Question

1.WHAT ARE SOME BARRIERS TO ENTERING THE INTERNATIONAL MARKET? PROVIDE EXAMPLES.

2.WHAT ARE 3 ECONOMIC INDICATORS OF A COUNTRY? EXPLAIN EACH IN DETAIL.

Answer 1

1) Let us discuss some of the barriers to entering the international market-:

a)Monopolies-It is the greatest threat and barrier to every company before entering international business market and happens when only company is there as biggest provider of a product.

Monopolies make a block from entering competitors by using patents and licenses,every possible step to prevent substitute to enter in market by using various strategies like pricing,suppliers etc.

Ex-we will discuss about the internet services provision in North America.The people there have only two choices with them to get internet by cable or phone lines and in the rural areas,there was no cable installed,so the phone company was the only provider in the rural areas of North America and refereed as it made his monopoly.

b)Legal protection-This could be also a major issue before entering the international market as company need to take care of its intellectual property like copyrights,patents etc. and have effective systems and arrangements for proper dispute settlement system.

c)Bribery-This happens in major countries and all activities and set up can be made possible by the bribery which refers to corruption.

These practices are used to make government take measures that are beneficial to their industries.

In many counties,bribe is treated as everyday business occurrence and international can face various penalties and civil law suits.

2)Let us discuss about the three economic indicators of a country-:

a)Gross Domestic Product-It is usually referred as GDP which varies of country to country and GDP refers to value of final goods and services produces in the particular country in a specific period.The Increase in GDP of a country tells about the growing economy of a country.ex-it tells any company before setting up about the idea of growth in the country.

b)Consumer Price Index-It is referred as CPI and indicates about the changes in consumer good and services already purchased by households and it is taken over a period of time to measure inflation in the country,whereas Rising inflation rates refer to high interest rates and low inflation rates refers to low interest rates.

c)Purchasing Managers index-It is Referred as PMI and is an important economy indication which formed by Markit group and institute for supply management.This PMI index helps in getting about the Aquisition of goods by mangers in purchasing department.This helps company to stop making purchasing of raw materials when demand get low or negligible.