IB Exam 1

What are some forces of globalization?

What are some forces of globalization?

Falling barriers to trade and investment,Regional trade agreements, Technological innovation, E-commerce

What are some arguments for globalization?

• Increases wealth and efficiency in all nations

• Generates labor market flexibility in developed nations

• Advances the economies of developing nations

What are some arguments against globalization?

• Eliminates jobs in developed nations

• Lowers wages in developed nations

• Exploits workers in developing nations

What is the purpose of the GATT?

Treaty designed to promote free trade by reducing tariffs and nontariff barriers to international trade

The international trade dispute system is part of what world organization?

The World Trade Organization

What are Values?

 ideas, beliefs, and customers to which people are emotionally attached

What are attitudes?

positive or negative evaluations, feelings, and tendencies that individuals harbor toward objects or concepts

What are the core elements of cultural imperialism?

• Replacement of one’s culture traditions, folk heroes, and artifacts with substitutes from another 

• As trade and investment barriers fall, US consumer goods are moving into untapped markets

• Cultural differences can force changes to suit local culture

What religions limit the sales of certain food products?

• Islam: no pork

• Hinduism: no cows

• Judaism: no pork or shellfish, meat is stored and served separately from milk; kosher meals

What are some business practices resulting from religious beliefs?

• Chic Fila: closed on Sundays

• Judaism: selling Kosher foods

• Islam: allowing prayer 5 times a day

What is a command system?

• system in which the government owns the nation’s land, factories, and other economic resources

  • Gov makes nearly all economy related decisions

What is a mixed system

•  system in which land, factories, and other economic resources are rather equally split between private and government ownership

  • Gov controls sectors important for security and stability

What is a market system?

• most of a nation’s land, factories, and other economic resources are privately owned

  • Supply and demand determines who produces what at what prices, economic freedom (free choice, free enterprise, price flexibility)

What is totalitarianism

• imposed authority, lack of constitutional guarantees, restricted participation

  • Theocratic: political system in which a country’s religious leaders are also its political leaders

What is Pluralism?

both private and public groups need to balance each other’s power

What is Anarchism?

only individuals and private groups can preserve personal liberties

What is the U.S. legal system largely based on?

Common law: tradition, precedent, and usage

What is product liability?

Holds manufacturers, sellers, individuals, and others responsible for damage, injury, or death caused by defective products

What are the different types of CSR practices companies can employ?

• Traditional philanthropy: donating money toward a specific social cause 

• Risk management: own code of conduct

• Strategic CSR: building social responsibility into core operations to create value and build competitive advantage

What are the different philosophies of ethics and how do they differ?

• Friedman View: maximize profits

• Cultural Relativist View: adopt local ethics

  • When in rome

• Righteous moralist view: home country ethics

  • Not using child labor abroad 

• Utilitarian view: maximize good and minimize bad outcomes

International Business-

a commercial transaction that crosses borders of two or more nations

Globalization

trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies

Globalization of production

dispersal of production activities worldwide to minimize costs or maximize quality

Culture

set of values, beliefs, rules, and institutions held by a specific group of people

Brain drain

the departure of highly educated people from one profession, geographic region, or nation to another

Totalitarianism

every aspect of people’s lives must be controlled to preserve order

Theocracy

political system in which a country’s religious leaders are also its political leaders (ex: the Vatican)

Imports

purchased abroad and brought into a country

National Sovereignty

generally involves the idea that a nation-state (1) is autonomous, (2) can freely select its government, (3) cannot intervene in the affairs of other nations, (4) can control movements across its borders, and (5) can enter into binding international agreements.

Caste System

a system of social stratification in which people are born into a social ranking, or caste, with no opportunity for social mobility.

Customs

When habits or ways of behaving in specific circumstances are passed down through generations, they become customs

Social Stratification

The process of ranking people into social layers or classes

Social Mobility

the ease with which individuals can move up or down a culture’s “social ladder.”

Class System

System of social stratification in which personal ability and actions determine social status and mobility.

Lingua Franca

Third or “link” language understood by two parties who speak different native languages.

Antitrust Laws

 Laws designed to prevent companies from fixing prices, sharing markets, and gaining unfair monopoly advantages.

Patent

Property right granted to the inventor of a product or process that excludes others from making, using, or selling the invention.

Secondary Footprint

Indirect carbon dioxide emissions from the whole life cycle of products (from their manufacture to eventual breakdown).

Extranet

give distributors and suppliers access to a company’s database so they can place orders or restock inventories electronically and automatically.