International Trade and Business Growth

Exporting - selling products into a foreign market

Importing - buying products from a foreign market for use in the importers home market

Division of labour - when a business makes an employee do one task, making them specialised

Specialisation - focus on producing and exporting what you have expertise on and importing products that other businesses can produce more efficiently

• Gives competitive advantage

  • Higher quality

    • Innovative - understand process over time

  • More efficient

    • Lower unit cost

    • Lower prices

    • Economies of scale

FDI - level of cross border investment over time (Direct investment excludes investment through the purchase of shares (if that purchase results in an investor controlling less than 10% of the shares of the company)) e.g. setting up operations in another country

• Growth - mergers, joint ventures

• Financial return

• Resources - labour, raw materials, components, expertise

• Access to new markets - more sales, customers

• Access new partners - joint ventures

• Job opportunities