Global Production Network, a single corporation may develop global operations, having its headquarters and some functions in a host country, but branch plants operating in other countries building on the advantages each location offers.
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IMF
International Monetary Fund, focuses on international financial stability & co-operation, plus to facilitate international trade.
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Interdependence
Mutual dependence at a global level. One country depends on another country for imports and for exports of goods and services. Countries have different goods such as bananas and oil which other countries don't have.
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Outsourcing
A TNC subcontracts an 'overseas' company to produce goods or services on its behalf. It involves contracting a relationship with a supplier and sometimes technology and technical assistance.
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Offshoring
The manufacture or assembly of a product, in a developing country, using components produced in a developed country.
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TNC
Transnational corporation, classified as a business operating in more than two countries.
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Vertical Integration
The entire supply chain of a company is owned by that company, from raw materials to finished products. This gives the TNC control over its supplies & stocks and reduces costs because of economies of scale e.g. BP AND Shell.
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Horizontal Integration
A strategy where a company diversifies its operations by expansion, merger or takeover, to give a broader capability at the same stage of production - either complimentary or competitive e.g Kraft or Nestle.
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Globally Integrated Enterprise
They are prepared to locate different functions of their business anywhere in order to get the best cost, skills and environment, for example Apple.
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Commodity
Any good or service produced by human labour and offered for general sale on the market. Something that can be brought and sold for profit e.g. Coffee.
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Fair Trade
Sets standards for farmers and workers in developing countries to have better trading conditions and to promote sustainability, helping them receive more equal pay.
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Comparative Advantage
The theory suggests that countries should specialise in providing goods and services that they excel at providing.
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Other cards in this set
Card 2
Front
IMF
Back
International Monetary Fund, focuses on international financial stability & co-operation, plus to facilitate international trade.
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