Chapter 9 Globalisation

Question 1

Globalisation

Answer 1

The growing integration of the world’s economies

Question 2

2 key features of globalisation

Answer 2

Goods and services are traded freely across international borders
People are free to live and work in any country they choose.

Question 3

Reasons for Globalisation

Answer 3

Developments in technology
Huge amount of Deregulation
International transport networks have improved.
An increase in tourism

Question 4

Developments in Techonology

Answer 4

has helped globalisation to gather pace and modern computing has allowed to transfer of complex data instantly to any part of the world making it easier for people to work at home or any location they choose.

Question 5

International transport networks have improved

Answer 5

The costs of flying have fallen and the number of flights and destinations have increased

Question 6

Government and Globalisation

Answer 6

Countries cannot trade if the government keeps international borders closed
People cannot be free to live,work in overseas if borders arent kept opened

Question 6

Huge amounts of Deregulation

Answer 6

Barriers to trade have been removed and privatisation has allowed more competition in many industries

Question 7

Opportunities of Globalisation for Business

Answer 7

Access to larger markets
Lower Costs
Access to Labour
Reduced taxation

Question 8

Access to larger markets

Answer 8

Provides huge opportunities to increase sales which increases profits.

Question 9

Lower Costs

Answer 9

If businesses are able to grow by selling output to larger markets, they may be able to lower their costs as they can exploit economies of scale, which will also make them more competitive, and they can win a larger market share, increase sales and raise profit margins

Question 10

Access to Labour

Answer 10

When there’s a shortage of domestic labour, globalisation can bring workers from overseas to help boost labour supply, which also means firms can have more people to choose from. Where they may be able to recruit better quality workers who could improve productivity. A RISING LABOUR SUPPLY might help prevent wages from rising where lower wages reduce business costs.

Question 11

Reduced taxation

Answer 11

Businesses can choose to locate their base by locating their head office in a country where business taxes are low.

Question 12

Threats of Globalisation

Answer 12

Competition
International Takeovers
Increased risk of external shops

Question 13

Competition

Answer 13

Some businesses will have their survival threatened due to increased competition as more companies try to sell their goods and services around the world in a growing number of countries. In some cases, entire industries have been wiped out by overseas competitors.

Question 14

International Takeovers

Answer 14

Companies will feel vulnerable to a takeover since there are larger number of predator businesses where some experience hostile takeover

Question 15

Increased Risk of External Shocks

Answer 15

The interdependence caused by globalisation can pose a threat to businesses as events in one economy are likely to affect other economies