1.Define culture. Which definition in your opinion, is the most appropriate: and why? Provide examples?

●Culture can be defined as all the ways of life including arts, beliefs and institutions of a population that
are passed down from generation to generation. Culture has been called "the way of life for an entire
society." As such, it includes codes of manners, dress, language, religion, rituals, artCulture is a word for
the 'way of life' of groups of people, meaning the way they do things. Different groups may have
different cultures. A culture is passed on to the next generation by learning, whereas genetics are
passed on by heredity.

2.Which needs must be satisfied by culture? Briefly explain each and provide examples.

●Communication, because each person needs it in order to exchange experience, to receive someone
help, to spend good time

●Family, because from ancient times it was much more easily to live out, each person needs people
which will support, don’t betray and to have “пристанище”

●Educational needs, because everybody want to receive desalinized knowledge’s in certain field in order
to use them in his life and receive money

●Aesthetical need, everybody tends to nice, beautiful in order to обогатить себя

●Relational, because we need to explain our life events, we need to have our internal drivers, we need
to understand who we are

●Self-actualization needs, some people need to show oneself in all his life spheres to be the most fluent
person, to have perfect knowledges in some fields, to be on the highest steps o job stairs.

3.Present culture and its elements. Provide examples and relate them to international business.

●Culture gives people a sense of who they are, of belonging, of how they should behave, and of what
they should be doing. Culture impacts behavior, morale, and productivity at work as well, and it includes
values and patterns that influence company attitudes and actions. Culture is often considered the driving
force behind human behavior everywhere.

●Main elements:

- Material Culture

- Language

- Aesthetics

- Religion

- Social Institutions
●Communication and Language. English is used “link” language that is understood by two parties who
speak different languages. For example, Japan-based Sony and Matsushita use English in their work
abroad. Physical gestures, for example, often convey different meanings in different cultures: in Europe
it is norm when woman shake hand to man, but not in Asia.

4.What is the role of each major religion in conducting international business? What do Christianity,
Islam, Hinduism, and Buddhism declare in terms of business?

●Christianity. Christianity is the most widely practiced religion in the world, with about 2 billion people
identifying themselves as Christians and a vast majority of them living in the Americas and in Europe.
importance of hard work and wealth creation and frugality, and this was the underlying value system
that facilitated the development of capitalism. The combination of hard work by the Protestants and the
accumulation of wealth for further expansion and investments prepared the way for the development of
capitalism in Europe and eventuallyin the United States.

●Islam.In economic and financial terms, Islam allows people to make a pro.t, as long as that pro.t is
earned justly and is not based on the exploitation of others. The pro.ts should also be used for charitable
activities and for helping the poor. One economic principle in Islam prohibits the payment or receiving of
interest, which is considered usury.

●Hinduism. Many Hindus believe that the way to achieve nirvana is to lead a severe ascetic lifestyle of
material and physical self-denial, devoting life to a spiritual rather than material quest.

●Buddhism. A Buddhist teaching is that if people have no desires, they will not suffer. This is important
to marketers and production managers because if Buddhists and Hindus have no desires, they have little
motive for achievement and for the acquisition of material goods. Today, Buddhism has approximately
360 million followers, mostly in nations such as China, Tibet, Korea, Vietnam, Thailand, and Japan.

5.Which practical tips would you provide as the most appropriate when it comes to international
business, and why?

●Having Cross-cultural communication skills

Any role or function in international business means working in diverse workplace with people from a
different country or background to yours. Whether they're a colleague, a client, or a customer,
understanding how to communicate across cultures is an absolutely indispensable skill.

1.Explain the difference between autonomous and offsetting (or accommodating) transactions.

Autonomous transactions are independent of the balance of payments in the sense that they are
affected by factors outside the balance of payments statement. These include exports, imports,
transfers, public transactions, and net capital movements. Imports and exports are the result of cost
differences among countries (i.e., international competitiveness). Transfers and public transactions are
based on military, political, or humanitarian considerations (i.e., military aid or humanitarian aid
following natural disasters). Capital movements are dependent on expectations about returns on foreign
investments (i.e., interest rate and exchange rate considerations). On the other hand, transactions
occurring in order to compensate for differences between payments and receipts arising from a
country’s autonomous transactions are called accommodating (offsetting) transactions. In effect, they
are balancing transactions, which finance payments imbalances associated with autonomous
transactions.

2.Since the balance of payments must always balance, how do balance of payments deficits or surpluses
emerge?

Autonomous transactions are independent of the balance of payments in the sense that they are
affected by factors outside the balance of payments statement.

3.Do you agree with the view that a country is in a better position if it experiences a balance of
payments deficit rather that a surplus?

●it depends,When exports are less than imports, it has a trade deficit. On the surface, a surplus is
preferable to a deficit.

4.Assume that the United States decides to adopt a fixed exchange rate system and pegs the dollar in
relation to the euro. Trace out the possible effects on the US economy if (a) inflation is higher in the
United States that in Europe, (b) the markets expect the dollar to depreciate.

●Inflation is more likely to have a significant negative effect, rather than a significant positive effect, on a
currency's value and foreign exchange rate. A very low rate of inflation does not guarantee a favorable
exchange rate for a country, but an extremely high inflation rate is very likely to impact the country's
exchange rates with other nations negatively.