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International Business

In: Business and Management

Submitted By dkwilson128
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Chapter 2 2. What is cultural literacy? Why should businesspeople understand other cultures?
Cultural literacy is detailed knowledge about a culture that enables a person to function effectively within it. It improves your ability to manage employees, market your products, and conduct negotiations in other countries. Businesspeople should understand other cultures because without understanding the way things work in these cultures it would be easy to offend its people by placing the wrong advertisement, using the wrong colors in the ad or on the product and packaging, or the translation of the English version might mean something disgraceful or derogatory to that cultures religion or beliefs.
Chapter 3
1. What are the five main types of political risk? How might each affect international business activities?

Conflict and violence- Conflict may arise from many different sources. The people may have resentment towards their own government, conflict may stem from disputes over territories between countries, it may arise from disputes among ethnic, racial or religious groups. These violent disturbances hinder the company’s ability to manufacture and distribute products, obtain equipment and materials, and recruit talented personnel.

Terrorism and kidnapping- Terrorists make statements to politics through tactics that cause fear and destruction. Terrorists use kidnapping as a means to raise money for their terrorist activities. Most international companies have “deep pockets” so terrorists target executives from these companies. Kidnapping usually happens in Latin American countries. Due to the extreme violence that takes place and the high ransom requests most companies purchase kidnap, ransom, and extortion insurance and train their employees to avoid trouble at all costs.

Property seizure- This is when the government of a country steps in and...

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