Ch. 3 - Global Business and Trade Concepts

A collection of vocabulary flashcards derived from key concepts in global business and trade.

Global Trade

The exchange of goods and services between countries.

Importing

Buying products from another country.

Exporting

Selling products to another country.

Comparative Advantage

A country should produce and sell goods it can make most efficiently, and buy those it cannot produce as effectively.

Absolute Advantage

A country has a monopoly on producing a specific product or can produce it more efficiently than all others.

Free Trade

The movement of goods and services among nations without political or economic barriers.

Tariffs

Taxes imposed on imports to protect domestic producers.

Embargo

A complete ban on the import or export of a particular product or trade with a specific country.

Foreign Direct Investment (FDI)

The buying of permanent property and businesses in foreign nations.

Multinational Corporation

An organization that manufactures and markets products in many different countries.

Joint Venture

A partnership in which two or more companies join to undertake a major project.

Cultural Differences

Variations between cultures that can affect business operations globally.

Outsourcing

The process of one firm contracting with other companies to perform functions.

Trade Deficit

When a country's imports exceed its exports.

Trade Surplus

When a country's exports exceed its imports.