Solution Manual
International Business
By John Daniels
17th Edition
, PART ONE
BACKGROUND FOR INTERNATIONAL BUSINESS
Chapter 1
Globalization And International Business
Objectives
1-1 Explain Why And How The Study Of International Business (Ib) Is
Important 1-2 Understand The Relationship Between Globalization And Ib
1-3 Grasp The Forces Driving Globalization And
Ib 1-4 Discuss The Major Criticisms Of
Globalization
1-5 Assess The Major Reasons Companies Seek To Create Value By Engaging In Ib
1-6 Define And Illustrate The Different Operating Modes For Companies To
Accomplish Their International Objectives
1-7 Recognize Why National Differences In Companies' External Environments Affect How
They May Best Improve Their Ib Performance
Chapter Overview
Globalization Has Become A Major Socioeconomic Force And Topic Of Debate In The
Twenty-First Century. Chapter One Examines The Forces That Are Driving This Phenomenon,
As Well As The Often- Passionate Criticisms Of The Process. The Chapter Reviews The
Objectives That Firms Pursue When They Engage In International Business Activities And
Describes The Various Modes Of Entry That May Be Used. It Also Notes The Terminology That
Has Come Into Existence As New Types Of Organizations Have Evolved. The Chapter
Concludes With A Discussion Of The Conditions In A Company's External Environment That
May Affect Its International Operations.
Chapter Outline
Opening Case: The Globalized Business Of Sports [See Map 1.1]
Although Not Everyone Agrees That The Unbridled Globalization Of Professional Sports Is All
For The Good, The Process And Possibilities Are Definitely Far Reaching. Today's Satellite
Television Broadcasts Enable Fans To Watch Top Players And Teams In Nearly Any Sport
From Almost Anywhere On Earth. Professional Teams Scour The World To Find And Develop
The Most Talented Athletes, And Players Forsake Home Country Allegiances In Their Pursuit
Of The World's Highest Salaries. Further, The More People That Tournaments Can Attract
Through Attendance And Television, The More Money That Sponsors And Advertisers Are
,Willing To Pay—And The Greater The Likelihood That Those Sponsors And Advertisers Will
Have Business Operations That Span The Globe. In Addition, Sports And
Nonsports Companies Alike Pay Famous Athletes And Teams Generous Sums To Endorse
Their Products. Successful Teams Have Opened Shops Both Domestically And Internationally
To Sell Souvenirs Bearing Their Logos And May Make More Money On Merchandise Than
From Tv Rights And Sponsorships Combined. Most Recently, As Teams And Leagues Have
Begun To Seek Income Opportunities Outside Their Home Countries, Foreign Investors Have
Acquired A U.S. Baseball Team; Another Group Of Foreign Investors Acquired Controlling
Interest In A British Soccer (Football) Team, And The National Football League (Nfl) Of The
United States Underwrites Flag Football Games In Chinese Schools And Is Playing Some
Regular Season Nfl Games In Europe. Map 1.1 Outlines National Sports In A Variety Of
Countries And Can Be Used To Discuss How Culture Impacts Globalization.
Questions
1-1 Professional Athlete A Is A Star. Professional Athlete B Is An Average Player. How Has
The Globalization Of Professional Sports Affected Each Of These Both Positively And
Negatively?
Being A Star, Professional Athlete A Can Become A Target For Endorsement Deals From
Local And International Companies And Organizations That Would Use Such An Athlete
In Advertising. They Also Get Substantial Financial Contracts (Salaries And Bonuses)
From Their Clubs. The Endorsements And Salary Deals Get More Lucrative If Professional
Athlete A Reaches Strong Positive Visibility In Major Sport Events Or If He/She Develops
A Global Brand Such As Cristiano Ronaldo. Advertisers Will Pay Them Considerably For
Endorsing A Product Or Service. However, The Same Athlete Might Be Dropped If
His/Her Performance Decline Or If Scandals Damage His/Her Image.
For The Average Player Such As Professional Athlete B, Professional Sports Globalization
Has Afforded Them Higher Salaries Than Before. Globalization Has Led To A Rise In
Professional Sports Interest And Viewership And, Consequently, Robust Growth In
Professional Athletes' Salaries. At The Same Time, The Fierce Competition Between
Athletes And The Growing Demands From Clubs And Fans Have Put Intense Pressure On
Athletes To Perform Regularly. Today's Athletes Have Little Room For Mistakes. (Lo1-2:
Understand The Relationship Between Globalization And Ib, Aacsb: Analytical Skills).
1-2 As You Read The Chapter, Identify And Show An Example Of Each International
Mode Of Operations That Is Illustrated In The Globalization Of Professional Sports.
Sport Is A Major Source Of Service Exports And Imports. Countries Compete To Organize
Major Global Events Such As The World Cup Or The Olympics For Many Business And
Political Reasons. Chief Among Them Is Tourism. Let's Say That Some American Fans Fly
On Qatar Airlines To Watch The Upcoming World Cup In Qatar In 2022. Their Travel
Expenses In Qatar Are Service Exports For Qatar And Service Imports For The U.S. (Lo1-
2: Understand The Relationship Between Globalization And Ib, Aacsb: Analytical Skills).
