Rajeev Global Business Exam 1 Questions and Answers 2024

Globalization - is the shift toward a more integrated and interdependent economy globalization of production versus markets, drivers, debate, critics - the tendency among many firms to source goods and services from different locations around the globe in an attempt to take advantage of national differences in the cost and quality of factors of production (such as land, labor, capital, and energy), thereby allowing them to compete more effectively against their rivals. Examples: Boeing Lenovo MNE - Multinational enterprise. A global firm that has corporate units located in foreign countries. Mini-multinationals are - are small or medium sizes companies that are working in multiple countries Difference between international and domestic business - Domestic business is when buying and selling happens within a country. International business is when buying and selling occurs outside a country's borders. Global institutions such as UN, IMF, World Bank, WTO - World Trade Organization (WTO): responsible for policing the world trading system and ensuring that nations adhere to the rules established in WTO treaties International Monetary Fund (IMF): maintains order in the international monetary system World Bank: promotes economic development United Nations (UN): maintains international peace and security, develops friendly relations among nations, cooperates in solving international problems and promotes respect for human rights, and is a center for harmonizing the actions of nations Foreign Direct Investment - the investing of resources and business activities outside a firm's home country Stock versus flow concept - stock (total cumulative value of foreign investments) generated by rich industrial countries has been on a steady decline. Stock is what you have at a certain time, like the amount of money or goods you own. Flow is how things change over time, like the movement of money or goods between places. Political economy - is the system of government in a nation. can be assessed according to: the degree to which they emphasize collectivism as opposed to individualism the degree to which they are democratic or totalitarian Market - the goods and services that a country produces, and the quantity in which they are produced is determined by supply and demand Capitalism - People own stuff and make money by buying, selling, and trading things freely. communism - Everyone shares everything, no private ownership. Economic growth - an increase in the capacity of an economy to produce goods and services, compared from one period of time to another