WGU C211 Global Business (Latest 2023 - 2024)
With Complete Answers 100% Correct
- What are the benefits of trade?
Answer:
1- A greater amount of choice in the availability of goods and services
- - Lower prices for goods and services consumed
- - Higher living standards
- What are the benefits of foreign investment?
Answer:
- Generates jobs
- creates unity by erasing borders
- brings cultural and technical riches
- enhances the skills of domestic workers
- What are the major international trade theories and what are key features of each
one?
Answer:
-Mercantilism -Absolute Advantage
- Theory of Comparative Advantage
- Heckscher-Ohlin Theory
- Factor Price Equalization Theory
- Porter's Diamond Model
- What is the impact of trade policy on various stakeholders such as businesses,
consumers, and governments? 1 / 2
Answer: Gov't actions altering free flow of merch to and from a country
Historically, main instrument has been import tariff (but now, non-tariff barriers and export subsidies are more prevalent)
- What is the rationale for managing trade?
Answer: Refers to agreements, sometimes temporary, between countries (or a group of countries) that aim to achieve certain trade outcomes for the countries involved.
Managed trade aims to replace global market or economic forces with government actions to determine trade outcomes
- Can only gain from trade if it has trade surplus.
More export, less import "I sold more goods than I bought, so I win." gold & silver are very important to country wealth 16th, 17th century Great Brittan
Key words: trade surplus
Answer: Mercantilism
- Whoever produces more has the absolute advantage. key words: specialization &
absolute quantities Criticises mercantilism Proposed by Adam Smith Brazil makes more coffee than the U.S. (win, win) can have as much as you want and trade as much as you want for something different.Increase in living standards
Answer: Absolute Advantage
8. Key word: Opportunity cost
Brazil has coffee beans and if the US wanted to produce coffee beans they would be giving up other opportunities (like corn). Brazil does coffee beans at little opportunity cost.Less opportunity cost=Higher comparative advantage Always pick the item with the least opportunity cost
Answer: Competitive Advantage
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