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WGU - D080_ FVC1 Enhanced Study Guide
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WGU - D080/ FVC1 Enhanced Study GuideWhat is globalization? - ANS-When international integration arises from the interchange
of world views, products, ideas and cultures.
What business opportunities are presented by globalization? - ANS-Trade, transactions,
capital, and investment movements. The migration and movement of people and the
dissemination of knowledge.
What are the economic effects of globalization? - ANS-International movement of
goods, capital, services and technology and information.
What are the political effects of globalization? - ANS-Reduces importance of nation
states
What are the cultural effects of globalization? - ANS-Ideas, meanings, values.
Decreased uniqueness by once-isolated communities.
What are the arguments for globalization from a country's perspective? - ANS-Access to
broader market, gains access to cheap labor.
What are the arguments against globalization from a country's perspective? -
ANS-Needs to understand foreign legal and political policies.
Explain the five stages of entering a global market. - ANS-1. First stage (market entry),
Companies enter new country's using business models similar to the ones in home
market.
2. Second stage (product specialization),
Companies transfer the full production process of a product to a single location.
3. Third stage (value chain disaggregation)
Desegregating the the production process and focus on completing each activity in a
better location. (different areas)
4. Fourth stage (value chain reengineering),
Companies seek to further increase their cost savings by reengineering their production
process
5. Fifth stage (creation of new markets)
Allows companies to lower their sticker prices in both new and old markets.
Explain Four drivers of globalization. - ANS-1. Market - explain convergence of needs,
,Allows companies to lower their sticker prices in both new and old markets.
2. Cost - define economies of scale and economies of scope
Refers to product development, manufacturing, and sourcing.
3. Competition - New markets, increased level of trade.
4. Government - Absence or presence of trade policies, technical standards, policies
and regulations.
What is the difference between the world is flat view and the CAGE analysis? -
ANS-Events that made the world smaller.
CAGE analysis
1."C" is for culture - Shared beliefs, practices, norms.
2."A" is for administration - Similar country's trade with each other
3."G" is for geography - Location
4."E" is for economic distance - Socioeconomic and demiographic.
What are the benefits of global expansion from MNCs' perspective? - ANS-Unsaturated
demand for new product
Lower labor costs
Less expensive natural resources
Higher revenue or lower structure cost
What are the costs of global expansion from MNCs' perspective? - ANS-Costs
Ethical business practice (labor, safety, environment)
Organizational structure (incorporating new regions to the value chain)
Public relations
Leadership
Legal and regulatory structure
List five different political systems and differentiate them. - ANS-Anarchy
Monarchy
Democracy
Oligarchy
Dictatorship
Anarchy - ANS-No govt is needed - individuals control the country
Monarchy - ANS-King or Queen rules the country or Constitutional Monarchy: Aruba &
Australia
,Democracy - ANS-Citizens organize political parties. Equal voice or vote in determining
policy but government is involved
Oligarchy - ANS-Owned by a small group of people, achieves power due to military,
economic or other powers
Dictatorship - ANS-Single person is in charge
Anarchy - ANS-No countries are ruled by anarchy, but some regions in Afghanistan and
Somalia
Absolute monarchy - ANS-single person ruling until death, such as the United Kingdom
Constitutional monarchy - ANS-Australia
Oligarchy - ANS-Russia, S. Korea
Dictatorship - ANS-Libya or Germany during WWI and WWII
Democracy - ANS-United States of America
List four different economic systems - ANS-1. Traditional Economy
2. Market Economy
3. Command Economy
4. Mixed Economies
Traditional Economy - ANS-The traditional economy uses methods of trade and
exchange that are passed through generations. It is the oldest of the four economic
systems and can still be found in parts of South America, Africa, and Asia. Occupations,
usually farming, are passed down through generations. People live off the products of
their labor. Traditional economies have very little economic evolution or growth.
Market Economy - ANS-In a market (decentralized) economic system, leaders make
decisions based on consumer demands. Goods and services are produced and
distributed according to the rules of supply and demand. In other words, consumers
influence how many products and services are made available through their purchasing
and usage patterns.
Command Economy - ANS-Communist societies use a command or centrally controlled
economy. Resources and businesses are owned by the government, which decides
, which goods and services will be produced and what prices will be charged. North
Korea and Cuba have command economies.
Mixed Economies - ANS-A mixed economy borrows the following characteristics from a
market economy: It protects private property, the laws of supply and demand determine
prices in a free market, and it is driven by self-interest. A mixed economy, like a
command economy, uses the federal government to protect the people and the market
and oversee the military, international trade, and national transportation.
List different legal systems - ANS-a. Civil law
Common Law
Religious Law
Please provide three legal systems - ANS-1. Civil law
2. Common Law
3. Religious law
Civil law - ANS-It is based on a detailed set of laws that constitute a code and focuses
on how the law is applied to the facts. The civil law system is inquisitorial, where the
investigating judge investigates the facts of the case, and Juries are rarely used. The
victim may participate in the trial and have rights. It is the most widespread legal system
in the world. Approximately 150 countries have a primarily civil law system. The civil law
system is found in most of continental Europe, Central America, and South America.
Basis in the Roman legal tradition.
Common Law - ANS-Judges interpret the law, and judicial rulings can set precedent.
Common law systems are often adversarial because the judge's role is to act as a
moderator between two opposing parties. A jury may determine the facts, and a judge
decides which law will be applied to the case. Both prosecutors and defense attorneys
have an active role. Victims may serve as witnesses, but they are not a party in criminal
cases. The legal system of the United States - except Louisiana, which has a mix of civil
and common laws - is a common law system. found in Australia, Canada, England, and
Wales. Approximately 80 countries have common law systems. Based on traditions and
precedence and can be traced to the English monarchy.
Religious Law - ANS-Also known as theocratic law and is based on religious guidelines.
Islamic law and prohibition of interest - ANS-Islamic law systems are found throughout
Africa, the Middle East, Central Asia, and South Asia. The most commonly known
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