Question

Chapter 3 Cultural environment How is culture like an iceberg? In a short essay, explain the relationship between the iceberg theory and international business relationships. Chapter 5 Trade theories Why do nations trade? What would the world be like without international trade? Chapter 6 Political and legal system • Compare and contrast common law with civil law specifically as the two systems relate to international business. Chapter 7 Government intervention and regional economic integration • In a short essay, describe two methods of government intervention and explain the four major defensive motives for government intervention

Answer 1

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Iceberg is a metaphor used for culture .Culture is like an iceberg.Many aspects of culture are not visible and only a small aspect is  visible just as  only one eight of iceberg is visible and the rest is under water.. Some  aspects of culture can only be guessed or understood as the culture grows.The iceberg theory states that it is not possible to see or find most of the data related to the situation.  The upper portion of the iceberg shows elements of culture which can be seen such as food ,clothes  etc. Certain elements of culture as the dressing style of people or the eating habits of people are represented byiceberg which is under water.Misunderstanding takes place while  doing business internationally, because of failure to comprehend those parts of culture that lie underwater.   Thus cultural clash can take place in international business because of the coming together of visible and invisible elements of two cultures.Without understanding culture theory, it will be difficult to do business on international basis as there will be misunderstanding and loss of money and time.