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INT 610 Multinational corporate environment Assignment




Question;INT 610;1- Should there be higher;business relation between U.S. and Canada or U.S. and Indonesia based on;- Theory of comparative advantage?;- Country similarity (psychic distance) theory?;Explain your answer clearly.;2- Discuss product life cycle;theory of international trade and investment.;3- Using factor price equalization theory to show the impact of;international trade on wage structure of emerging economy (make sure you;explain process of adjustment)?;4- You are sent to manage;subsidiary of a MNE in Argentina. Looking at Hofested?s cultural attribute you;find the following information relative to U.S. Using this information what;adjustment do you make in your management style?;- Power distance;US =31, Argentina =41;- Individualism;US= 100 Argentina= 47;- Masculinity;US= 63;Argentina = 63;- Uncertainty Avoidance: US= 37;Argentina = 75;5- A firm is considering to entry into a;particular country for the first time. While the;senior management thinks that there is great;potential for expansion and profit in the country, they are concern with the;risk and their own ability to function in that unfamiliar business environment.;There are two options available to the firm. One is joint venture and the other;wholly owned subsidiary. Which of the two choices do you recommend and why?;6- In attempting to choose a;country for investment, firm ABC decides, to use a matrix for;country selection. It decides to look at the following factors: 1- economics;2-political risk, 3- cost of labor, 3- tax structure, and 4- country similarity;to home country. On the scale of 1 to 10 (1 being very unattractive and 10;being very attractive) management has ranked each factor and has decided;importance of each one (again 1 unimportant and 10 very important) for the;company. Below is table showing management?s assessment. Company only chooses a;location if its weighted average is 7 or higher. Would company ABC select;country 1 or country 2?;Ranking;Country;1;Ranking;Country;2;Weight;Economic;growth;8;6;9;Political;Stability;4;8;7;Low;Labor Cost;8;6;5;Attractive;Tax structure;6;7;6;Similarity;to home country;7;9;8;7- Discuss how equilibrium is reached in a foreign exchange market if;a country has balance of payment deficit in the case of fixed and floating;(flexible) exchange rate system?;8- If the exchange rate between dollar and Euro is 1.35 $/Euro and;inflation rate in US is 3% and Europe 5% forecast expected exchange rate in one;year using relative purchasing power parity.;9- What would happen to capital flow between two countries if the;real interest rate (rate adjusted for inflation) between the two countries is;not equal and why?;10-Considering the Integration Responsiveness;Strategy Grid, what is the recommended strategy for a firm with low pressure;for national responsiveness and high pressure for global responsiveness;(explain your answer).


Paper#46394 | Written in 18-Jul-2015

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