Question 1

Thabo had contracts for web designs in Japan and France and, therefore, has decided to start a business.The company will be reaching an international market strictly through online operations.Based on this type of global business, what organisations could offer advice to make this business feasible?

Accepted Answer

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Question 2

Which government organisation is an excellent source of information about analysing markets, financing and planning strategy?

Accepted Answer

The Department of Trade and Industry: Export Help Desk is specifically focused on providing information and support for exporting businesses, including market analysis, financing, and planning strategies. The other options may also provide some helpful information, but they have a broader focus and may not be as targeted towards export-related topics.

Question 3

Melanie's Marbles is a young company that buys unusual marbles from many places around the world.To provide assurance for her vendors that they will be paid, Melanie has established a ______________ at her bank.

Accepted Answer

A letter of credit is a financial tool used by businesses to guarantee payment to their suppliers. In this case, Melanie's Marbles is using it to provide assurance to her vendors that they will be paid for the marbles they supply. The bank acts as an intermediary between Melanie and the vendors, and pays the vendors on Melanie's behalf once certain conditions (such as the delivery of the marbles) are met. This reduces the risk for both parties and ensures a smooth transaction.

Question 4

When the exchange rate for a currency rises relative to that of another country, the rising currency:

Accepted Answer

When the exchange rate for a currency rises relative to that of another country, it means that the currency has become more expensive and is now worth more in terms of the other currency. Therefore, it has increased in value relative to the other currency.

Question 5

The Federation of International Trade Associations website, which includes an Africa Trade Mini-Portal, is a source of trade:

Accepted Answer

The Federation of International Trade Associations website includes an Africa Trade Mini-Portal, which is a source of trade leads.

Question 6

Once an exporter has shipped a product internationally and the title has been transferred, the exporter receives what is called a(an):

Accepted Answer

A bill of lading is a legal document issued by a carrier that details the shipment of goods and serves as proof of ownership of the goods. Once the exporter receives the bill of lading from the carrier, they can use it to claim ownership and receive payment from the buyer. It is an important document in international trade and shipping. The other options listed refer to different documents or processes that may be involved in international trade, but do not specifically relate to the transfer of ownership of goods.

Question 7

Which country would be the least challenging in its ease of doing business according to the World Bank's index?

Accepted Answer

According to the World Bank's "Doing Business 2020" report, Chile ranks highest out of the given options at number 59 out of 190 countries in terms of ease of doing business. Madagascar ranks the lowest at number 161, followed by Egypt at 114 and Argentina at 126.

Question 8

Describe six strategies that a small businesscan use to go global.

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Question 9

Simangele has formed an agreement with a French company to produce and sell her scarves in their ten stores across Europe.The scarves are Simangele's original designs and are of different colours and fabrics.They will then pay Simangele a fee for each scarf they produce.What are the advantages and disadvantages of the globalisation strategy Simangele will be utilising?

Accepted Answer

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Question 10

After identifying each of the four driving forces that encourage entrepreneurs to go global, discuss the change in traditional to emerging perspectives.

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Question 11

Palesa is the CEO of a small business which is looking to expand globally.She wants to move her business to a European country and feels that is where the product will be most profitable.What are three challenges that Palesa needs to analyse for the area in which she is considering expanding her company?

Accepted Answer

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Question 12

Coca-Cola leased land and built a bottling operation in Turkey.This new facility is best described as:

Accepted Answer

Coca-Cola built a new facility on previously undeveloped land, indicating that this is a greenfield venture.

Question 13

A small company can deal with changing currency rates by:

Accepted Answer

Stating contracts in US dollars (or another stable international currency) can help mitigate the risks of fluctuating exchange rates, as the company's revenue streams will be more predictable and stable. Locating plants in countries with advantageous exchange rates may not be feasible or cost-effective, and limiting sales in each country could potentially limit growth opportunities. Following the advice of the international sales manager may not necessarily address currency rate risks.

Question 14

From a company-owned plant in Turkey, Vicky manufactures speciality apparel items for her small business, Garments of Eden.Because of overseas military operations in the region, Vicky fears that her plant may be sabotaged or that the local government may attempt to take over the facility.Specifically, her fears are about:

Accepted Answer

Vicky's fears are related to political risk, which refers to the potential for government actions or political instability to negatively impact business operations. Economic risk, on the other hand, typically refers to general economic conditions such as inflation or recession, while exchange rate risk relates to the potential for fluctuations in currency exchange rates to affect business profitability.

Question 15

The risk that a new government regulation could damage business activity in a country is considered:

Accepted Answer

Political risk refers to the risk arising from factors related to the political environment of a country, including government policies and regulations. The introduction of new regulations that are unfavorable to businesses can impact their operations and profitability, hence the risk is considered political. Economic risk refers to the risk of economic factors such as inflation, interest rates, or economic downturns impacting a business. Exchange rate risk refers to the risk of fluctuations in currency values impacting international transactions. Global risk refers to the risk of events such as natural disasters, pandemics, or geopolitical tensions impacting businesses on a global scale.

Question 16

What are question topics that should be considered before going global specifically related to management objectives, management experience and resources as well as production capacity and financial capacity?

Accepted Answer

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Question 17

What are the differences and similarities of exporting and importing?

Accepted Answer

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Question 18

An intermediary that works for foreign businesses that are interested in buying South African products and is paid a commission for its services is called a(n) _____.

Accepted Answer

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Question 19

Describe the role trade intermediaries play in assisting small businesses that choose to go global.Identify the types of trade intermediaries that are most useful to small businesses.

Accepted Answer

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Question 20

What options do small businesses have when dealing with political risks globally?

Accepted Answer

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Quiz 18: Global Opportunities for Small Business