Edexcel Business A Level Revision

Global merger - is an agreement between two companies from different countries to join forces permenantly. They will become a MNC and these types of merger are likely to increase the power of the new business. Joint Venture - a separate business entity created by two or more parties acting as a collective tp set up a new business venture, involving shared ownerships, returns and risks. Patents -  a government authority or licence conferring a right or title for a set period, especially the sole right to exclude others from making, using, or selling an invention. Reasons for a global merger or joint venture; Spreading risk Entering new market/trade bloc Acquiring national/international brand name/patents Securing resources/supplies Maintaining/increasing global competitiveness. SPREADING RISK OVER DIFFERENT COUNTRIES/REGIONS By operating in a number of countries, a business reduces the risk associated with one individual country. This is because all countries will ...

Production - A process of workers combining various material inputs and know-how in order to make something for consumption by the customer, known as the output. Production can also be defined as the total amount of output produced in a time period. The more that can be produced in a specific period of time, the more efficient the business becomes in using its resources. There are 9 factors that have to be considered when assessing a country as a production location; Costs of production Skills and availability of labour force Infrastructure Location in trade bloc Government incentives Ease of doing business Political stability Natural resources Likely return on investment COSTS OF PRODUCTION In highly competitive mass markes, having low costs of production will be a significant advantage. This means low wage cost will see FDI to the country in order to take advantage of the labour force and its low wage costs. This allows businesses to drive costs down, allowing the...