Hafer: International Business Unit 1: 1-1

 Distinguish between domestic business and international business.  Discuss the reasons why international business is important.  Understand that international trade is not just a recent event

Key Terms  All business activities needed to create, ship, and sell goods and services across national borders.  *In the same way that people within a country are dependent on each other to produce goods and services, countries also are dependent on each other. International Business ( Also Called: global business, international trade, and foreign trade ). What Is What Is International Business? Business?

Key Terms  Making, buying, and selling goods and services within a country  If you purchase a soft drink made in your own country, you are participating in domestic business Domestic Business What Is What Is Domestic Business? Business?

 Materials, Parts, and Demand  The U.S. uses materials from all over the world to make different products.  i.e. Oil and Steel are purchased by U.S. companies yearly to use in factories.  Nearly every U.S. built car has parts that were manufactured in Japan, Mexico, France, Korea, England, and many other countries.

Key Terms  A condition that exists when items consumers need and want are created in other countries.  i.e. Drought and other weather conditions in an African country might cause crop failures. As a result, the African country must obtain food from other countries Global Dependency Why Is International Business Important? Business ?

 Global Opportunities  Companies sell to customers in other countries to expand business opportunities.  Businesses, large and small, increase sales and profits with foreign trade…these businesses are involved in the global economy.  Companies expand into other countries to create new investment opportunities…startups or growing enterprises.

 Improved Political Relations  An old saying says, “countries that trade with one another are less likely to have wars with each other”.  International business activities can help to improve mutual understanding, communication, and a level of respect among people in different nations.

 Evidence suggests that China, India, and Japan were trading products throughout the world 15,000 years ago.  Various inventions created between 1769 and 1915 expanded interest in and opportunities for foreign trade…cotton gin, steam engine, and telephone.  The previous inventions improved communication, distribution, and production…as well as creating new global industries.

International Business  all business activities needed to create, ship, and sell goods and services across national borders Domestic Business  making, buying, and selling goods and services within a country Global Dependency  a condition that exists when items consumers need and want are created in other countries

 Describe basic inter-national business activities.  Explain the components of the international business environment.  Name important skills for inter-national business and describe the importance of international business for workers, consumers, and citizens.

 Imports - products bought from businesses in other countries  Exports - products sold in other countries  Trade Barriers- restrictions that reduce free trade among countries

1 SLIDE 13 GEOGRAPHIC CONDITIONS ● Climate ● Terrain and seaways ● Natural resources ● Agriculture products ECONOMIC CONDITIONS ● Type of economic system ● Education level ● Type of industries ● Technology CULTURAL & SOCIAL FACTORS ● Language ● Education ● Religion ● Values and customs ● Social relationships POLITICAL & LEGAL FACTORS ● Type of government ● Political stability ● Government policies toward business

 International Business Skills  History- Your awareness of your past can help you better understand today’s international business relations.  Geography- Knowledge of geography will help you understand how the climate and terrain of a country can affect transportation, housing, and other business activities.  Foreign language- Your ability to communicate effectively with people from other societies is imperative for successful foreign trade.

 International business skills  Cultural awareness- You must be sensitive to customs and traditions of all societies.  Study skills- Asking questions, taking notes, and doing research are the tools necessary to keep up to date on changes in international business.  The global citizen- As a country becomes more involved in international business, the lives of its citizens change.