12. What are ‘blue-chip companies’? Why are they included in many conservative investment portfolios?

It’s a company known for the quality and wide acceptance of its products or services, and for its ability to make money and pay dividends.

They are valued by investors seeking relative safety and stability, though prices per share are usually high. Many blue chips are components of popular indices, such as the Dow Jones Industrial Average and the S&P 500.

Also, blue chip stocks are sometimes defined as companies whose stocks have large market capitalization values (for example, over $1 billion.)

(The term comes from blue-colored chips in the game of poker, which are typically the most valuable.)

13. What factors are of crucial importance for building stable relationships with foreign partners? What courses at high school should a would-be specialist in international economics take to get prepared for effective foreign cooperation?

The most important thing for building stable relationships with foreign partners – is to observe business etiquette. It is the major aspect of moral and professional behavior for any businessmen. Domestic start-up businessmen frustrated a lot of good bargains, especially with foreign companies, because they don't know rules of business etiquette. Also it is necessary to consider customs, traditions and habits of representatives of those companies or countries with whom you want to cooperate. In practice of business relations there always will be some standard situations which can't be avoided. Special forms and behavior rules were developed for these situations. Always it is necessary to consider interests of partners even if they don't coincide with yours.

For the specialist in international economics participation in some international programs, economic conferences and organizations are very important and useful; there we can gain necessary experience. But before these we must learn the principles and concepts of economy, marketing and management, also business etiquette and we must know how to use this knowledge.

15. What kinds of risks are generated by globalization?

The global economy has undergone three major changes that profoundly alter the nature of country risk. Firstly, increasing interdependency generates a greater cyclical risk. Secondly, unequal distribution of the results of economic growth creates new socio-political risks in certain countries, and lastly, the persistent global financial instability creates further volatility in the mature economies. The difficulties faced by one country have now become a problem for all, particularly in a global economy that is experiencing a slow down in growth.