, Teaching Tips: Carefully Review The Powerpoint Slides For Chapter One. A Good
Internet Source Of Information On Globalization Can Be Found At
Http://Www.Globalization101.Org/. Finally, Review The Atlas Provided In The Text,
Where You Will Find Maps Of The World And Its Continents, As Well As A Country
Index.
I. The Why, What, And How Of Studying International Business (Ib)
A. Why Study Ib?
Nearly All Organizations Compete Abroad, Compete Domestically Against Foreign Or
Domestic Companies With International Operations, And/Or Use Inputs From Foreign
Suppliers. Thus, Most Managers Should Consider Ib When Setting Their Operating
Strategies And Practices. Even If You Don't Anticipate Direct Ib Activities,
Understanding The Subject Matter Will Likely Prove Useful.
Studying Ib Is Essential Because:
• Most Organizations Are Either International Or Compete With
International Companies,
• Modes Of Operations May Differ From Those Used Domestically,
• It Helps Managers To Decide Where To Find Resources And To Sell,
• The Best Way Of Conducting Business May Differ By Country,
• An Understanding Helps You Make Better Career Decisions, And
• An Understanding Helps You Decide What Governmental Policies To Support.
B. What To Study In Ib
In General, An Organization's International Operations Depend On Making Sense Of
Operating Environments And Developing The Means To Achieve Its Objectives:
1. Operating Environment: Physical, Institutional, And Competitive Conditions
Differ Among Countries; These Differences Inevitably Affect The Optimum Ways
To Do Business.
2. Operations Of Ib: Companies Operating Internationally Engage Different Modes
Of Business, Such As Exporting And Importing.
II. The Relationship Between Globalization And Ib
Globalization Is The Widening And Deepening Of Interdependent Relationships Among
People From Different Nations. The Term Sometimes Refers To The Elimination Of
Barriers To International Movements Of Goods, Services, Capital, Technology, And People
That Influence The Integration Of World Economies.
A. How Does Ib Fit In?
Ib Consists Of All Commercial Transactions (Including Sales, Investments, And
Transportation) Between Two Or More Countries.
The Relation To Globalization. The Global Connections Between Supplies And
Markets Result From The Activities Of International Business (Ib). Private
Companies Undertake Such Transactions For Profit; Governments May Undertake
Them Either For Profit Or For Other Reasons.
International Business
By John Daniels
17th Edition
, PART ONE
BACKGROUND FOR INTERNATIONAL BUSINESS
Chapter 1
Globalization And International Business
Objectives
1-1 Explain Why And How The Study Of International Business (Ib) Is
Important 1-2 Understand The Relationship Between Globalization And Ib
1-3 Grasp The Forces Driving Globalization And
Ib 1-4 Discuss The Major Criticisms Of
Globalization
1-5 Assess The Major Reasons Companies Seek To Create Value By Engaging In Ib
1-6 Define And Illustrate The Different Operating Modes For Companies To
Accomplish Their International Objectives
1-7 Recognize Why National Differences In Companies' External Environments Affect How
They May Best Improve Their Ib Performance
Chapter Overview
Globalization Has Become A Major Socioeconomic Force And Topic Of Debate In The
Twenty-First Century. Chapter One Examines The Forces That Are Driving This Phenomenon,
As Well As The Often- Passionate Criticisms Of The Process. The Chapter Reviews The
Objectives That Firms Pursue When They Engage In International Business Activities And
Describes The Various Modes Of Entry That May Be Used. It Also Notes The Terminology That
Has Come Into Existence As New Types Of Organizations Have Evolved. The Chapter
Concludes With A Discussion Of The Conditions In A Company's External Environment That
May Affect Its International Operations.
Chapter Outline
Opening Case: The Globalized Business Of Sports [See Map 1.1]
Although Not Everyone Agrees That The Unbridled Globalization Of Professional Sports Is All
For The Good, The Process And Possibilities Are Definitely Far Reaching. Today's Satellite
Television Broadcasts Enable Fans To Watch Top Players And Teams In Nearly Any Sport
From Almost Anywhere On Earth. Professional Teams Scour The World To Find And Develop
The Most Talented Athletes, And Players Forsake Home Country Allegiances In Their Pursuit
Of The World's Highest Salaries. Further, The More People That Tournaments Can Attract
Through Attendance And Television, The More Money That Sponsors And Advertisers Are
,Willing To Pay—And The Greater The Likelihood That Those Sponsors And Advertisers Will
Have Business Operations That Span The Globe. In Addition, Sports And
Nonsports Companies Alike Pay Famous Athletes And Teams Generous Sums To Endorse
Their Products. Successful Teams Have Opened Shops Both Domestically And Internationally
To Sell Souvenirs Bearing Their Logos And May Make More Money On Merchandise Than
From Tv Rights And Sponsorships Combined. Most Recently, As Teams And Leagues Have
Begun To Seek Income Opportunities Outside Their Home Countries, Foreign Investors Have
Acquired A U.S. Baseball Team; Another Group Of Foreign Investors Acquired Controlling
Interest In A British Soccer (Football) Team, And The National Football League (Nfl) Of The
United States Underwrites Flag Football Games In Chinese Schools And Is Playing Some
Regular Season Nfl Games In Europe. Map 1.1 Outlines National Sports In A Variety Of
Countries And Can Be Used To Discuss How Culture Impacts Globalization.
