Answered: International Business and outline the…

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Question

Briefly define International Business and outline the ways in which it differs from domestic business.Give relevant examples

Expert Solution

Step 1: define International Business and outline the ways in which it differs from domestic business

International business is the trade of goods, services, technology, capital, and/or knowledge across national borders and at a global or transnational scale. It involves cross-border transactions of goods and services between two or more countries. International business differs from domestic business in several ways, such as:

International business deals with multiple currencies, whereas domestic business deals with a single currency.
International business faces more restrictions and regulations, such as tariffs, quotas, subsidies, exchange controls, etc., whereas domestic business faces fewer restrictions and regulations.
International business has to deal with different cultures, languages, laws, customs, preferences, etc., whereas domestic business has a more homogeneous environment.
International business requires more capital investment, risk management, and market research, whereas domestic business requires less capital investment, risk management, and market research.
International business has a larger and more diverse customer base, whereas domestic business has a smaller and more homogeneous customer base.