Key Terms
Globalization
Increasing interconnection of goods, services, capital, technology, and knowledge across borders. GLOBE Project: study o
Creates new opportunities
Expanded markets, wider resource access, increased profits. Creates new threats: opens domestic markets to foreign compe
Founded
Officially 1995; grew out of the General Agreement on Tariffs and Trade (GATT). Function: oversees agreements between me
Type
International financial institution. Function: provides loans for capital programs to developing countries.
Headquarters
Washington, DC. Membership: 189 member countries.
Function
Fosters global growth and economic stability; provides policy advice and financing; helps developing nations reduce pove
Original functions (at founding)
Short-term capital for balance of payments; overseeing fixed-exchange-rate arrangements. Mission shift: after 1971, floa
Global competition
Competing organizations that serve international customers through enhanced communications, improved shipping, reduced t
Four chief reasons
1. Increased profits — wider market and customer base; some countries have lower tax rates.
Supply chain
Full network from raw material through manufacturing, transport, storage, and delivery. Transnational strategy: combines
Logistics
Getting materials from one place to another when needed and storing them if necessary. It is a major field of study in b
Global supply chain
A supply chain that spans multiple countries.
Benefit
Businesses access low-cost goods and services in foreign locations, reducing operating costs. Risk: outsourcing increase
Sourced process (step by step)
1. Cotton grown domestically (with agricultural subsidies).
Innovation in business
Developing an idea or invention that increases efficiency, raises productivity, or creates value for which customers wil