1. Intro to Business Chapter 3 Business in the Global Economy
3-1 International Business Basics
3-2 The Global Marketplace
3-3 International Business Organizations

2. 3-1 International Business Basics
Trade Among Nations
Domestic Business –
International Business –
Countries are ____________ and so are their economies.

3. 3-1 International Business Basics
Trade Principles
Absolute Advantage –
Comparative Advantage -

4. 3-1 International Business Basics
Trade Principles
Imports –
Exports –
Balance of Trade – the difference between a country’s total exports and imports.
Exports > Imports =
Imports > Exports =

5. 3-1 International Business Basics
Trade Principles
Money goes from country to country through __________ and _________.
Balance of Payments
Favorable – receive more money than is paid out
Unfavorable – sending more money out than it brings in

6. 3-1 International Business Basics
International Currency
Exchange Rate –
Factors affecting value
Balance of Payments
Economic Conditions
Political Stability

7. 3-2 The Global Marketplace
___________
Location
Climate
Terrain
Waterways
Natural Resources
Technology
Education
Inflation
Exchange Rate
Infrastructure
_________
Language
Family
Religion
Customs
Traditions
Food
__________ ________
Government System
Political Stability
Trade Barriers
Business Regulations
International Business Environment

8. 3-2 The Global Marketplace
International Trade Barriers
Quotas –
Tariff –
Embargo –

9. 3-2 The Global Marketplace
Encouraging International Trade
Free-Trade Zones – a selected area where products can be imported duty-free and then stored, assembled, and/or used in manufacturing; often a seaport or airport
Free-Trade Agreement – member countries agree to remove all duties (import taxes) and trade barriers on products traded among them. (Ex: NAFTA)
Common Market – members do away with duties and other trade barriers ; also called an economic community (Ex: European Union, Latin America Integration Association)

10. 3-3 International Business Organizations
Multinational Company (MNC) – an organization that does business in several countries; parent company in ________ country and separate divisions in _____country
MNC Strategies
Global Strategy –
Multinational Strategy –

11. 3-3 International Business Organizations
Entering a Global Market
Licensing –
Franchising –
Joint Venture –

12. 3-3 International Business Organizations
International Trade Organizations
World Trade Organization (WTO)
Settles trade disputes and enforces free-trade agreements
International Monetary Fund (IMF)
Promotes economic cooperation
Monitors exchange rates
World Bank
Gives economic aid to less developed countries