1. Entrepreneurship CHAPTER 4 SECTION 1

2.  Businesses sell and buy goods and services to and from other countries.  Global economy – interconnected economies of the nations of the world  Exporting – selling and shipping of goods to another country

3.  Importing – buying or bringing in goods from other countries to sell  Two factors that have helped the global economy: 1.Reduction in trade tariffs 2.Advances in communications technology 3.World Trade Organization – global coalition of governments that makes the rules that govern international trade

4.  Trade barrier – restriction on goods entering or leaving a country  The lowering of trade barriers has increased the flow of goods among countries.  Tariff – taxes imposed by a government on imported or exported goods, although primarily on imported goods

5.  North American Free Trade Agreement – between the United States, Mexico, and Canada – opened up importing and exporting between these countries  Cultural differences mean you need to study each country before you attempt to do business  Gross Domestic Product (GDP) – total value of all goods produced during the year

6.  Asia is a growing source of products and services to the world.  In China, the gov’t controls business, and laws and regulations are fairly strict.  China is the fastest growing economy in the world.  In the past, Japan was called a closed society.

7.  Many Japanese people hold their culture in high regard.  Today, Japanese consumers consider foreign or imported products, especially clothing and fashion accessories to be highly desirable.

8.  Latin Americans tend to make buying decisions based on their family’s needs not one individual.  They choose products that will benefit the whole family.  They look at the merits of the products and do comparison shopping before they buy.

9.  In Europe, risk taking an business failure are not as accepted as they are in other parts of the world.  Europe is a difficult market to define because there is no common European culture.  Products that do well in one European country may not do well in another.

10.  Where cultural difference are small, marketing products across borders works well.  International business is different from operating a domestic business: 1.Countries differ 2.Cultural differences 3.Understand the rules of international trade 4.Movements in exchange rates