*NEW* Unit 5 International Business: P3 - Explain the main features of globalisation that affect two contrasting businesses.
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Unit 5 - International Business
Instelling
PEARSON (PEARSON)
*Certified High Graded Work* Unit 5 International Business: P3 - Explain the main features of globalisation that affect two contrasting businesses.
Learning aim B: Investigate the international economic environment in which business operates B1 Globalisation • The main features of globalisati...
high profits. Apple operates its production in international trade markets such as within China
to get lower production costs of its goods for greater profits, which can Apple can offer
products at lower prices to entice customers buying decision for their highly- end tech
products, this can be beneficial for Apple as they can see a
dramatic increase in profitability and greater profit margins.
L.A.B: p3
Explain the main features of globalisation that
affect two contrasting businesses
Globalisation:
Globalisation refers to global transformations that are causing
us to shift away from self-contained countries and toward a
more interconnected globe. Business globalisation refers to
the transformation of a corporation from one connected with
a single country to one that operates in several countries.
Globalisation means that, as communication, financing, and
ties between nations improve, global trade and partnerships
become more accessible. Technological advancements on a daily basis imply that trading with
firms in other nations is now easier. Globalisation has several characteristics, including
governments cooperating, individuals relocating for work, organisations collaborating across
boundaries, and global payment networks. In this article, I'll discuss the several major
characteristics of corporate globalisation. These will be the functions: Blocks of trade
International labour and capital mobility Currency of the world Communication in international
business Payment Systems around the World
Trading blocs:
There are different geographical areas that consist of different countries that make up trading
blocs. In these individual areas free trade is allowed. The countries in a trading bloc will have a
certain set of rules for countries inside the bloc and a different set of rules for countries
outside. In these country's goods will be moved freely. The objectives of these trading
blocs are to reduce trade barriers between countries in these Areas, to maintain better
relations and to promote free transfer of labour, CapitaLand other factors. An increase in
foreign direct investment may result from the creation of trade blocs. This can benefit the
economies of participating nations by creating jobs in new or expanded businesses. One
disadvantage is there will be a loss of sovereignty. A trading bloc, particularly when it is
coupled with a political goal, is likely to lead to at least partial loss of sovereignty for its
, participants. For example, the European Union, started as a trading bloc in 1957 by the Treaty
of Rome, has transformed itself into a far-reaching political system that deals not only with
trade matters, but also with human rights, consumer
protection, greenhouse gas emissions and other issues
which are only marginally related. The European Union
encompasses of 8 countries within Europe and has
developed as internal market as a result, which
guarantees the free movement of the four kingdoms, this
being, goods, cap trial services and people
International mobility of labour and capital:
The ease with which labourers may move about within an economy and across economies is
referred to as labour mobility. Money mobility implies that there are no transactions or other
expenses associated with transferring capital from one jurisdiction to another. Geographical
mobility, occupational mobility, and movement between industries are all examples of labour
mobility. Labour mobility is determined by the amount of educated and talented employees,
since they have more opportunities to move to a variety of jobs, lowering the likelihood of
unemployment. It also relies on the social structure, as a culture with no joint family and caste
system would promote labour mobility. Capital mobility is determined by capital flow
tariffs/taxes, capital flow limits, rules and regulations, and exchange rate fluctuations. Capital
mobility makes it easier to attract foreign direct investment to the country (FDI). It increases
investment and domestic consumption and reduces domestic savings
International currencies:
Is a currency that is transacted internationally, with no set borders? There are more than 150
different currencies in the world. Globalisation means that businesses are aware of the
different ways to trade and the currencies that can be used. There are numerous currencies
such as, Japanese yen (¥), U.S Dollars ($), Pounds sterling (£), Nigerian Naira ( ) and many more.
Some country's currencies are more valuable than other ₦ 14 country currencies, for example,
currently Kuwaiti is the most valuable currency in the world, as (Kuwaiti dinar to euro) 1 KWD =
2.78 EUR. International currencies affect businesses in two ways: they change the cost of goods
obtained from a different country, and they change the desirability of their products to foreign
clients and customers.
Multinational corporations:
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