Mkt CHp6

United States, China, Japan, Western Europe, and Canada

These countries account for two-thirds of world trade.

Trade Feedback Effect

A concept highlighting how imports affect exports and vice versa, creating a complimentary economic flow.

Countertrade

The use of barter rather than currency in global transactions.

Gross Domestic Product (GDP)

A measure of total value of goods and services produced within a country.

Balance of Trade

The difference between a nation’s exports and imports.

Protectionism

Shielding domestic industries through tariffs and quotas.

World Trade Organization (WTO)

An organization that regulates global trade and resolves disputes among member countries.

European Union (EU)

A trade bloc of 27 countries that eliminates trade barriers among members and uses a common currency, the Euro.

United States-Mexico-Canada Agreement (USMCA)

A trade agreement that updates trade practices that were previously in NAFTA.

Global Competition

A market dynamic in which firms operate, produce, and market on a worldwide scale.

International Firms

Companies that extend their home-country strategies abroad.

Multinational Firms

Firms that adapt their products to each country's market (multidomestic marketing strategy).

Transnational Firms

Companies that focus on global markets with standardized products (global marketing strategy).

Digital Globalization

The use of the internet to enable businesses to expand their operations globally.

Economic Espionage

Illegal collection of trade secrets which costs U.S. firms approximately $600 billion a year.

Cross-Cultural Analysis

Understanding similarities and differences among various national cultures.

Values

Socially preferred behaviors that persist over time, influencing culture.

Customs

The normal and expected behaviors within a specific country.

Cultural Symbols

Symbols representing ideas/concepts; semiotics studies the cultural meaning of these symbols.

Back Translation

A method to avoid misinterpretations in different languages by translating back to the original language.

Consumer Ethnocentrism

The belief that purchasing foreign-made products is wrong.

Currency Exchange Rates

The price of one country’s currency in terms of another.

Political Stability

The condition that affects trade, which can be disrupted by war, terrorism, or unstable governments.

Direct Exporting

Selling products directly to foreign customers.

Licensing

Allowing foreign firms to produce/sell products in exchange for fees or royalties.

Joint Venture

An arrangement where foreign and local companies share ownership of a business.

Direct Investment

Owning a foreign subsidiary for full control over business operations.

Product Extension

Selling the same product in different countries without modification.

Product Adaptation

Modifying a product to meet the needs of different markets.

Product Invention

Developing new products specifically for global consumers.

Gray Market

Unauthorized sales through different channels, often at prices differing from standard retail.

Dumping

Selling products below cost to undercut competition.

Key Cultural Elements

The essential aspects such as values, customs, and symbols that define a culture.

Economic Infrastructure

The foundation of transportation, financial systems, and distribution channels within a country.

Trade Regulations

Rules governing how trade is conducted and how businesses operate in a country.

Foreign Corrupt Practices Act (1977)

A U.S. law that prohibits bribery of foreign officials.

Global Brand

A brand marketed under the same name in multiple countries.

Tariffs

Taxes on imported goods imposed by governments.

Quotas

Restrictions on the quantity of a product that can enter or leave a country.

Trade War

A conflict arising from countries imposing trade restrictions against each other.

Economic Integration

A process where countries decrease trade barriers to increase economic cooperation.