PART SIX - CONTEMPORARY ISSUES

2. PART SIX - CONTEMPORARY ISSUES International Business

3. Chapter 19 Overview • Absolute Advantage • Comparative Advantage • Exporting and Importing • Protectionism • The Rise of the Global Economy • Doing Business Globally

4. Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes • Absolute Advantage • Comparative Advantage • Exporting and Importing • Exports • Why Do Companies Export? • How Do Companies Identify Export Markets? • Imports • Imports of Materials • Imports of Consumer Goods • Thc Trade Balance • Foreign Exchange • Protectionism • Tariffs • Quotas • Embargoes

5. The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics • The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics • The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics • The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics

6. Figure 19.1 Multinational Companies 1. Imported Materials Multinational corporations may import materials used to manufacture their products. General Motors (GM), the largest automobile producer in the United States, works with more than 30,000 suppliers worldwide. Many of these suppliers are overseas. 2. International Production Multinational companies may produce their products in other countries. GM has manufacturing, assembly, or component operations in 50 countries. It operates abroad in order to improve service or reduce costs. 3. International Sales Multinational companies sell their products in other countries. GM cars and trucks are sold in Africa, Asia and the Pacific, Europe, the middle East, and North America. Foreign sales represent a significant share of the company’s total sales.

7. The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics • The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics

8. Figure 19.2 Examples of Foreign Business Practices Country Business Practice China Food is extremely important. All business transactions require at least one and usually two evening banquets. The first banquet is given by the host, the second by the guest. Indonesia Even foreigners are expected to arrive late to social occasions. It is generally appropriate to arrive about 30 minutes after the scheduled time. Singapore Businesspeople exchange business cards in a formal manner, receiving the card with both hands and studying it for a few moments before putting it away. Saudi Arabia Businesspeople greet foreigners by clasping their hand, but they do not shake hands. Switzerland Business is conducted very formally. Humor and informality are inappropriate.

9. The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics • The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics • The Rise of the Global Economy • Improvements in Telecommunication Technology • Political Changes • Free Trade Areas • Doing Business Globally • Forms of International Operations • Working through a Foreign Intermediary • Signing a Licensing Agreement with a Foreign Country • Forming a Strategic Alliance • Becoming a Multinational Corporation  • Challenges of Working in an International Environment • Understanding Foreign Cultures  • Coalitions of Cooperating Countries and Trading Blocs • Political Changes • Human Rights and Ethics

10. ? Questions