BUSI - Chapter 3 (Competing in the Global Marketplace)
Free Trade
permits people to buy and sell where they please
A company that has a global vision:
recognizes and reacts to international business opportunities
Protectionism
uses artificial barriers to protect domestic industries
What are the benefits associated with free trade and globalization?
- Productivity grows more quickly when countries produce goods and services - Global competition and cheap imports keep prices down, so inflation is less likely to stop economic growth. - An open economy spurs innovation
Balance of Payments
The difference between a country's total payments to other countries and its total receipts from other countries
Floating Exchange Rate
Currency markets operate under a system called this. This means that prices of currencies vary based upon demand and supply of that currency.
North American Free Trade Agreement
Free trade agreement among USA, Canada & Mexico. Goal = promote economic prosperity & cooperation. Created the world's largest free-trade zone.
What are exports?
Goods and services that are made in one country and sold to other countries.
Why do many people fear trade and globalization?
Many fear trade and globalization will lead to massive job losses.
Which of the following statements about dumping is true?
The U.S has passed laws to make dumping illegal.
Devaluation
The reduction of a currency's value relative to another currency.