CASE STUDY: THE
IMPORTANCE OF THE
By: Jessie Franz
INTERNATIONAL Radomes
BUSINESS
ENVIRONMENT
This case study aims to evaluate the factors affecting the economic development
of nations in international business, the effects of import and how to make a
win-win situation to countries involved
I. BRIEF BACKGROUND
The world’s largest and strongest economies rely heavily on international trade. Connection
between these countries is evidenced by the importation and exportation of goods and services
by the form of manpower. Even third world countries can improve its standard of living by a
successful international business trade. This also creates a harmonious relationship between
nations involved. Diplomatic relations and less military pressure is one of the benefits with
regard to it.
II. FACTORS ACCOUNTING FOR THE ECONOMIC DEVELOPMENT OF
ADVANCED NATIONS IN INTERNATIONAL BUSINESS
A. EXPORTATION
Exports improve a country's economic growth, minimize poverty and increase living standards.
Countries in Europe and East Asia rely heavily on exports and imports which resulted to increase
in GDP (Gross Domestic Product) and high standard of living. Exporting opens a new
opportunity with less barriers to entry to increase the sales of a company. Moreover, businesses
that rely on exportation were not greatly affected in times of economic recession.
B. INTERNATIONAL HARMONY
Trade creates dependence to each other. As a result, the countries involved were less likely to
create tension with one another. The standard of living of the citizens was expected to improve in
this situation because a safer nation is built; it would create a boosted sense of safety.
C. FREE INTERNATIONAL TRADE ENVIRONMENT
The economies of all nations are improved by a policy of a free international trading climate.
Competition from imports and exports leads to lower costs, higher product quality, broader
variety and better living standards. Although foreign trade can result in the loss of some
employment, the synergistic impact on the development of new jobs and the improvement of
economic conditions is greater.
III. HOW ARE IMPORTS AFFECTED BY INTERNATIONAL BUSINESS?
Imported goods result in lower prices and the number of consumer product options is increasing.
Lower prices have a major impact, particularly for households that are modest and low-income.
Studies show that lower import prices save about $10,000 a year for the average American
family of four. Besides lower costs, imports provide customers with a broader range of higher
quality goods. As a consequence, domestic producers are required to lower their prices and
expand their product lines in order to meet import competition. Furthermore, domestic retailers
will have to import more parts of their goods in order to remain competitive in price.
IV. INTERNATIONAL BUSINESS CREATES A WIN-WIN SITUATION TO
COUNTRIES INVOLVED
Over the past decades, their relationship has expanded and changed a great deal. Not too long
ago, mutual openness, intensifying diplomacy and bilateral economic relations characterized it.
For US and China, this was a win-win. International business reduces competition between
various nations and fosters international peace and harmony. Mutual trade creates a dependency
on each other, strengthens trust and fosters good faith. The relationship between the United
States and China is a clear example of co-dependency between nations. Even though these
nations have major political differences, because of the large amount of trade between them, they
try to get along.
V. IMPORTANCE OF INTERNATIONAL FREE TRADE
International free trade opens opportunities to all countries involved. The importation and
exportation of products has positive impact to the relations of the nations not only in economic
perspective. It surely has effects on the Gross Domestic Product of the parties; higher GDP for
exporting countries and less cost to importing ones. On the other hand, it creates a sense of
dependency which resulted to a harmonious connection. Less pressure is also evident to
countries trading internationally.
