why are firms keen on international trade

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  • Created by: chloeg321
  • Created on: 16-05-16 13:16
why are firms keen on international trade?
there are five reasons.....
1 of 6
to gain access to large markets
allows firms to increase size of potenical market
2 of 6
to gain economies of scale
if firms produce on a large scale in order to meet the demand of the increased market, they should be able to avail of economies of scale
3 of 6
diversification
trading internationally allows firms to diversify and this then reduces the level of risk of sudden chages in demand
4 of 6
saturated home market
firms may expand overseas because their home market has become saturated with similar businesses
5 of 6
pressure from shareholders
firms may be very keen to trade globally because they may be underpressure from their shareholders to increase profit levels
6 of 6

Other cards in this set

Card 2

Front

allows firms to increase size of potenical market

Back

to gain access to large markets

Card 3

Front

if firms produce on a large scale in order to meet the demand of the increased market, they should be able to avail of economies of scale

Back

Preview of the back of card 3

Card 4

Front

trading internationally allows firms to diversify and this then reduces the level of risk of sudden chages in demand

Back

Preview of the back of card 4

Card 5

Front

firms may expand overseas because their home market has become saturated with similar businesses

Back

Preview of the back of card 5
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