Management Notes

Reference Notes for Management

International business does not result in the following

International business does not result in the following


A. innovation is encouraged.
B. international cooperation is encouraged.
C. imports are rendered cheap.
D. consumption is minimized.

The Correct Answer Is:

  • D. consumption is minimized.

The correct answer is D) consumption is minimized.

Why “Consumption is Minimized” is Not a Result of International Business:

International business is the exchange of goods, services, and capital across national borders. It involves a variety of activities such as trade, investment, and the establishment of multinational corporations. While international business has numerous economic and social implications, the minimization of consumption is not one of its primary objectives or outcomes.

Here’s a detailed explanation of why “consumption is minimized” is not a result of international business:

1. Economic Growth and Trade:

International business typically aims to promote economic growth and development by facilitating trade between nations. It encourages the exchange of goods and services, leading to increased production, income, and economic activity.

Consumption is an integral part of this process, as increased trade often results in more choices and access to a wider range of products for consumers.

2. Innovation and Competition:

International business fosters innovation and competition by exposing firms to a global marketplace. When companies compete on an international scale, they are motivated to improve their products, services, and processes to gain a competitive edge. This innovation benefits consumers by offering better quality and more diverse products, which can lead to increased consumption.

3. International Cooperation:

International business often promotes international cooperation through agreements, treaties, and partnerships between countries. These cooperative efforts are designed to create a stable and predictable environment for businesses to operate in. Cooperation can result in reduced trade barriers, which can lead to increased trade and consumption.

4. Affordability and Access:

International business can make imported goods more affordable and accessible to consumers. It allows consumers to access products that may not be available or affordable domestically. This increased access to a variety of goods and services can enhance consumption options for individuals and households.

Why the Other Options Are Not Correct:

A. Innovation is Encouraged:

This option is correct. International business encourages innovation because companies are exposed to global competition, which motivates them to develop new products, services, and technologies to gain a competitive advantage. Innovation is a common outcome of international business, and it benefits both businesses and consumers.

B. International Cooperation is Encouraged:

This option is correct. International business often leads to increased international cooperation. Countries work together to create a favorable environment for trade and investment. Cooperation can result in trade agreements, alliances, and diplomatic efforts to facilitate business activities.

C. Imports Are Rendered Cheap:

This option is correct. International business can make imported goods cheaper for consumers because it increases competition and provides access to a wider range of suppliers. Competition among foreign and domestic producers can lead to lower prices for imported products, benefiting consumers.

In summary, international business primarily aims to promote economic growth, innovation, international cooperation, and increased access to goods and services. It does not have the objective of minimizing consumption but rather encourages economic activity and consumer choice.

The correct answer, “D. consumption is minimized,” is not aligned with the typical outcomes and goals of international business, which are focused on expanding economic opportunities and fostering global trade and cooperation. Understanding the objectives and effects of international business is crucial for policymakers, businesses, and individuals engaged in the global marketplace.

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