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Chapter 2 Notes
Chapter 2 Notes
Importing
- To bring products or services into a country, for use by another business or
for resale
- The majority of the goods that Canada imports come from the United States
Value Added: The amount of worth that is added to a product at each stage
of processing. It is the difference between the cost of the raw materials and
the finished goods.
Tariffs: the most common type of trade barrier, are taxes or duties put on
imported products or services.
Tariffs raise the cost of imports, so that locally manufactured products are less
expensive and more appealing to consumers.
Tariff winners:
- Domestic governments – they collect the additional taxes
- Local producer – their goods are more competitively priced
- Local employees – the people working in local companies keep their jobs
Tariff losers:
- Foreign producers – their goods are now more expensive
- Consumers – the price of the products go up and consumers are forced to
pay higher prices
- Foreign employees – the people working in companies overseas lose out on
opportunities
Standards
- Countries have different standards for products in areas such as
environmental protection, voltage, and health and safety
- The ISO (International Organization for Standardization) is a network of
standardization groups form over 170 countries established to set quality
regulations
Hard currencies: stable currencies, such as the euro, and the U.S. and
Canadian dollars, which are easily converted to other currencies on the world
exchange markets.
Time Zones:
- Communication technology allows the world of international business to
operate twenty-four hours a day
- Certain methods of communication can be used at any time (email), other
methods (telephone) require knowledge of time zones
- Some methods offer immediate feedback and interaction, others do not