International Business: The Example and Explanations in Economics

International Business: The Example and Explanations in Economics
International Business: The Example and Explanations in Economics

International business is the activity of buying and selling goods and services between countries. Residents of a country can trade with residents of other countries on the basis of mutual agreement.

The population in question can be between individuals (individuals and individuals), between individuals and the government of a country, or the government of a country with the government of another country. In many countries, international trade is one of the main factors to increase GDP.

Although international trade has existed for thousands of years, its impact on economic, social, and political interests has only been felt in recent centuries. Quoting the book Economics 2 for SMA/MA Class XI by Agus Mahfudz, et al., the international business also contributes to industrialization, transportation progress, globalization, and the presence of multinational companies.
There are many examples of international trade taking place globally. Anything? To find out, see the following explanation.

International Business and Examples

Distinguishing Examples of international trade by type. Citing the book Economics Module for SMA Class XI by Sri Nur Mulyati, here are the types of international trade and examples that you can see:

Export

Export is the activity of selling goods abroad. For example, when Indonesia exports clothing to the United States. That means Indonesia is a country that sells clothes. There are two ways to export, namely normal export and export without L/C.
The difference between the two lies in the use of a letter of credit as a means of payment. Ordinary exports are sales abroad with all applicable provisions, then shown to the buyer using L/C. Meanwhile, Exports without L/C can occur if they get special permission from the trade department.

Import

Import is the activity of buying goods from abroad. Imports are the opposite of exports. That is, if the United States buys palm oil from Indonesia, then we can say that the United States imports palm oil.

Barter

Is a transaction in exchanging goods with each other. Bartering is done by first determining the value of an item, then it is paid back with goods that have the appropriate and agreed value. For example, Indonesia exchanged planes for Thai sticky rice, and Pepsi was exchanged for Soviet warships.

Consignment

Transactions with the “goods deposit” system, in other words, are consignments. In an international context, the goods they want to sell are “entrusted” to the international market before waiting for a buyer. Sales can be made through the free market or trade exchanges by means of auctions.
An example of consignment trading is the action figure business. Currently, there are 5 companies that control the action figure business, namely Mattel, Namco Bandai, Lego, Hasbro, and Jakks Pacific. collectors could not find all of these toys in Indonesia, so collectors had to look for them abroad.

Package Deals

Is an international trade activity that is useful for expanding the market of a product. This system makes a trade agreement with a country. The contents of the agreement are in the form of provisions regarding the number of goods they will export to other countries or they will import to certain countries.

Border Crossing

Border Crossing is a trade that occurs in countries that border each other and are based on certain agreements. The purpose of this trade is to make it easier for residents in border countries to shop.