international marketing chapter 1 & 2

domestic marketing
marketing activities aimed at a firm’s domestic market
export marketing
marketing activities undertaken when a firm sells its products abroad and when those products are shipped from one country to another
international marketing
marketing activities undertaken when a company becomes significantly involved in local marketing environments in foreign countries
multinational corporation (MNC)
a company that possesses extensive investments in assets abroad and operates in a number of foreign countries as though it were a local company
multidomestic strategy
a strategy pursued by a multinational firm in which various marketing strategies are developed, each tailored to a particular local market
global marketing strategy
a single transnational strategy for a product, service, or business that nonetheless incorporates flexibility for local adaptation
global competence
the ability to balance local market needs with the demands of global efficiency and the opportunities of global synergies
invisible exports
a country’s earnings abroad from intangibles such as services, remittances, and income earned on overseas investments
absolute advantage
trade is based on each country selling what it is best at producing
comparative advantage
trade can occur between two countries even if one of the countries has no absolute advantage in any product
balance of payments
an accounting record of the transactions between the residents of one country and the residents of the rest of the world over a given period of time
current account
a principal part of the balance of payments statement that includes the key sub-accounts of goods, services, and unilateral transfers
goods or merchandise account
BOP account stating the monetary value of a country’s international transactions in physical goods
services account
BOP account stating a country’s international transactions in intangibles such as transportation services, consulting, royalties on intellectual property, and dividends on foreign investment
unilateral transfers
all the transactions for which there is no quid pro quo, such as private remittances, personal gifts, philanthropic donations, and aid
capital account
principal BOP account that records a country’s international financial assets and liabilities over the BOP period
portfolio investment
investments, such as the purchase of stocks and bonds, over which investors assume no direct management control
foreign direct investments
foreign investments over which investors assume some if not all direct management control
exchange rate
the ratio that measures the value of one currency in terms of another currency
an increase in value or price of a currency
a decrease in value or price of a currency
freely floating currency
a currency whose exchange rate is determined by the market forces of supply and demand
soft currency
a currency that attracts little global demand
pegged currency
a currency whose price is fixed by its government to another currency or basket of currencies
a tax on goods or services moving across an economic or political boundary
a physical limit on the amount of goods that can be imported into or, less commonly, exported from a country
orderly marketing arrangement (or voluntary export restriction)
an agreement between countries in which one country agrees to limit its exports to the other
non-tariff barriers
non-monetary restrictions on trade
most favored nation (MFN) status
a guarantee in a trade agreement between countries binding signatories to extend trade benefits to each other equal to those accorded any third state
free-trade area
two or more countries that formally sign an agreement to drop trade barriers among themselves but to allow each member country to maintain independent trade relations with nonmember countries
customs union
two or more countries that formally sign an agreement to drop trade barriers among themselves and to establish common external barriers between member and nonmember countries
common market
a form of economic integration with all the characteristics of a customs union and in which the free flow of resources, such as labor and capital, is encouraged among member nations