Global Business Summary

International Business Chapter 1 Globalizing business What is global business International business (IB): (1) a business (firm) that engages in international (cross border) economic activities and/or (2) the action of doing business abroad. Multinational enterprise (MNE): A firm that engages in foreign direct investment (FDI) Foreign direct investment: investmen in, controling, and managing value-added activities in other countries Global business: Global business includes both (1) international (cross border) business activities covered by traditional IB books and (2) domestic business activities. Emerging markets=emerging economies= new words for“developing countries” Gross domestic product (GDP): the sum of value added by resident firms, households, and governmeent operating in an economy. Purchasing power parity (PPP): A conversion that determines the equivalent amount of goods and services different currencies can purchase BRIC: Brazil, Russia, India, China Gross national Product (GNP): Gross domestic product (GPD) plus income from nonresident sources abroad. Gross national income (GNI): Gross domestic product (GPD) plus income from income from non resident sources abroad. GNI is the term used by the world bank and other international organizations to supersede the term GNP Triad: North america, Western Europe and Japan Base of the pyramid: economies where people make less than 2000 a year. Why study global business 1. enhance your emplyability and advance your career in the global economy 2. better preparation for possible expatriate assignments abroad 3. stronger competence in interacting with foreign suppliers, partners, and competitors and in working for foreign-owned employers i you own country G-20: group of 19 major countries plus the EU whose leaders meet on a biannual(2jaarlijkse) basis to solve global economic problems Expatriate manager(expat): a manager who works abroad International premium: a significant pay raise when working overseas Global