The changing profile of global business environment

A _________ exists when private enterprise reserves the right to own property and monitor the production and distribution of goods and services while the state simply supports competition and efficient practices:

• Command Economy

• Market Economy

• Mixed Economy

________: subcontracting or contracting out of activities to endogenous organizations that had previously been performed by the firm.?

• Offshoring

• Globalization

• Outsourcing

• Internationalization

Major theories of the firm’s international expansion

• 1.-International

  Trade Theory

  2.-FDI

  3.-Product Life

  Cycle

• 1.-Open economy

  2.- GDP

  3.- Productivity

• 1.-Economies of scale

  2.- MCS

  3.- Standardized product

increasing Interdependency Among Nations, Diminishing Effectiveness of National Borders and developing Countries Attitude Toward FDI are examples of Changes in Global Business Environment

• True

• False

Theorists of free trade believe that free world trade will create inequality and high costs due to interconnectivity of economies

• True

• False

Hoping to duplicate the success achieved by Japan, Korea, and other Asian nations, many developing countries are:

• subcontracting or contracting out activities to endogenous organizations

• adopting an export-oriented strategy of economic growth.

• Increasing Demand for Capital

Internalization advantages refer...

• to justify the choice of investment location

• to the advantages that MNCs can gain by directly controlling their value-creation activities

• to move production to low-cost countries.