Questions
1-1 Professional Athlete A Is A Star. Professional Athlete B Is An Average Player. How Has
The Globalization Of Professional Sports Affected Each Of These Both Positively And
Negatively?
Being A Star, Professional Athlete A Can Become A Target For Endorsement Deals From
Local And International Companies And Organizations That Would Use Such An Athlete
In Advertising. They Also Get Substantial Financial Contracts (Salaries And Bonuses)
From Their Clubs. The Endorsements And Salary Deals Get More Lucrative If Professional
Athlete A Reaches Strong Positive Visibility In Major Sport Events Or If He/She Develops
A Global Brand Such As Cristiano Ronaldo. Advertisers Will Pay Them Considerably For
Endorsing A Product Or Service. However, The Same Athlete Might Be Dropped If
His/Her Performance Decline Or If Scandals Damage His/Her Image.
For The Average Player Such As Professional Athlete B, Professional Sports Globalization
Has Afforded Them Higher Salaries Than Before. Globalization Has Led To A Rise In
Professional Sports Interest And Viewership And, Consequently, Robust Growth In
Professional Athletes' Salaries. At The Same Time, The Fierce Competition Between
Athletes And The Growing Demands From Clubs And Fans Have Put Intense Pressure On
Athletes To Perform Regularly. Today's Athletes Have Little Room For Mistakes. (Lo1-2:
Understand The Relationship Between Globalization And Ib, Aacsb: Analytical Skills).
1-2 As You Read The Chapter, Identify And Show An Example Of Each International
Mode Of Operations That Is Illustrated In The Globalization Of Professional Sports.
Sport Is A Major Source Of Service Exports And Imports. Countries Compete To Organize
Major Global Events Such As The World Cup Or The Olympics For Many Business And
Political Reasons. Chief Among Them Is Tourism. Let's Say That Some American Fans Fly
On Qatar Airlines To Watch The Upcoming World Cup In Qatar In 2022. Their Travel
Expenses In Qatar Are Service Exports For Qatar And Service Imports For The U.S. (Lo1-
2: Understand The Relationship Between Globalization And Ib, Aacsb: Analytical Skills).
, Teaching Tips: Carefully Review The Powerpoint Slides For Chapter One. A Good
Internet Source Of Information On Globalization Can Be Found At
Http://Www.Globalization101.Org/. Finally, Review The Atlas Provided In The Text,
Where You Will Find Maps Of The World And Its Continents, As Well As A Country
Index.
I. The Why, What, And How Of Studying International Business (Ib)
A. Why Study Ib?
Nearly All Organizations Compete Abroad, Compete Domestically Against Foreign Or
Domestic Companies With International Operations, And/Or Use Inputs From Foreign
Suppliers. Thus, Most Managers Should Consider Ib When Setting Their Operating
Strategies And Practices. Even If You Don't Anticipate Direct Ib Activities,
Understanding The Subject Matter Will Likely Prove Useful.
Studying Ib Is Essential Because:
• Most Organizations Are Either International Or Compete With
International Companies,
• Modes Of Operations May Differ From Those Used Domestically,
• It Helps Managers To Decide Where To Find Resources And To Sell,
• The Best Way Of Conducting Business May Differ By Country,
• An Understanding Helps You Make Better Career Decisions, And
• An Understanding Helps You Decide What Governmental Policies To Support.
B. What To Study In Ib
In General, An Organization's International Operations Depend On Making Sense Of
Operating Environments And Developing The Means To Achieve Its Objectives:
1. Operating Environment: Physical, Institutional, And Competitive Conditions
Differ Among Countries; These Differences Inevitably Affect The Optimum Ways
To Do Business.
2. Operations Of Ib: Companies Operating Internationally Engage Different Modes
Of Business, Such As Exporting And Importing.
II. The Relationship Between Globalization And Ib
Globalization Is The Widening And Deepening Of Interdependent Relationships Among
People From Different Nations. The Term Sometimes Refers To The Elimination Of
Barriers To International Movements Of Goods, Services, Capital, Technology, And People
That Influence The Integration Of World Economies.
A. How Does Ib Fit In?
Ib Consists Of All Commercial Transactions (Including Sales, Investments, And
Transportation) Between Two Or More Countries.
The Relation To Globalization. The Global Connections Between Supplies And
Markets Result From The Activities Of International Business (Ib). Private
Companies Undertake Such Transactions For Profit; Governments May Undertake
Them Either For Profit Or For Other Reasons.
