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Understanding Bus3
Chapter 3
| Question | Answer |
|---|---|
| Buying products from another country | Importing |
| Selling products to another country | Exporting |
| The US is the _______ importing nation and the ________ exporting nation? | highest and second highest |
| The movement of goods and services among nations without political or economic barriers | free trade |
| A country should sell to other countries those products that it produces most effectively and efficiently and buy what other countries produce effectively and efficiently | comparative advantage |
| A country that has a monopoly on producing a specific product or is able to produce it more efficiently than all other countries | absolute advantage |
| the total value of a nations exports compared to its imports measured over a particular period of time | balance of trade |
| A company exports exceeds their imports | trade surplus |
| The difference between money coming into a country and money leaving the country plus money flows from other factors such as tourism, foreign aid, military expenditures, and foreign investment | balance of payments |
| Having more money flowing into a country than out of the country | favorable balance of trade |
| Having more money flowing out of a country than in | trade deficit |
| selling products in a foreign country at lower prices than those charged in the producing country | dumping |
| A firm allows a foreign company to produce its product in exchange for a fee or royalty | licensing |
| Giving the rights to use the business name and sell a product or service in a given territory | Franchising |
| A foreign company produces private-label goods to which a domestic company then attaches its own brand name or trademark | contract manufacturing |
| A partnership in which two or more companies join to undertake a major project | joint venture |
| a long term partnership between two or more companies established to help each company build competitive market advantages | strategic alliances |
| the buying of permanent property and businesses in foreign nations | foreign direct investment |
| a company owned in a foreign country by another company (parent company) | foreign subsidiary |
| an organization that manufactures and markets products in man different countries and has multinational stock ownership and multinational management | multinational corporation |
| investment funds controlled by governments holding large stakes in foreign companies | sovereign wealth funds |
| lowering the value of a nation's currency relative to other currencies | devaluation |
| a complex form of bartering in which several countries may be involved each trading goods for goods or services for services | countertrading |
| the use of government regulations to limit the imports of goods and services | trrade protectionism |
| believing that a nation must export more than they import | mercantilism |
| taxes on imports | tariffs |
| omits the number of product in certain categories a nation can import | import quota |
| a complete ban on the import or export of a certain product or the stopping of all trade in a country | embargo |
| 1948 agreement that established an inter nation forum for negotiating mutual reductions in trade restrictions | GATT general agreement on tariffs and trade |
| international organization that replaced GATT and assigned the duty to mediate trade disputes among nations | WTO World trade organizations |
| A regional group of countries with a common external tariff, no internal tariffs, and coordinated laws to facilitate exchange among members | common markets |
| agreement that created free trade between the US, canada, and mexico | NAFTA |
| agreement that created free trade with Costa Rica, the Dominican Republic, El Salvador, Guatamala, Honduras, and Nicaragua | CAFTA |
| Less-strategic tasks can be sent elsewhere so the company can focus on growing more efficient consumers benefit from lower prices | pros of offshore outsourcing |
| jobs are lost permanently reduces product quality communication challenges | cons of offshore outsourcing |
Created by:
kellyderbes
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