Answer to Question 1
In addition to profit-seeking focal firms in international business, there are numerous non-profit organizations that conduct cross-border activities. These include charitable groups and non-governmental organizations (NGOs). Nonprofit organizations pursue special causes through their international activities. They may serve as advocates for the arts, education, politics, religion, or research. They operate internationally either to conduct their activities or raise funds.
Examples of non-profit organizations include the Bill and Melinda Gates Foundation and the British Wellcome Trust, which support health and educational initiatives. CARE is an international non-profit organization dedicated to reducing poverty.
Answer to Question 2
In terms of political and legal systems, managers must be able to navigate difficult regulations and practices and avoid unethical or questionable conduct. At the same time, the political and legal context can present opportunities. Preferential subsidies, government incentives, and protection from competition reduce business costs and influence strategic decision making. Many governments encourage domestic investment from foreign MNEs by offering tax holidays and cash incentives to employ local workers.
On the other hand, political or legislative actions can harm business interests:
-Laws and regulations unfavorable to foreign firms
-Inadequate or underdeveloped legal system
-Bureaucracy and red tape
-Corruption and other ethical issues
-Government intervention, protectionism, and barriers to trade and investment
-Mismanagement or failure of the national economy
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