Intro to business chapter 3 study guide – Flashcards
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a written contract granting permission to operate a business to sell products and services in a set way.
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franchise
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the making, buying, and selling of goods and services within a country.
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domestic business
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occurs when a nation receives more money in a year than it pays out.
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positive or favorable balance of payments
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the difference between a country's total exports and total imports.
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balance of trade
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the value of a currency in one country compared with the value in another.
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exchange rate
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a strategy that treats each country market differently. Firms develop products and marketing strategies that adapt to the customs, tastes, and buying habits of a distinct national market.
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multinational strategy
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a factor that supports international trade in industrialized countries, including a nation's transportation, communication, and utility systems.
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infrastructure
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a market in which members do away with duties and other trade barriers.
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common market
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a situation where a country can produce a good or service at a lower cost than other countries.
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absolute advantage
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the accepted behaviors, customs, and values of a society.
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culture
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the amount a country owes to other countries.
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foreign debt
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restrictions to free trade.
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trade barriers
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banks that buy and sell different currencies.
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foreign exchange market
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an agreement between member countries to remove duties and trade barriers on products traded among them.
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free trade agreement
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a tax that a government places on certain imported products.
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tariff
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a situation in which a country exports (sells) more than it imports (buys).
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trade surplus
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goods and services sold to other countries.
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exports
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a situation in which a country imports (buys) more than it exports (sells).
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trade deficit
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a situation in which a country specializes in the production of a good or service at which it is relatively more efficient.
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comparative advantage
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the cost of using someone else's money.
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interest rates
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the difference between the amount of money that comes into a country and the amount that goes out of a country.
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balance of payments
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a selected area where products can be imported duty-free and then stored, assembled, and/or used in manufacturing.
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free trade zone
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a government-set limit on the quantity of a product that may be imported or exported within a given period.
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quota
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business activities needed for creating, shipping, and selling goods and services across national borders.
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international business
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a strategy that uses the same product and marketing strategy worldwide.
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global strategy
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the country in which the multinational company (MNC) places business activities.
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host country
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an action imposed by the government to stop the export or import of a product completely.
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embargo
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an organization that does business in several countries. It usually consists of a home country and divisions or separate companies in one or more host countries.
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multinational company(MNC)
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