Introduction to International Business Prepared by: Ms. Neetu Kushwaha

1. INTERNATIONAL BUSINESS
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What is International Business?
International business encompasses all commercial activities that take place to
promote the transfer of goods, services, resources, people, ideas, and
technologies across national boundaries.
International business occurs in many different formats:
•The movement of goods from country to another (exporting, importing, trade)
•Contractual agreements that allow foreign firms to use products, services, and
processes from other nations (licensing, franchising)
•The formation and operations of sales, manufacturing, research and
development, and distribution facilities in foreign markets

3. Features of International Business:
• Large scale operations
• Integration of economies
• Dominated by developed countries and MNCs
• Benefits to participating countries
• Keen competition
• Special role of science and technology
• International restrictions
• Sensitive nature

4. Advantages of International Business
1. A Country can Consume those Goods which it cannot Produce
2. The Productive Resources of the World are Utilized to the Best
Advantage of the Country
3. Heavy Price Fluctuations are Controlled
4. Shortages in Times of Famine and Scarcity can be met from
Imports from Other Countries
5. Countries Economically Backward but Rich in Resources may
Develop their Industries
6. International Business Promotes Peace and Friendship

5. Dis-Advantages of International Business
1. The Worst Part of Foreign or International Business is the Destruction of Cottage
and Home Industries
2. Dependence on Foreign Business Creates Difficulties in Times of Need
3. The Extreme Specialization which makes a Country Depend on One or Two
Industries is Bad
4. Countries which Sell Raw Materials and Buy Manufactured Goods in Return are
always Loser and cannot Improve the Country Economy
5. International Business may Completely Exhaust a Country’s Natural Resources like
Coal and Oil which are Irreplaceable
6. Imports of Harmful Drugs and Luxuries Goods ruin the Health of the Nation
7. International Business Rivalry Leads to Friction and War

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9. Big concept
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