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Globalization Markets - 🧠 ANSWER ✔✔Cross-border integration and growing
interdependency of countries around the world.
International Trade - 🧠 ANSWER ✔✔Goods and services across national borders
(through exporting and importing)
Exporting - 🧠 ANSWER ✔✔Goods and services sold abroad
Importing - 🧠 ANSWER ✔✔Products or services from suppliers located abroad
(also referred to as global sourcing)
International Portfolio Investment - 🧠 ANSWER ✔✔Passive ownership of foreign
securities such as stocks and bonds.
,Foreign Direct Investment (FDI) - 🧠 ANSWER ✔✔International strategy in which
the firm establishes a presence abroad through the acquisition of resources. An
investment in the form of a controlling ownership in a business in one country by
an entity based in another.
PESTEL analysis - 🧠 ANSWER ✔✔Engaging in international business requires
firms to choose markets carefully, with the help of a
Cross-cultural risk, country risk, currency risk, and commercial risk - 🧠 ANSWER
✔✔The Four Risk of International Business
cross-cultural risk - 🧠 ANSWER ✔✔cultural differences, negotiation patterns,
decision-making styles, and ethical practices
- 🧠 ANSWER ✔✔the harmful or unstable political system, laws, and regulations
unfavorable to foreign firms, inadequate or underdeveloped legal system
currency (financial risk) - 🧠 ANSWER ✔✔currency exposure, asset valuation,
foreign taxation, inflationary and transfer pricing
commercial risk - 🧠 ANSWER ✔✔weak partner, operational problems, timing of
entry, competitive intensity, poor execution of strategy, cyber risk, and social
media risk
, Multinational enterprise (MNE) - 🧠 ANSWER ✔✔A large company with
substantial resources that performs various business activities through a network of
subsidiaries and affiliates located in multiple countries.
Small and medium-sized enterprise - 🧠 ANSWER ✔✔Typically, companies with
500 or few employees, comprising over 90% of all firms in most countries. SMEs
increasingly engage in international business.
Born global firm - 🧠 ANSWER ✔✔A young, entrepreneurial SME that undertakes
substantial international business at or near its founding.
1.Exporting and importing
2. Turnkey projects
3. licensing
4. franchising
5. establishes joint ventures
6. or setting up a new, wholly owned subsidiary - 🧠 ANSWER ✔✔In general firms
can use of of the six market entry strategies:
exporting - 🧠 ANSWER ✔✔contract based
acquisition and greenfield - 🧠 ANSWER ✔✔subsidiary
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