Is very important recognize, depend about the global geographic position, the economic factor represent money, we think in interest, debt, the prize up or low, is a determinate factor, financial or monetary system that are implemented by the government, activities local and international activities for an economic performance. Every country has a balance of payment Exchange rate Manage the currency
ABSOLUTE ADVANTAGE: Vietnam and Germany: Adam smith, get specialization in one activity, COMPARATIVE ADVANTAGE: Few differences in production activities COMPETITIVE ADVANTAGE: Strong local competition benefits a national industry. Core business Core process Core competence
Balance of payments: all legal activities, all the Colombian activities for register the most important is the Current account:
CAPITAL ACCOUNT: Records a country´s international financial assets and liabilities over the BOP period PORTFOLIO INIVESTMENTS: Investments such as the purchase of stocks and bonds, over which investors assume no direct management control. FOREIGN DIRECT INVESTMENT: Investments over which investors assume some if not all direct management control.
GLOBAL ECONOMYGLOBAL ECONOMYAN INTERNATIONAL MARKETER’SAN INTERNATIONAL MARKETER’SMINEFIELDMINEFIELD
BASIC THEORIES OF WORLD TRADEBASIC THEORIES OF WORLD TRADE•ABSOLUTE ADVANTAGE: Vietnam and GermanyABSOLUTE ADVANTAGE: Vietnam and Germany•COMPARATIVE ADVANTAGE: Few differences inCOMPARATIVE ADVANTAGE: Few differences inproduction activitiesproduction activities•COMPETITIVE ADVANTAGE: Strong local competitionCOMPETITIVE ADVANTAGE: Strong local competitionbenefits a national industry.benefits a national industry.Core businessCore businessCore processCore processCore competenceCore competence
BALANCE OF PAYMENTSBALANCE OF PAYMENTS•Balance of payments (BOP): an accountingBalance of payments (BOP): an accountingrecord of the transactions between the residentsrecord of the transactions between the residentsof one country and the residents of the rest of theof one country and the residents of the rest of theworld over a given period of time.world over a given period of time.•Current account: A principal part of the balanceCurrent account: A principal part of the balanceof payments statement that includes the key sub-of payments statement that includes the key sub-accounts ofaccounts ofGoods: physicalGoods: physicalServices: royalties, transportation services…Services: royalties, transportation services…Unilateral transfers: Donations, personal gifts…Unilateral transfers: Donations, personal gifts…
BALANCE OF PAYMENTSBALANCE OF PAYMENTS• CAPITAL ACCOUNT: Records a country´ sCAPITAL ACCOUNT: Records a country´ sinternational financial assets and liabilities overinternational financial assets and liabilities overthe BOP periodthe BOP period• PORTFOLIO INIVESTMENTS: Investments suchPORTFOLIO INIVESTMENTS: Investments suchas the purchase of stocks and bonds, over whichas the purchase of stocks and bonds, over whichinvestors assume no direct management control.investors assume no direct management control.• FOREIGN DIRECT INVESTMENT: InvestmentsFOREIGN DIRECT INVESTMENT: Investmentsover which investors assume some if not allover which investors assume some if not alldirect management control.direct management control.
EXCHANGE RATESEXCHANGE RATES• The ration that measures the value of oneThe ration that measures the value of onecurrency in terms of another currencycurrency in terms of another currency• APPRECIATION: An increase in value or price ofAPPRECIATION: An increase in value or price ofa currencya currency• DEPRECIATION: A decrease in value price of aDEPRECIATION: A decrease in value price of acurrency.currency.
CAUSES OF EXCHANGE RATECAUSES OF EXCHANGE RATEMOVEMENTSMOVEMENTS•Currency´ s value rises: Domestic businessesCurrency´ s value rises: Domestic businessesfind it more difficult to compete internationallyfind it more difficult to compete internationally•Currency´ s value falls: foreign goods becomeCurrency´ s value falls: foreign goods becomemore expensive, domestically produced goodsmore expensive, domestically produced goodsbecome cheaper to foreign buyers.become cheaper to foreign buyers.
MANAGED CURRENCIESMANAGED CURRENCIES• FREELY FLOATING CURRENCY: A currencyFREELY FLOATING CURRENCY: A currencywhose exchange rate is determined by thewhose exchange rate is determined by themarket forces of supply and demandmarket forces of supply and demand• SOFT CURRENCY: A currency that attracts littleSOFT CURRENCY: A currency that attracts littleglobal demandglobal demand• PEGGED CURRENCY: A currency whose price isPEGGED CURRENCY: A currency whose price isfixed by its government to another currency orfixed by its government to another currency orbasket of currencies.basket of currencies.
GLOBAL OUTSOURCINGGLOBAL OUTSOURCINGhttp://wtso.net/movie/134-The_Simpsons_1717_Kiss_Kiss_Ban