International Business Essay

Review Questions2.- Why is it important for you to study international business organisation? * Almost any large organization you work for will ready international operations or be affected by the global economy. * You start your own business, you may find yourself using foreign-made materials or equipment, competing with foreign, and perhaps withal selling in foreign markets. * Keep pace with your future competitors.5.- What is portfolio investment?* Foreign portfolio investments (FPI) are purchases of foreign financial assets (stocks, bonds, and certificates of deposit) for a purpose other than control. An pillow slip of portfolio investment is the purchase of 1,000 shares of Sonys common stock by a Danish pension fund.6.- What are the basic reasons for the recent growth of international business activity? * There are two broad reasons strategic imperatives, which motivate globalization, and environmental changes, which facilitate it.Questions for Discussion5.- What are some of the differences in skills that may live on between managers in a domestic degraded and those in an international firm?Domestic firm* Local workers.* Legal system.* Local supply.International firm* Languages.* Currency* Cultures and new markets.CHAPTER 02Review Questions2.- How do differences in income levels and income distri plainlyion among countries affect international business?The most important piece of information needed by international business people about a country is its income level because it provides clues to the purchasing power of residents. One important source of income statistics is the World Bank, which divides the mans countries into high-income, middle-income, low-income categories.4.- What is keiretsu?* Japanese industry is controlled by large families of interrelated companies, that is typically centered on a major Japanese bank. The bank takes primary responsibility for confrontation the keiretsus financing needs. Members are also protected from hosti le takeovers by an elaborate system of cross-ownership of shares in which keiretsu members own shares in one anothers companies.8.- How did import substitution policies affect the economies of Brazil and Argentina? * The companies must pay higher prices for domestically produced inputs than do their foreign competitors. The government must subsidize these firms and a lot nationalize them to preserve urban jobs. The high costs of doing this are passed on to taxpayers and to consumers through higher prices, but over time the government runs a calculate deficit. The result is inflation and destruction of middle-class savings. The continent is still plagued, however, by an inability to create policies that bridge the chasm between the rich and the poor. The lack of economic and companionable mobility has trapped generation of South Ameri suffers in poverty and despairs and created political instability in many of their countries.Questions for Discussion3.- Ethnic ties, old colonial a lliances, and shared languages expect to affect international trade. Why might this be so? If true, how does this affect international business strategies regarding which markets to enter? * Its easier to do business with people who give same culture, religion, language, and is better for companies to get into these markets first.CHAPTER 03Review Questions1.- Describe the four different types of legal systems with which international business must deal. * Common law is based on the cumulative wisdom of judges decisions on individual cases through history. These cases create legal precedents, which other judges use to decide similar cases. * Civil integrity is based on a codification, or detailed listing, of what is and is not permissible. * Religious Law is based on the officially established rules governing the faith and recitation of a particular religion. * Bureaucratic Law the legal system is communist and in dictatorships is often described as bureaucratic law.9.- What is the impact of differing accounting standards on the international capital market? * Comparing the financial reports of firms from different countries is exceedingly complex, making it more difficult for international investors to assess the performance of the worlds business.10.-What is political risk? What forms can it take?* Political risks are many changes in the political environment that many adversely affect the value of a firms business activities. * Forms * Ownership risk, in which the property of a firm is threatened through confiscation or expropriation. * Operating risk, in which the on-going operations of a firm and/or the safety of its employees are threatened through changes in laws, environmental standards, tax codes, terrorism, armed insurrection, and so forth. * Transfer risk, in which the government interferes with a firms ability to shift funds into and out of the country.Questions for Discussion2.- What is the impact of vigorous enforcement of intellectual prope rty rights on the world economy? Who gains and who loses form strict enforcement of these laws? * The impact vigorous enforcement of intellectual property rights on the world economy will be very benefits for development countries but for poor countries it will be a big economic problem because they have a habit to live with piracy products, and the familiar economy cant pay for medium cost products like dvd, books, music, etc. * The real authors publishing companies will gain and mafias of piracy will lose because they live of that agreeable of work.