Business Management

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UNIT 1

THE WORLD OF INTERNATIONAL BUSINESS

CHAPTER 1: THE REGIONAL AND GLOBAL STRATEGY

1.-What is international business all about? In your answer be sure to include a definition of the term.

International business is the study of transactions taking place across national borders for the purpose of satisfying the needs of individuals and organizations. This study includes areas such as exporting, importing, and foreign direct investment which are really important at the moment to do business around the world.

2.-What are the two primary ways in which world trade is conducted?

The two primary ways in which world trade is conducted are export/import, depending the case or necessity, and foreign direct investment.

3.-What does international trade consist of?

International trade is the exchange ofg oods and services across international borders and is also known as exports and imports.

4.- What is the difference between international business and international trade?

Fundamentally international trade is a much narrow set of activities and consists of exports and imports (e.g. goods and services) only. 

International business is a much broader concept and includes international trade, direct foreign production or any other activity across countries conducted by an entity in managing and carrying out its operations.

5.-Will foreign direct investment increase or decrease in the current decade? Why?

It is highly likely that FDI will increase during the new millennium. One of the most compelling reasons is that FDI has been continually increasing, decade after decade, and the current decade is likely to attract even greater FDI. A second reason is that international trade is increasing on an annual basis, and FDI is an important element in this development.

6.-How important are the triad nations in promoting international commerce? Explain.

Over 90 per cent of the world’s 500 largest multinationals have their home base in...
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