Question

3 - global nature of business

learning objective: determine the impacts of international trade on different countries economies.

why is it crucial for a company to have a global vision, even if it only operates locally?

a.) with international travel on the rise, more people are traveling abroad than ever before.
b.) global trends, competitors, and supply chains are having a bigger impact on local markets.
c.) global expansion ensures profitability in the long term.
d.) it boosts a companys image when they hire foreign workers.

Explanation:

Analyze the core question

The question asks why a local company needs a global vision.

Evaluate the external business environment

Using the Business Environment and External Environment concepts, we know that local markets do not exist in isolation. Even if a business only sells locally, its suppliers, competitors, and customer preferences are heavily influenced by international developments.

Assess the given options

• Option (a) focuses on leisure travel, which is too narrow to explain a general business necessity.
• Option (b) correctly identifies that global trends, competitors, and supply chains directly impact local markets.
• Option (c) is incorrect because a local company, by definition, is not undergoing global expansion.
• Option (d) is a narrow and unsupported generalization about hiring.

Select the best option

Option (b) is the most comprehensive and accurate explanation.

Answer:

• a.) With international travel on the rise, more people are traveling abroad than ever before.
• b.) Global trends, competitors, and supply chains are having a bigger impact on local markets. (Correct answer)
• c.) Global expansion ensures profitability in the long term.
• d.) It boosts a company's image when they hire foreign workers.