WALMART SCENARIO
Walmart is the largest retailer in the world with more than 4,000 stores located in 14 countries outside the United States. The corporation has learned, sometimes the hard way, that the Walmart business model cannot be transferred to every country it enters due to cultural differences. For example, the retailer ran into difficulties in many European countries because stores are not open 24-hours a day, seven days a week like Walmart Supercenters are in the United States. When negotiating the purchase of Trust-Mart stores in China, the company had to develop relationships with executives before even discussing business opportunities. Finally, Walmart varies marketing mixes based on local tastes, cultures, and economic conditions.
-Refer to Walmart Scenario. Walmart has not yet expanded into Russia, perhaps because the total size of the consumer market in terms of buying power is so much lower than other countries. The term used to describe this purchasing power is known as _____.

Question

Quizplus · Accepted Answer

The term used to describe this purchasing power is known as purchasing power parity (PPP). This is the economic concept that compares different countries' currencies through a "basket of goods" approach, where the same items are priced in different currencies to determine their relative purchasing power. This helps determine the relative affordability of goods and services in different countries.

WALMART SCENARIO Walmart Is the Largest Retailer in the World with More