1. What do we mean by the term “global business”?
-Global business is all business activities needed to create, ship, and sell goods and services across national borders.
2. Name two low-risk methods for getting involved in global business.
3. Why is management contracting a safe way to get involved in global business?
-It occurs when a company sells only its management skill and does not involve obtaining a degree of control in a company or owning any assets.
4. What would be the result of war on the importing and exporting activities of the nations involved?
-The war can be considered as one of trade barriers. If nations involved in trade and negotiation are on war, their relationship would be worse and finally lead to end of the trade. It affects both nations’ economies to be worse.
Critical Thinking Questions
1. Why do companies frequently expand their business operations into other countries?
- Some nations contain certain resources or services that other nations may not have. It gives nations more opportunities to expand their business.
2. What are the benefits of doing business in other countries?
-Global business can lead nations to increase in goods that are available to us, increase sales and profits and improve political relations.
3. What are the drawbacks of doing business in other countries?
-While they work with companies from other nations, they may have problems with transportation, language and culture.
4. How are you affected by international business?
-Because international business now have expanded much enough, I can get some imported goods made in other countries, travel the countries easily and receives news from the countries.
5. What factors affect a country’s decision to trade goods and services with another country?
-If it brings more outcome than domestic business.
-If the balance between the countries can be kept.
-How much risk it requires.