6.3 Globalisation

• What does the movement of labor and capital contribute to in globalization?

  Increased interconnectedness
• Order the opportunities presented by globalization for businesses:

  1️⃣ Access to new markets and customers globally

  2️⃣ Ability to source cheaper inputs and labor

  3️⃣ Opportunity to scale up operations

  4️⃣ Exposure to new technologies
• Globalization is driven by the spread of technology, information, and culture
• What is the primary impact of international trade and investment on globalization?

  Increased flow of goods
• Access to new markets and customers globally is an opportunity presented by globalization.


  True
• Match the globalization strategy with its description:

  Localization ↔️ Tailoring products/services to local markets

  Standardization ↔️ Offering standardized products/services globally

  Diversification ↔️ Expanding into new geographic markets

  Outsourcing ↔️ Contracting out business functions
• Diversification reduces reliance on any single market.

  True
• Order the challenges associated with globalization from those that primarily impact costs to those that focus on cultural differences:

  1️⃣ Exchange Rate Fluctuations

  2️⃣ Increased Competition

  3️⃣ Regulatory Compliance

  4️⃣ Cultural Differences
• Regulatory compliance requires businesses to adhere to different legal standards
• What is the definition of globalization?

  Interconnectedness and interdependence
• Globalization has led to a more integrated and interdependent global economy.


  True
• Match the driver of globalization with its description:

  International trade and investment ↔️ Flow of goods, services, capital, and technology

  Movement of labor and capital ↔️ People and investments move freely between countries

  Spread of technology and information ↔️ Ideas, information, and culture spread globally
• Globalization has led to a more fragmented and isolated global economy.

  False
• The key drivers of globalization include international trade and investment
• What are the two primary ways globalization impacts businesses?

  Opportunities and challenges
• What must businesses do to thrive in a globalized economy?

  Leverage opportunities and navigate challenges
• A disadvantage of standardization is that it may not meet local needs
• The choice of globalization strategy depends on the business's goals, resources, and specific challenges
• Exchange rate fluctuations can impact a business's profit margins.

  True
• One driver of globalization is international trade and investment
• The spread of technology and information is a key driver of globalization
• What is one challenge of globalization for businesses?

  Increased competition
• What is one driver of globalization related to the movement of people and investments?

  Movement of labor and capital
• Globalization creates a more integrated and interdependent global economy
• Increased competition from foreign firms is a key challenge of globalization
• What is an advantage of localization as a globalization strategy?

  Improved customer satisfaction
• What is a potential downside of outsourcing business functions?

  Loss of control
• Why is local preference adaptation a challenge for businesses in globalization?

  Businesses must tailor products
• What is crucial for businesses to understand when dealing with cultural differences in globalization?

  Diverse cultural norms