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Subject Matter of International Business

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FUNDAMENTALS OF INTERNATIONAL BUSINESS

MODULE#1

INTERNATIONAL BUSINESS AND INTERNATIONAL ECONOMICS.

GOVERNMENT REGULATION OF INTERNATIONAL TRADE

СONTENT:

INTRODUCTION

TOPIC#1. THE THEORIES OF INTERNATIONAL TRADE

TOPIC#2. INDICATORS OF INTERNATIONAL TRADE OF THE COUNTRY

TOPIC#3. TARIFF REGULATION

TOPIC#4. TARIFF REGULATION IN UKRAINE

TOPIC#5. NON-TARIFF REGULATION IN UKRAINE

TOPIC#6. GLOBAL INTEGRATION OF UKRAINE

RATING TABLE

Activity Points
1. Topic#1. The Theories of International Trade  
2. Topic#2. Indicators of International Trade of the Country  
3. Assignment: Analysis of the Trade Balance of Ukraine  
4. Paper work: Essay&Presentation  
5. Topic#3. Tariff Regulation  
6. Topic#4. Tariff Regulation In Ukraine  
7. Topic#5. Non-Tariff Regulation In Ukraine  
8. Topic#6. Global Integration Of Ukraine  
9. Law on Foreign Economic Activity of Ukraine  
10. Lecture Notes  
11. Activity  
12. Midterm Exam  
TOTAL  

ASSESSMENT SYSTEM

ECTS Points, %
5A 95-100
5B 90-94
4B 81-89
4C 75-80
3D 66-74
3E 60-65
2FX 55-59
2F 50-55

INTRODUCTION

Subject Matter of International Business

1. International economics deals with economic relations among nations. The resulting interdependence is very important to the economic well-being of most nations of the world and is on the increase. Most nations of the world export some goods, services and factors of production in exchange for imports which could be supplied less efficiently at home, or not at all (e.g. coffee in Ukraine, petroleum in Germany, cars in Kenya). Thus, a great deal of economic well-being of most nations rests crucially on international interdependence. In general, the larger the nations, the smaller its economic interdependence with the rest of the world. Economic relations and interdependence among nations influence (and are in turn influenced by) the political, social, cultural and military relations.

2. The economic relations among nations differ from the economic relations among the various parts of a nation. This gives rise to different problems, requiring somewhat different tools of analysis, and justifies international economics as a distinct and separate branch of economics. EXAMPLE: When a U.S firm wants to export a piece of machinery to Germany, it faces certain restrictions (such as a tariff) imposed by Germany. It must also overcome differences in language, customs and laws. In addition, the U.S. firm may receive payment in the foreign currency which may change in value in relation to the dollar. No such barriers are involved when the U.S. firm sells its machinery domestically.

QUESTIONS:

1. What does international economics deal with?

__________________________________________________________________________________________________________________________________________

2. What is international trade?

_________________________________________________________________________________________________________________________________________

3. True or false?

a) A nation can produce all products it needs

___________

b) International trade serves to improve the standard of living

_________

4. What are the backgrounds for international trade?

_________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

_____________________________________________________________________

5. What are the benefits of international trade?

______________________________________________________________________________________________________________________________________________________________________________________________________________

6. Are nations interdependent in economic relations? Why?

__________________________________________________________________________________________________________________________________________

_____________________________________________________________________

7. For which of the following products does Ukraine rely exclusively on imports?

a) natural gas; b) wood; c) tea; d) steel; e) cars.

8. How do international economic relations differ from interregional economic relations?

______________________________________________________________________________________________________________________________________________________________________________________________________________

9. In what way are they similar? One similarity between international and interregional trade is that in general both must overcome

a) tariffs; b) differences in language; c) distance or space;

d) differences in currencies and monetary systems.

10. In the study of international economics we use the tools of

a) microeconomic theory only; b) macroeconomic theory only;

c) neither micro nor macro theory; d) both micro and macro theory,

but we also extend, adapt and integrate them.

11. Which of the following topics does international economics deal with?

a) International trade theory; b) International trade policy;

c) the balance of payments; d) adjustment to disequilibria in the

balance of payments; e) all of the above.

TOPIC#1.




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N THE LAW OF COMPARATIVE ADVANTAGE | BY M. PORTER | Firm Strategy, Structure and Rivalry | THE THEORIES OF INTERNATIONAL TRADE | The Form and Content of International Contract | Documentation in International Trade | Efficiency of Exports | Calculating the cost of imports | Consolidated Goods and Services Balance | Table 1. Goods and Services Trade Balance, mln.USD |


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