Business Explain: Business

Describe three factors that complicate the process of an international business.

a distinction must be made between cash flows to the project and cash flows to the parent company
Political and economic risks, including foreign exchange risk, can significantly change the value of a foreign investment
The connection between cash flows to the parent and the source of financing must be recognized

Differentiate between multipoint pricing and experience curve pricing strategies.

Multipoint pricing-a firm's pricing strategy in one market may have an impact on a rival's pricing strategy in another market.

Experience curve pricing-price low worldwide in an attempt to build global sales volume as rapidly as possible, even if this means taking large losses initially.

What are the three factors that contribute to the trend toward greater retail concentration in developed countries? How have these factors promoted retail concentration?

The three factors that contribute are the increases in car ownership, the number of households with refrigerators and freezers, and the number of two-income households. All these factors have changed shopping habits and facilitated the growth of large retail establishments sited away from traditional shopping areas .

What is the most common approach to expatriate pay? Explain what comprises this form of compensation. What is the advantage of this approach?

The most common approach to the expatriate pay is the balance sheet approach. It equalizes purchasing power across countries and adds a financial incentive to take the position. A comprise is the taxation where they would have to pay both the home and host country governments. Expatriates will receive a service premium for working outside his or her country of origin.