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Chapter Analysis
Intermediate21 pages • EnglishQuick Summary
The chapter on International Business for Class 11 Business Studies provides an overview of how global business operations differ from domestic ones. It emphasizes the increased complexity due to variations in political, social, and economic environments. The chapter discusses the scope and importance of international trade, the different methods for entering international markets, and the challenges companies face, such as currency differences and political risks.
Key Topics
- •International Business vs Domestic Business
- •Benefits of International Business
- •Modes of Entry into International Markets
- •Challenges in International Trade
- •Role of Multinational Corporations
- •Licensing and Franchising
- •International Trade Regulations
Learning Objectives
- ✓State the meaning of International Business
- ✓Distinguish between Internal and International Business
- ✓Discuss the scope of International Business
- ✓Enumerate the benefits of International Business
- ✓Discuss the documents required for import and export transactions
- ✓Identify the incentives and schemes available for international firms
Questions in Chapter
What is meant by international business?
Answer: International business refers to all commercial transactions—private and governmental—that take place between two or more countries.
Page 249
What is the difference between international and domestic business?
Answer: International business operations face more complexity due to different environmental factors like political, social, and economic conditions across countries. Domestic business, however, deals with a single country's market conditions.
Page 250
Discuss the benefits of international business.
Answer: International business helps countries earn foreign exchange, make efficient use of resources, improve growth prospects and employment potentials, and increase the standard of living.
Page 256
Explain the concept of licensing and franchising.
Answer: Licensing allows a firm to use another firm's trademarks, patents, or technology in exchange for a fee, while franchising allows a firm to use a business model and brand for a fee to provide services.
Page 255
What are the major entry modes for international business?
Answer: Some major entry modes are exporting/importing, joint ventures, licensing/franchising, and wholly owned subsidiaries.
Page 259
Additional Practice Questions
What are some common challenges businesses face when entering international markets?
mediumAnswer: Common challenges include dealing with different currencies, adhering to foreign regulations, adapting to diverse market needs, and managing supply chain and logistics complexity.
How does international business contribute to the globalization process?
mediumAnswer: International business contributes to globalization by integrating markets worldwide, facilitating cross-border trade and investment, and promoting cultural exchange and economic cooperation.
Describe how political risks can impact international business.
mediumAnswer: Political risks, such as changes in government policies, nationalization of industries, or political instability, can affect business operations, profitability, and market entry strategies in the international arena.
Compare and contrast export and import business in international trade.
easyAnswer: Exporting involves sending goods or services to another country for sale, while importing involves bringing in goods and services from abroad for domestic sale. Exporters focus on expanding markets while importers often deal with customs duties and different regulatory standards.
What role do multinational corporations (MNCs) play in international business?
hardAnswer: MNCs drive economic integration, create jobs, bring technological advances, and can shape international trade regulations due to their extensive global influence and operations.