Ch. 3
Order by
53 terms
Terms | Definitions |
|---|---|
 world trade | the flow of goods and services among different countries - the value of the exports and imports of the world's nations |
| countertrade | a type of trade in which goods are paid for with other items instead of with cash |
| General Agreement on Tariffs and Trade (GATT) | international treaty to reduce import tax levels and trade restrictions |
| World Trade Organization (WTO) | an organization that replaced GATT; the WTO sets trade rules for its member nations and mediates disputes between nations |
| protectionism | a policy adopted by a government to give domestic companies an advantage |
| import quotas | limitations set by a government on the amount of a product allowed to enter or leave a country |
| embargo | a quota completely prohibiting a specified goods from entering or leaving a country |
| tariffs | taxes on imported goods |
| economic communities | groups of countries that band together to promote trade among themselves and to make it easier for member nations to compete elsewhere |
| gross domestic product (GDP) | the total dollar value of goods and services produced by a nation within its borders in a year |
| Gross National Product (GNP) | the value of all goods and services produces by a country's citizens or organizations, whether located within the country's borders or not |
| economic infrastructure | the quality of a country's distribution, financial, and communications systems |
| level of economic development | the broader economic picture of a country |
| standard of living | an indicator of the average quality and quantity of goods and services consumed in a country. |
| least developed country (LDC) | a country at the lowest stage of economic development |
| developing countries | countries in which its economy is shifting from agriculture to industry |
| BRIC countries | refers to Brazil, Russia, India, and China, the largest and fastest growing of the developing countries with over 40% of the world's population |
| developed country | a country that boasts sophisticated marketing systems, strong private enterprise, and bountiful market potential for many goods and services |
| group of 8 (G8) | an informal forum of the 8 most economically developed countries that meets annually to discuss major economic and political issues facing the international community |
| business cycle | the overall patterns of change in the economy - including periods of prosperity, recession, depression, and recovery - that affect consumer and business purchasing power |
| competitive intelligence (CI) | the process of gathering and analyzing publicly available information about rivals |
| discretionary income | the portion of income people have left over after paying for necessities such as housing, utilities, food, and clothing |
| product competition | when firms offering different products compete to satisfy the same consumer needs and wants |
| brand competition | when firms offering similar goods or services compete on the basis of their brands reputation or perceived benefits |
| monopoly | a market situation in which one firm, the only supplier of a particular product is able to control the price, quality, and supply of that product |
| oligopoly | a market structure in which a relatively small number of sellers, each holding a substantial share of the market, compete in a market with many buyers |
| monopolistic competition | a market structure in which many firms, each having slightly different products, offer unique consumer benefits |
| perfect competition | a market structure in which many small sellers, all of whom offer similar products, are unable to have an impact on the quality, price, or supply of a product |
| patent | a legal mechanism to prevent competitors from producing or selling an invention, aimed at reducing or eliminating competition in a market for a period of time |
| nationalization | when a domestic government reimburses a foreign company (often not for the full value) for its assets after taking over |
| expropriation | when a domestic government seizes a foreign companies assets without reimbursement |
| local content rules | a form of protection stipulating that a certain proportion of a product must consist of components supplied by industries in the host country or economic community |
| demographics | statistics that measure observable aspects of a population, including size, age, gender, ethnic group, income, education, occupation, and family structure |
| US Generalized System of Preferences (GSP) | a program to promote economic growth in developing countries by allowing duty-free entry of goods into the US |
| cultural values | a society's deeply held belief's about right and wrong ways to live |
| collectivist cultures | cultures in which people subordinate their personal goals to those of a stable community |
| individualist cultures | cultures in which people tend to attach more importance to personal goals than to those of the larger community |
| social norms | specific rules dictating what is right or wrong, acceptable or unacceptable |
| ethnocentrism | the tendency to prefer products or people of one's own culture |
| bribery | when someone voluntarily offers payment to get an illegal advantage |
| extortion | when someone in authority extracts payment under duress |
| export merchants | intermediaries a firm uses to represent it in other countries |
| licensing agreement | an agreement in which one firm gives another firm the right to produce and market its product in a specific country or region in return for royalties |
| franchising | a form of licensing involving the right to adapt an entire system of doing business |
| strategic alliance | relationship developed between a firm seeking a deeper commitment to a foreign market and a domestic firm in the target country |
| joint venture | a strategic alliance in which a new entity owned by two or more firms allows the partners to pool their resources for common goals |
| straight extension strategy | product strategy in which a firm offers the same product in both domestic and foreign markets |
| product adaption strategy | product strategy in which a firm offers a similar but modified product in foreign markets |
| product invention strategy | product strategy in which a firm develops a new product for foreign markets |
| backward invention strategy | product strategy in which a firm develops a less advanced product to serve the needs of people living in countries without electricity or other elements of a developed infrastructure |
| free trade zones | designated areas where foreign companies can warehouse goods without paying taxes or customs duties until they move the goods into the marketplace |
| gray market goods | items manufactured outside a country and then imported without the consent of the trademark holder |
| dumping | a company tries to get a toehold in a foreign market by pricing its products lower than it offers them at home |
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