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Description
Flashcards by sarahmegan, updated more than 1 year ago
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Created by sarahmegan
almost 8 years ago
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| Question | Answer |
| trade liberalisation | refers to price of reducing barriers to trade so economies can move gradually closer to no trade barriers at all |
| extension strategy | aimed at extending the life of a product either by making small changes, finding new uses for it, or finding new markets |
| offshoring | locating production in a foreign country. objective is to exploit cost savings, most often lower wages |
| common markets | have completely free trade internally and a single unified policy covering all member countries' trade with the rest of the world |
| trade creation | occurs when there is an increase in the total amount of goods and services traded because of reduced trade restrictions in a trading bloc |
| backward innovation | involves developing low cost products that will appeal to people with relatively low incomes |
| PPP | (purchasing power parity) a way of adjusting monetary values to allow for differences in price between countries |
| human development index (HDI) | is a measure of development based on access to health care and education as well as national income. (includes quantitative as well as qualitative aspects of development) |
| commodities | raw materials or semi-manufactured products that are traded in bulk and don't originate from any particular business. e.g. iron ore / cotton |
| specialisation | means that people (or an economy) make the most of their skills by concentrating on what they do best |
| absolute advantage | exists if the real resource cost of a product is lower in one country than another |
| comparative advantage | states if two countries each specialise in the product with the lowest opportunity cost, then trade, real incomes will increase for both countries |
| corporate culture | is the set of important assumptions that are shared by people working in a particular business and influence the ways in which decisions are taken there |
| corporate social responsibility | making decisions that takes into account all stakeholders' interests e.g. avoiding pollution |
| social/cultural differences | come from the fact individual societies (and groups within them) may have a distinctive way of life |
| protectionism | term for government policies aimed at protecting the domestic economy from effects of imports that might otherwise damage domestic industries and reduce employment |
| quota | physical limit on the amount of specific imports in one year |
| globalisation | process through which an increasingly free flow of ideas, goods, people, services and capital lead to the integration of economies of scale |
| uncertainty | relates to possibilities that cannot be quantified and may appear without warning. a new product for example could threaten a business at any time. peoples opinions of a product could change at any time |
| diversifying | means selling more than one product, or the same product in more than one market |
| inorganic growth | occurs when a business expands by taking over or merging with another company |
| horizontal integration | involves a merger or takeover where both firms are in the same line of production |
| vertical integration | joining together of two businesses which have specialised in different parts of the production process |
| synergy | idea that after a merger or takeover, the performance of a combined enterprise will exceed that of its previously separate parts. the idea that 2+2=5 |
| glocalisation | global + local. emphasise the idea that a global product or service is more likely to succeed if its adapted to specific requirements of local practices and cultural expectations |
| ethnocentric model | approach based on looking at the world from perspective of one's own culture |
| geocentric approach | effort is made to develop integrated world market strategies to gain the best from both of the strands - world and similarities/differences in domestic/foreign markets |
| polycentric model | approach that considers each host country to be unique |
| subcultures | groups of people who have interests and values in common |
| cultural imperialism | artificially injecting the culture of one society into another |
| transfer pricing | when one part of an MNC in one country transfers (sells) goods or services to another part in another country |
| race to the bottom | phase used to describe the way MNC's move to the country that offers the lowest tax rates or weakest environmental costs |
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