International Trade and Product

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Feb/Spring 2013

Bachelor of Business Administration-BBA Semester 5

BB0024– Introduction to International Marketing - 4 Credits

(Book ID: BO103)

Assignment (60 Marks)

Note: Each question carries 10 Marks. Answer all the questions.

Q.1 Name and explain with suitable examples, three reasons why international marketing is more challenging than domestic marketing. [10 Marks]

Ans: Following are the three reasons why International Marketing is more challenging than domestic marketing:

1. Inflation and Price Moderation: Imports can also be highly beneficial to a country because they constitute reserve capacity for local economy. Without imports, there is no incentive for domestic firms to moderate their prices. The lack of imported product alternatives forces consumers to pay more, resulting in inflation and excessive profits for local firms.

2. Employment: Trade restrictions in US in 1930s contributed significantly to the great depression and caused widespread unemployment. Unrestricted trade, on the other hand, improves the world’s GNP and enhances employment generally for all nations.

3. Standard of Living: Trade affords countries and their citizens higher standard of living than otherwise possible. Without trade, product shortages force people to pay more for less. Trade also makes it easier for industries to specialise and gain access to raw-materials, while at the same time fostering competition and efficiency. A diffusion of innovations across national boundaries is a useful by product of international trade.

Q.2 What are the relative advantages and disadvantages of standardization and adaptation? Explain with suitable examples. [10 Marks]

Ans: Advantages of Standardization.
International uniformity has its own advantages. As people travel the World, they can be assured that wherever they go the product that they buy from you will be same and that it will have the same, standard benefits. This could mean the...
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