Environmental Factors

  • https://www.youtube.com/watch?v=BeJy3dA4Ah
  • Answer the below questions in 300 words
  • Provide a clear and specific explanation of the environmental factors you saw in the video.
  • Detail how the individual factor within the video could affect international business.
  • List some of the advantages and disadvantages of incorporating or not incorporating this environmental factor in a business operating across national borders.

Economic

To see an example of the economic environment within an international business, one could look at the impact of oil on a global scale. There are numerous domestic oil companies (within several independent countries’ borders), and as oil pricesfluctuate, so does the effect on each country’s economic sector. Even here in the United States, as oil prices change (whether demand or supply), so too does the variation in the economy.

Political

Some of the factors to review in this environment are the type of governmental system, types of trade agreements, and trade barriers (tariffs, taxes, and regulations). For instance, we want to examine what type of government is in place. Is it a democracy? Is it authoritarian? By looking into these details, one can see how the country is run, and study any political barriers that may become obstacles to placing a corporate product within that country. Several of the political factors are closely tied to the legal environment.

Legal

Public international law, private international law and foreign law.

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