1 Chapter 4: International Business What Is International Business? A domestic transaction is the An international transaction is the These items contribute to the Benefits for Business i)iv) ii)v) iii)vi)

2 Chapter 4: International Business What Is International Business? Fill out the page 50 of the graphic organizer

3 Chapter 4: International Business What Is International Business? Benefits for Business Access to Markets By trading abroad, Canadian businesses can that are 200 times larger than those at home. Customers in other parts of the world have different needs and wants. Businesses must make ? to their products and services to be successful in other countries. A global product is a Cheaper Labour Lower prices as the result of cheap labour in other countries is the number one reason why consumers buy items made in different parts of the world.

4 Chapter 4: International Business What Is International Business? Increased Quality of Goods ? Increased Quantity ? Access to Resources ?

5 Chapter 4: International Business What Is International Business? The Five Ps of International Business All countries benefit when businesses produce specialized goods and services that appeal to consumers. International business provides increased markets for businesses and offers them a broader choice of products, services, and prices for its consumers. The Five Ps of International Business 1.P 2.P 3.P 4.P 5.P

6 Chapter 4: International Business What Is International Business? Fill out page 51 of the graphic organizer

7 Chapter 4: International Business What Is International Business? Product A country’s resources ? Price The cost of producing goods and services varies from country to country. Sometimes it may be more ___________ for Canadian businesses to produce products overseas and then ship them here to sell to consumers. Lower foreign _________________________ make it cheaper to produce products abroad rather than domestically. Proximity It may be more advantageous and profitable for some businesses to sell products and services to consumers near a neighbouring country’s border rather than to its domestic customers. For example, 80 percent of the Canadian population lives within 170 km of the American border. Therefore, many Canadian businesses trade extensively with Americans. The reverse is also true: Americans market many of their goods and services to Canada. Why ?

8 Chapter 4: International Business What Is International Business? Preference Consumers often purchase foreign goods and services based on their ? & ?, even though similar products are produced domestically. Two examples are Swiss watches and Belgium chocolates. Promotion ? makes it easy for businesses to promote their products and services internationally.

9 Chapter 4: International Business What Is International Business? Costs of International Trade The hidden or social costs often associated with international trade include offshore outsourcing, human rights or labour abuses, and environmental degradation. Environmental Degradation Sustainable development: Environmental degradation:

10 Chapter 4: International Business What Is International Business? Human Rights Issues and Labour Abuses Some workers in poor countries face labour exploitation, such as physical and sexual abuses, forced confinement, non-payment of wages, denial of food and health care, and excessive working hours. Child labour—the regular employment of boys and girls under the age of 16—is commonly practiced in poor countries where the workforce is often exploited. Offshore Outsourcing Offshore outsourcing - Some advantages include proximity to natural resources, more efficient technology, indigenous innovation, and favorable tax structures.

11 India and China: The World’s Rising Power Houses! Article #1: It’s More Than Just Call Centers Video #2: India on the Rise Video #3: Asia's rise -- How and When Article #2: Americans Make Reverse Commute - to India