is similar wages to slave labor

What is exporting?

Making a product in the firms, domestic market place and selling it in another country (Mazda, Ford, and equipment are exported)

Manager who is winning the availability of coal oil and natural gas in different countries is thinking about their

Natural resources

What is NAFTA?

North American Free Trade Agreement; agreement made by the US, Canada, and Mexico to promote trade with each other

What is a joint venture?

Special strategic alliance, in which the partner share the ownership (nestle and General Mills)

What does nationalize mean?

Taken over by national government

What is significant about the Middle East?

The middle east or oil rich in these countries defy classification as either markets or high potential high growth as their role is an oil they make much profit, but the weather conditions are so bad that oil is there only option

What are export restraint agreements?

These persuade other governments to voluntarily limit, volume or value of goods, exported, or imported (X. Japan limits, how much steel is sent to the US to avoid these tariffs or quotas

What are characteristics of high potential high-growth economies?

They have relatively poor consumers, they're infrastructure is less developed, and their currency is weak

T/F The majority of businesses that are known globally usually come outside its own country

True

What is the USMCA?

United States-Mexico-Canada Agreement; this was signed by three partner countries in 2018 and the goal was to increase exports to Mexico and Canada and replace NAFTA

What organization, promotes, fair trade policies in low trade barriers among us most of the worlds countries

WTO world trade organization

What is direct investment?

When firms headquartered in one country, build or purchase operating facilities in another country (Disney investing $4 billion to construct a theme park in China.)

When is licensing usually need it

When there is much importing and exporting going on

What is WTO?

World Trade Organization; includes 164 nations and 23 observer countries, members are required to open market and follow WTO rules (1995)

What is uncertainty orientation?

an emotional response to uncertainty and change

Goal Orientation

the manner in which people are motivated to work toward different kinds of goals, materialistic