Exam (elaborations)
D080.
- Module
- D080 COMPLETED
- Institution
- D080 COMPLETED
Exam of 11 pages for the course D080 COMPLETED at D080 COMPLETED (D080.)
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D080Sure Start is starting a new division for rechargeable batteries in different parts of the
world.
What was the globalization driver of this decision? - ANS-Competition drivers are about
entering new markets to beat competitors. Sure Start has identified a market that does
not have a lot of competition since it is a fairly new market.
Which type of globalization is represented by Sure Start expanding into South America,
Europe, and Asia? - ANS-Economic globalization is the globalization of production,
sales, and finance activities in international markets around the world.
Which antiglobalization argument could lead to Sure Start continuing to maintain its
current factories instead of moving them to Asia? - ANS-Labor in Asia can be cheaper
than in NC, and critics argue that outsourcing manufacturing could lead to job loss in the
home country.
Which action should the U.S. government take to encourage Sure Start to keep electric
battery production in the country? - ANS-Imposing tariffs on batteries made in Vietnam
will make them more expensive.
Which economic system facilitates the global expansion of Sure Start? - ANS-The law
of supply and demand applies to the market economy, and the goods are privately
owned. Government interference is minimum.
Which type of risk will a company reduce if they offer a warranty to the purchasers of the
battery in case of failure? - ANS-Offering a warranty protects the company from the
legal risk of a product not performing to standard.
Which aspect of the International Monetary Fund (IMF) will assist the newly elected
leader in paying the deficit in U.S. dollars, if agreed on by both countries? - ANS-The
IMF's purpose is to provide a way for countries to easily exchange money, provide
financial help to its members, and supervise international economic policies.
Which critical distinction should Country A make when choosing between the World
Bank and the International Monetary Fund (IMF) to improve the country's highways? -
ANS-The World Bank is directly associated with this type of development project.
, Which benefit to the newly-elected leader in Country A stems from using the World
Bank to meet a campaign promise? - ANS-The World Bank provides funds through low
interest or interest-free loans, grants, and credits to help the country develop its
infrastructure.
Why should the newly-elected leader of Country A be careful when working with the
World Bank to eliminate the nation's trade deficit? - ANS-Because of the voting power
highly-developed countries have on World Bank policies
Why should the newly-elected leader of Country A use the World Trade Organization
(WTO) to form favorable trade agreements? - ANS-To receive help building international
exchange capacity. One of the functions of the WTO is to help developing countries
build trade and international exchange capacity so they can have a presence in the
international markets.
Which situation describes how Sure Start is applying the absolute advantage theory?
Adding an office in the South American market to help manage the business throughout
the continent
Expanding into Europe and Asia to supply batteries to electric car manufacturers in
those markets
Moving production of the batteries used in electric cars to Vietnam where labor is less
expensive
Establishing a European headquarters in Germany and moving key leaders to that
country - ANS-The absolute advantage theory states that a country that can produce a
product cheaper or faster than another country should focus on that advantage. Moving
production of the batteries used in electric cars from the United States to Vietnam where
labor is less expensive applies the absolute advantage theory.
Which benefit will Sure Start gain from opening the factory in Vietnam?
They will achieve economies of scale in the production of rechargeable batteries.
It will allow them to move to the production of electric cars in the near future.
The U.S. government will give them subsidies for producing in Vietnam.
The move will allow them to be fully integrated in production of rechargeable batteries. -
ANS-Because the factory in Vietnam will only produce rechargeable batteries, the
company will be able to benefit from minimized production costs associated with lower
labor and dedicated manufacturing operations as they scale up to mass production.
Which action of Sure Start represents the application of the global strategic rivalry
theory?
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