ADVANTAGES OF INTERNATIONAL BUSINESS:
Though
international business are most important for a country’s economy but there are
some advantages and disadvantages of international business which are described
in detail below Following are the advantages of international business:
Earning valuable foreign currency: A country
is able to earn valuable foreign currency
by exporting its goods to other countries.
Division of labor: International
business leads to specialization in the production of goods. Thus, quality goods for which it has maximum advantage.
Optimum utilization of available resources: International
business reduces waste of national
resources. It helps each country to make optimum use of its natural resources.
Every country produces those goods for which it has maximum advantage.
Increase in the standard of living of people: Sale of
surplus production of one country to
another country leads to increase in the incomes and savings of the people of
the former country. This raises the standard of living of the people of the
exporting country.
Benefits to consumers: Consumers
are also benefited from international business. A variety of goods of better quality is available to them at
reasonable prices. Hence, consumers of importing countries are benefited as
they have a good scope of choice of products.
Encouragement to industrialization: Exchange
of technological know-how enables underdeveloped
and developing countries to establish new industries with the assistance of
foreign aid. Thus, international business helps in the development of industry.
International peace and harmony: International
business removes rivalry between different
countries and promotes international peace and harmony. It creates dependence
on each other, improves mutual confidence and good faith.
Cultural development: International
business fosters exchange of culture and ideas between countries having greater diversities. A better way of
life, dress, food, etc. can be adopted form other countries.
Economies of large-scale production: International
business leads to production on a large
scale because of extensive demand. All the countries of the world can obtain
the advantages of large-scale production.
Stability in prices of products: International
business irons out wide fluctuations in the
prices of products. It leads to stabilization of prices of products
throughout the world.
Widening the market for products: International
business widens the market for products
all over the world. With the increase in the scale of operation, the profit of
the business increases.
Advantageous in emergencies: International
business enables us to face emergencies. In
case of natural calamity, goods can be imported to meet necessaries.
Creating employment opportunities: International
business boosts employment opportunities
in an export-oriented market. It raises the standard of living of the countries
dealing international business.
Increase
in Government revenue: The Government imposes import and export duties for this trade. Thus, Government is
able to earn a great deal of revenue from international business.
Other
advantages:
Effective
business education
Improvement
in production systems. Elimination of monopolies, etc.
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