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45 terms

principles of marketing chapter 3

terms
STUDY
PLAY
world trade
the flow of goods and services among different countries-the value of all the exports and imports of the world
counter trade
a type of trade in which goods are paid for with other items instead of with cash
general agreements of 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 them
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 specific goods from entering or leaving a country
tariffs
taxes on imported goods
developing countries
countries in which the economy is shifting its emphasis 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 percent of the worlds population
developed country
a country that boasts sophisticated marketing systems, strong private enterrpriise, and bountiful market potential for many goods and services
group of 8 (G8)
an informal forum of the eight 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
discrectionary 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
nationalization
when a domestci government reimburses a foreign government
expropriation
when a domestic government seizes a foreign company's assets without any reimbursement
local content rules
a form of protectionism stipulating that a certain proportion of a product must consist of components supplied by industries in the host country or economic community
U.S. Generalized System of Preferences (GSP)
a program to promote economic growth in developing countries by allowing duty-free entry of goods into the U.S.
Demographics
statistics that measure observable aspects of a population, including size, age, gender, ethnic group, income, education, occupation, an family structure
cultural values
a society's deeply held beliefs about right and wrong ways to live
collectivist cultures
cultures in which people subordinate their personal goals to those of a stable community
individual 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, what is 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 produce 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 countries
product adaptation 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 advance 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
grey 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