WGU D080 UNIT 2 (GLOBAL)- Study Guide Questions & Answers (SCORED A+)

What is globalization? - ANSWER - the growing global economic, cultural, and political integration and interaction what business opportunities are presented by globalization? - ANSWER - economic growth, spread of technology and innovation, lower cost of products, access to new markets what are the economic effects of globalization? - ANSWER - reduces cost of manufacturing, consumers have a wider variety of goods what are the political effects of globalization? - ANSWER - reduced importance of nation-state governments (global institutions often replace or extend national functions to facilitate international agreement) what are the cultural effects of globalization? - ANSWER - increased cross-cultural contacts, decrease in the uniqueness of once-isolated communities, global domination of American culture, erasure of other cultures what are some favorable arguments for globalization? - ANSWER - spread of technology and innovation, lowered rates of poverty in developing nations what are some arguments AGAINST globalization? - ANSWER - unemployment due to jobs moving overseas for lower production costs, significant increases in inequality between business owners and common people in developed nations what are the different forms of international business? - ANSWER - 1. organizations (any company, large or small) 2. governmental organizations (embassies, consulates, NAFTA, etc.) 3. NGO's (non-governmental organizations such as non-profits and volunteer organizations - UNICEF, Greenpeace, World Wildlife Fund) what is the first stage of entering a global market? - ANSWER - market entry - companies enter new countries using business models similar to the ones deployed in their home markets. what is the second stage of entering a global market? - ANSWER - (product specialization), companies transfer the full production process of a particular product to a single, low-cost location and export the goods to various consumer markets. what is the third stage of entering a global market? - ANSWER - (value chain dis-aggregation) - companies separate the production process and focus on completing each activity in the most advantageous location. (a single product might be manufactured in several different places and assembled into final products elsewhere.) what is the fourth stage of entering a global market? - ANSWER - (value chain re-engineering) - increase cost savings by redesigning processes to suit local market conditions by substituting lower cost labor for capital. what is the fifth (and final) stage of entering a global market? - ANSWER - (creation of new markets) - market expansion (allows companies to substantially lower their sticker prices in both old and new markets and to expand demand.) what are the four drivers of globalization? - ANSWER - market, cost, competition, government how does market drive globalization? - ANSWER - As customers in different parts of the world increasingly demand similar products and services, opportunities for scale arise through the marketing of somewhat standardized offerings. (example: technology products are relatively the same no matter what location - but soft drinks may vary depending on region or culture.) how does cost drive globalization? - ANSWER - efficiency and costs vary from country to country and global firms can take advantage of this fact; opportunity to build global scale economies and the high product development costs how does competition drive globalization? - ANSWER - High levels of trade, competitive diversity, and interdependence increase the potential for industry globalization how does government drive globalization? - ANSWER - the presence or absence of favorable trade policies, technical standards, what business opportunities are presented by globalization? - ANSWER - economic growth, spread of technology and innovation, lower cost of products, access to new markets