Paper 1 (c)

• Dumping


  Where an overseas business sells products below cost in domestic firm
• Infant industries


  New industries that still need to establish themselves
• Protectionism


  An approach by government to protect domestic producers
• Common market/ single market


  Market where goods and services can more freely among member countries
• Customs union


  A market where trade barriers are reduced and all member countries adapt the same rules/barriers against non-member counties
• Preferential trade area


  Low tariffs on certain products
• Economic and monetary union


  Trade barriers are removed - goods can move freely and common currency
• Free trade area


  Remove trade barriers among member states but keep different barriers with other countries
• Economic union


  Custom union and common market
• Regional trade agreement


  Trade agreement between a specific geographic location which involves reducing trade barriers to encourage trade
• Rules of origin


  Products made must be certified in the country made (regional trade agreement)
• ASEAN


  Association of southern east Asia nations - 10 countries including Singapore and Vietnam
• Economies of scale


  Increasing the scale of production leads to efficiency and lower costs
• Labour productivity


  Amount of goods produces by one hour of labour
• Offshoring


  Shifting jobs to another country (BT: call centres to India)
• Outsourcing


  Shifting jobs to other organisations
• Product life cycle


  The stages a product goes through: development, introduction, growth, maturity and decline
• Pull factors


  Economies of scale and risk spreading
• Push factors


  Competition and saturated market
• Saturation


  Limited opportunity for the product to grow
• Disposable income


  Amount of money a person has left over after paying taxation and other necessities
• Exchange rate


  Price of one currency to another
• Infrastructure


  Basic system, facilities and services required for a country's economy (schools, hospitals, transportation links)
• Reshoring


  Bringing production back home after using it abroad
• Assessment of a country as a production location


  Ease of doing business, infrastructure, political stability, skills and availability of a labour force, natural resources, likely return on investment and location in trading bloc
• Assessment of a country as a market


  Ease of doing business, infrastructure, disposable income, political stability and exchange rate
• Franchising


  Where a business allows another to operate under its name
• Licensing


  Produce another businesses products and use its intellectual property in exchange of a fee
• Intellectual property


  Intangible property that is a result of creativity (copyright)
• Barriers to entry


  Factors that make it difficult for new entrants from entering the market
• Differentiation


  Setting the product apart from its rivals - through USP or a established brand
• Skill shortages


  Where potential employees don't have the skills that employer is looking for
• Economic risk


  Future cash flows will change due to unexpected fluctuation in exchange rate
• Global marketing strategy


  Process of adjusting a company in order to meet a certain country's requirements (language or promotion)
• Global niche market


  Customers that have specific needs in more than one country which is not met by global mass markets
• Cultural/social factors


  Unintended meanings, language, inappropriate/inaccurate translations, differing tastes and inappropriate/inaccurate promotion
• Ethnocentrism


  Tendency of people to view their own culture, ethics and norms as superior
• Cultural audit


  Study or examination of a country's culture to determine whether they support or hinder the business's mission statement and vision
• High-context culture


  Emphasise interpersonal relationships (build trust for example)
• Low-context culture


  Emphasis on direct language