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 Herzogenaurach, Germany

McDonalds Oak Brook, IL; USA

Nike Beaverton, OR; USA

Hyundai Seoul, South Korea

Giorgio Armani Milan, Italy

Red Bull Salzberg, Austria

Sony Tokyo, Japan

Siemens Munich, Germany

Isuzu Tokyo, Japan

Shell (Royal Dutch Shell) The Hague, The Netherlands

British Petroleum London, England

DeBeers Southdale, South Africa

Cadbury Schweppes London, England

Louis Vuitton Paris France

Qantas Airlines: Sydney, Australia

WAL-MART Bentonville, Arkansas; USA

Volkswagen Wolfsburg, Germany

Accenture Largest consulting business in the world Hamilton, Bermuda

Juan Valdez Cafes Bogota, Colombia

Bayer Barmen, Germany

PEPSI New York City, NY; USA

Why Global? 1. Profit!! 2. Changes in the domestic market 3. New or larger markets in other countries 4. Lower production costs abroad 5. Treaties or trading blocs

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.” IMPORT EXPORT 51

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.

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?

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

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

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 of 27 nations have adopted the Euro as their currency U.K.? Canada

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

U.S. Trade deficit

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