Intro to Business Chapter 3 Vocabulary – Flashcards
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Imports
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Items bought from other countries
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Exports
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Goods and services sold to other countries
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Balance of Trade
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Difference between a country's total exports and total imports
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Balance of Payments
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Difference between the amount of money that comes into a country and the amount that goes out of it
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Exchange Rate
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Vailue of a currency in one country compared with the value in another
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Infrastructure
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Refers to a nation's transportation, communication, and utility systems, factor that supports international trade in industrialized countries
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Trade Barriers
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Restrictions to free trade
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Quota
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Limit on the quantity of a product that may be imported or exported with a give period
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Tariff
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Tax that a government places on certain imported products
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Embargo
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Action in which the government stops the export or import of a product completely
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Multinational Company (MNC)
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An organization that does business in several countries
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Joint venture
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An agreement between two or more companies to share a business project
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Domestic business
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Making, buying, and selling of goods and service within a country
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International business
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Business activities needed for creating, shipping, and selling goods and services across national borders
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Absolute advantage
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When a country can produce a good or services at a lower cost than other countries
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Comparative advantage
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Situation in which a country specializes in the production of a good or service at which it is relatively more effiecient
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Trade surplus
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Export more than import
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Trade deficit
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Import more than export
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Free-trade zones
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A selected area where products can be imported duty-free and then stored, assembled and used in manufacturing
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Free-trade agreement
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Member countries agree to remove duties and trade barriers in product traded among them
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Common market
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Members do away with duties and other trade barriers
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Global strategy
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Uses the same product and marketing strategy worldwide
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Multinational strategy
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Treats each country market differently
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WTO
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World Trade Organization, settle trade disputes and enforces free-trade agreements between its members
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IMF
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International Monetary Fund, maintains an orderly system of world trade and exchange rates
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World bank
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Gives economic aid to less developed countries, building communications system, transportation networks, and energy plants
