International Business Environment 3

 What is international business ? Discuss the Nature and scope of International Business.
International business refers to the exchange of goods, services, technology, and information across
national borders. It involves transactions between individuals, companies, and governments from
different countries. The scope of international business is vast, and it covers a wide range of activities
that occur across national boundaries.
 Nature of International Business
1. Complex and dynamic: International business is not simple and straightforward. It is influenced
by a variety of factors that make it challenging to navigate.
2. Shaped by various factors: Culture, society, economy, politics, and legal differences all play a
role in shaping international business.
3. Involves interactions between individuals from diverse cultures: International business requires
an understanding of different cultures and customs.
4. Involves complex transactions: International business transactions require knowledge of trade
laws, customs regulations, and tax systems.
5. Exposed to various risks and uncertainties: International business is subject to risks such as
currency fluctuations, political instability, and cultural differences.
 Scope of International Business:
1. Import and export: International trade of goods and services across borders.
2. Foreign direct investment: Investment by a company in another country, typically through
establishing a subsidiary or acquiring a local company.
3. Licensing and franchising: Granting permission to use intellectual property, technology, or brand
name to a foreign company.
4. Joint ventures: Partnership between a local company and a foreign company to conduct
business together.
5. International mergers and acquisitions: A company acquires or merges with a foreign company
to expand its global presence.
 What is MNC ? Highlight the feature MNC ?
MNC stands for Multinational Corporation. It is a company that operates in multiple countries, typically
with a central headquarters in one country.
Features of MNCs:
1. Large scale: MNCs are typically very large companies, with operations and employees spread
across multiple countries.
2. Diversified operations: MNCs often engage in a variety of businesses, from manufacturing to
services to retail.
3. Global presence: MNCs have a significant presence in multiple countries and often have a well-
established brand and reputation across the globe.
4. Interconnected subsidiaries: MNCs usually have a centralized headquarters that oversees and
coordinates operations of its subsidiaries in different countries.
5. High degree of complexity: Due to their size and global presence, MNCs can have complex
organizational structures and management systems.
 Merger and acquisition
 Merger and acquisition (M&A) refers to the process of combining two or more companies into a
single entity, or one company taking over another. M&A activities are typically used by
companies to achieve strategic objectives such as increasing market share, gaining access to
new customers or products, or improving economies of scale.
 In a merger, two companies agree to combine their businesses to form a new entity, with the
shareholders of both companies becoming shareholders in the new entity. In an acquisition, one
company (the acquirer) buys another company (the target), with the target’s shareholders
typically receiving a premium on the current market value of their shares.
 M&A activities can take many forms, including horizontal mergers (mergers between companies
in the same industry), vertical mergers (mergers between companies in different stages of the
supply chain), and conglomerate mergers (mergers between companies in unrelated industries).
 M&A activities can be complex and involve a range of legal, financial, and operational
considerations. They can also have significant implications for employees, customers, and other
stakeholders. As a result, M&A activities are often closely scrutinized by regulators and other
stakeholders to ensure that they are in the best interests of all parties involved.
 Growing concern for ecology
There has been a growing concern for ecology in recent years, as people become more aware of the
impact that human activities have on the environment. There is a growing recognition that we need to
take action to protect the planet and preserve its natural resources for future generations.
This concern for ecology is driven by a number of factors. One of the main factors is the growing
awareness of the impact of climate change, and the urgent need to take action to reduce greenhouse
gas emissions and mitigate the effects of global warming. This has led to a greater focus on renewable
energy, energy efficiency, and sustainable transportation.
Another factor driving concern for ecology is the growing awareness of the impact of pollution on the
environment and human health. This has led to increased efforts to reduce waste, recycle materials, and
reduce the use of harmful chemicals and materials.
There is also a growing understanding of the importance of biodiversity and the need to protect
endangered species and ecosystems. This has led to increased efforts to protect habitats, preserve
natural areas, and promote sustainable land use practices.
Overall, the growing concern for ecology reflects a growing recognition of the importance of protecting
the natural environment and promoting sustainable development. It is important that we continue to
take action to address these issues and work towards a more sustainable future for ourselves and future
generations.
 What is digitalization
Digitalization is the process of using digital technologies to transform business operations and services,
creating new ways of working, and improving efficiency and effectiveness. It involves the conversion of
analog information into digital form, enabling it to be stored, processed, and transmitted more easily
and quickly.
Digitalization has had a profound impact on society and the economy, enabling new forms of
communication, collaboration, and commerce. It has revolutionized industries such as media, retail,
finance, and healthcare, and has created new opportunities for innovation and entrepreneurship.

International Business Environment 3

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 What is international business ? Discuss the Nature and scope of International Business.

 Nature of International Business

 Scope of International Business:

 What is MNC ? Highlight the feature MNC ?

 Merger and acquisition

 Growing concern for ecology

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