CHAPTER 6 STUDY GUIDE-MARKETING PRINCIPLES

1. CHAPTER 6 STUDY GUIDE-MARKETING PRINCIPLES

2. How can a business get involved in international trade? by importing, exporting and/or setting up shop in a foreign country. • World Trade Organization- a global coalition of 135 governments that makes the rules governing international trade.

3. Tariff- a tax on imports. • Embargo- a total ban on specific goods coming into and leaving a country

4. North American Free Trade Agreement- an international trade agreement among the United States, Canada, and Mexico. • Freight Forwarders- are licensed by the U.S. Maritime Commission to handle export details.

5. European Union encourages economic integration as a single market.

6. Figure currency exchange -Divide the cost of the item by the dollar exchange rate.

7. _Imports- are goods and services purchased from other countries.

8. _Exports- are goods and services sold to other countries.

9. Nationalize- government takes ownership of property and the owners get nothing in return.

10. Infrastructureconsists of a country's roads, energy plants and telecommunications systems.

11. _Multinationals- are large corporations that have operations in several countries.

12. A _Quota-limits either the quantity or the monetary value of a product that may be imported.

13. Mini Nationals-midsize and smaller companies that have operations in foreign countries. • Absolute Advantage- occurs when a country has special natural resources or talents that allow it to produce an item at the lowest cost possible.

14. Joint Ventures- Partnerships that allow companies to participate in another country's economy. • Customs brokers- are specialists licensed by U. S. Treasury Department who know the different laws, procedures, and tariffs.

15. Balance of Trade- is the difference in value between exports and imports of a nation. • World Trade Organization- is the agency that was created to police the General Agreement on Tariffs and Trade (GATT)

16. International Trade- is the exchange of goods and services between nations. • Customization- is the product and promotion strategy of creating new products for foreign markets.

17. Globalization- is the product and promotion strategy of keeping a product and its advertising message the same around the world. • Comparative Advantage- is the value that a nation gains by selling the goods that it produces most efficiently.

18. Three types of trade barriers are Tariffs, Quotas, and Embargoes. • Two economic factors that can discourage international trade are labor costs and infrastructure.

19. Two political factors that can discourage international trade are _political corruption and government instability. • U.S. fast food companies enter into in order to open franchises in foreign countries? Joint ventures

20. Why do nations trade with each other because they are not self-sufficient.

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