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International Business -Multinational Corporations

International Business -Multinational Corporations. Student Target: be able to define multinational corporations and identify their products as imports or exports. BMW. Munich, Germany. Toyota. Toyota City, Japan. Coca-Cola. Atlanta, GA; USA. Adidas. Herzogenaurach, Germany. Puma.

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International Business -Multinational Corporations

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  1. International Business-Multinational Corporations Student Target: be able to define multinational corporations and identify their products as imports or exports.

  2. BMW • Munich, Germany

  3. Toyota • Toyota City, Japan

  4. Coca-Cola • Atlanta, GA; USA

  5. Adidas • Herzogenaurach, Germany

  6. Puma • Herzogenaurach, Germany

  7. McDonalds • Oak Brook, IL; USA

  8. Nike • Beaverton, OR; USA

  9. Hyundai • Seoul, South Korea

  10. Giorgio Armani • Milan, Italy

  11. Red Bull • Salzberg, Austria

  12. Sony • Tokyo, Japan

  13. Siemens • Munich, Germany

  14. Isuzu • Tokyo, Japan

  15. Shell (Royal Dutch Shell) • The Hague, The Netherlands

  16. British Petroleum • London, England

  17. DeBeers • Southdale, South Africa

  18. Cadbury Schweppes • London, England

  19. Louis Vuitton • Paris France

  20. Qantas Airlines: • Sydney, Australia

  21. WAL-MART • Bentonville, Arkansas; USA

  22. Volkswagen • Wolfsburg, Germany

  23. Accenture • Largest consulting business in the world • Hamilton, Bermuda

  24. Juan Valdez Cafes • Bogota, Colombia

  25. Bayer • Barmen, Germany

  26. PEPSI • New York City, NY; USA

  27. Why Global? • Profit!! • Changes in the domestic market • New or larger markets in other countries • Lower production costs abroad • Treaties or trading blocs

  28. Imports & Exports • Selling products or services to buyers in another country is known as: _____________ • ____________ refers to buying goods and services made in a foreign country. • How is a product deemed an import or export if parts are made in several different countries? • If _____% of the product is made in the U.S. it can be labeled “Made in the U.S.A.” EXPORT IMPORT 51

  29. Import or Export? 1. Boeing (U.S.) makes and sells planes to Qantas (Australia) Airlines • Import for Qantas/Australia; Export for Boeing/U.S. 2. CDW (U.S.) purchases Acer (Taiwan) laptops. • Import for CDW/U.S.; Export for Acer/Taiwan 3. Mitsubishi Endeavors sold to car dealerships in Tokyo. • Import for Car Dealerships/Japan; Export for Mitsubishi/U.S.

  30. Governmental Policies on Int’l Business 1. Tariffs: taxes placed on foreign goods • Ex: U.S. places a 10% tariff on foreign jeans. $30 jeans now cost: • $33 2. Dumping: selling goods in a foreign market below cost or below the cost in their home country to drive out competitors (like a retail store using a loss leader). 3. Quota: places limits on the number of products that can enter 4.Embargo: no products allowed/accepted Example?

  31. Foreign Currencies • Exchange rate: value of one country’s currency expressed in the currency of another country. • $1US = ¥125 (Jap.Yen). A 12,500 ¥ camera in the U.S. would cost: • If exchange rate changes to ¥ 100 camera in U.S. now costs: $100 $125

  32. World Currencies • Pound £ • U.K. • Rand • South Africa • Rupee • India • Peso • Argentine Peso, Mexican Peso • Euro € • Germany, Italy, Netherlands, France, Spain • Yen ¥ • Japan • Dollar • U.S. Dollar, Canadian Dollar, Australian Dollar, New Zealand Dollar • Real • Brazil • Yuan • China • Franc • Switzerland

  33. Treaties & Trading Blocs • Treaties: • WTO: enforces rules governing international trade • NAFATA: free trade among U.S., Mexico and Canada • U.S. signed it originally with just…. • EU: 27 European countries • Why? Removes traiffs, encourages trade with the free movement of people, goods and capital. • Bulgaria and Romania recent additions in 2007 • 18 of 27 nations have adopted the Euro as their currency • U.K.? Canada

  34. Balance of Trade • Imports vs. Exports • Imports exceed Exports = Trade deficit (negative) • Exports exceed Imports = Trade surplus (positive)

  35. U.S. Trade deficit

  36. Top 10 U.S. Trading Partners (in billions) 1.  Canada: $518.10 2.  China: $345.45 3.  Mexico: $315.59 4.  Japan: $176.30 5.  Germany: $129.73 6.  United Kingdom: $97.22 7.  South Korea: $71.70 8.  France: $62.03 9.  Saudi Arabia: $59.32 10.  Brazil: $54.14

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