IB 300 EXAM 2

Module 4: Sustainability & Natural Resources
Core Concepts

  • Environmental Sustainability:

    • Definition: Meeting present needs without compromising the ability of future generations to meet theirs [cite: 280].

    • Required Approach: It necessitates a global approach encapsulated in the saying: "Act locally, Think globally" [cite: 283, 284].

  • The Stakeholder Model:

    • Definition: A business approach aiming to consider the impact on all parties involved—including workers, families, local economies, and the environment—rather than focusing solely on shareholders and profit [cite: 332, 336, 337].

  • Natural Capital:

    • Definition: Refers to the world's stock of natural assets, encompassing land, air, water, and all living organisms [cite: 346].

Vocabulary & Tools

  • Life Cycle Assessment (LCA):

    • Definition: A method that evaluates the environmental impact of a product over its entire life cycle, including factors like $CO_2$ emissions and water usage [cite: 287].

  • Cradle-to-Cradle (C2C) Design:

    • Definition: An innovative design approach focused on ensuring that every resource used in product design can be recycled or reused, thereby closing the production loop [cite: 293].

  • Carbon Footprint:

    • Definition: The total amount of greenhouse gases, specifically $CO_2$, emitted directly or indirectly by a product or person [cite: 308].

  • Water Footprint:

    • Definition: A measure of water use that includes three components:

    • Grey water: Polluted water.

    • Blue water: Fresh surface water.

    • Green water: Rainwater [cite: 311, 312, 313, 314].

  • Renewable vs. Nonrenewable Energy:

    • Nonrenewable Energy:

    • Major Sources: Petroleum (dominant), coal (most polluting), and natural gas [cite: 368, 369, 370, 371].

    • Renewable Energy:

    • Major Sources: Wind, solar, and biomass [cite: 373, 374, 376].

Module 5: Political Forces
Core Concepts

  • Ownership Models:

    • Nationalization:

    • Definition: The process of transferring companies from private ownership to public (government) ownership, often aiming to ensure equal access to services [cite: 142, 144, 146].

    • Privatization:

    • Definition: The act of selling government-owned businesses to private investors with the objective of increasing efficiency [cite: 149, 151, 152].

    • Government Stability:

    • Importance: Business operations thrive under stable governments; instability may result from unpredictable actions, corruption, or trade wars [cite: 157, 158, 161, 162].

Trade Barriers & Restrictions

  • Dumping:

    • Definition: The practice of selling goods in foreign markets for prices below the cost of production or the home-market price [cite: 228].

  • Tariff Barriers:

    • Ad Valorem:

    • Definition: A tariff calculated as a percentage of the invoice value [cite: 239].

    • Specific Duty:

    • Definition: A fixed charge imposed on each unit of a good imported [cite: 240].

  • Nontariff Barriers (NTBs):

    • Quota:

    • Definition: A quantitative limit placed on imports to control the amount entering a market [cite: 246].

    • Voluntary Export Restraints (VERs):

    • Definition: Agreements made by a country to voluntarily limit its own exports, often under pressure from the importing country [cite: 250].

Vocabulary

  • Country Risk Assessment (CRA):

    • Definition: An evaluation tool used to assess a country’s economic and political conditions to determine the risks associated with employees and investments [cite: 189].

  • Subsidies:

    • Definition: Financial assistance provided by the government to domestic firms, which can include cash or low-cost loans [cite: 232, 233, 235].

Module 6: Legal Forces & Intellectual Property
Legal Systems

  • Civil Law:

    • Definition: A legal system based upon a formal collection of written laws, prevalent in countries such as France, China, and Germany [cite: 9, 10, 11].

  • Common Law:

    • Definition: A legal framework based on previous judicial decisions (precedents) as well as legislative statutes, as seen in countries like the US, UK, and Canada [cite: 12, 13, 14].

  • Religious Law:

    • Definition: A legal system that derives from religious precepts, including systems like Sharia Law and Jewish Halakha [cite: 16, 17, 19].

Intellectual Property (IP) Rights

  • Patents:

    • Definition: Legal rights that prevent others from making or selling an invention without authorization [cite: 74].

    • Utility Patent:

    • Duration: Protects innovative processes and inventions for a period of 20 years [cite: 76].

    • Design Patent:

    • Duration: Protects the aesthetic and non-functional aspects of a creation for 14 years [cite: 77].

  • Trademarks:

    • Definition: Signs, symbols, logos, or brand names that are used to identify a company’s products [cite: 79].

  • Copyrights:

    • Definition: Legal protections afforded to authors, software creators, and artists, granting them exclusive rights to their works [cite: 86].

  • Trade Secrets:

    • Definition: Confidential business information that provides a competitive edge, encompassing formulas, processes, or patterns—an example being the formula for Coke [cite: 85].

International Legal Concepts

  • Extraterritoriality:

    • Definition: A situation where a country seeks to enforce its laws beyond its borders, such as the application of US tax laws to citizens living abroad [cite: 40, 42].

  • Arbitration:

    • Description: A dispute resolution process that offers a quicker and less costly alternative to litigation, during which a neutral third party makes a binding decision [cite: 51].

  • Choice-of-Law Clause:

    • Definition: A contractual provision determining which country's laws will apply to a dispute [cite: 58].

  • Incoterms:

    • Definition: Standardized terms used in international trade that define the roles, risks, and costs between buyers and sellers, including terms like FOB (Free on Board) and CIF (Cost, Insurance, and Freight) [cite: 89, 90].