Midterm Review

Question 1

globalization of markets

Answer 1

-facilitated by offering standardized products
-do not have to be a big company to participate
–firms w less than 500 employees account for about 30% world trade by value
-opportunities to expand internationally and threats to your home market

Question 2

globalization of production

Answer 2

-“source good/service around the world for differences in cost and quality of factors of production (labor, energy, land, capital)
-firms hope to lower their cost structure / improve quality or functionality of their product offering (ie, increase competitiveness)

Question 3

drivers of globalization

Answer 3

-role of tech change
-declining trade and investment barriers (politics and regulations
->economic change

Question 4

tech change

Answer 4

-made globalization of markets and production a reality
-advances in
–microprocessors and telecom
–internet
–transportation tech

Question 5

drivers of globalization: politics and regulations

Answer 5

-the increasing significance of MNE
–new ‘global’ division of labour and production chain

-emergence of global institutions
–General Agreement on Tariffs and trade (GATT)
–world trade organization (WTO)
–International Monetary Fund (IMF) and world bank
–UN
–G20

Question 6

changing nature of the global economy

Answer 6

4 trends are important
-changing world output and world trade picture
-changing foreign direct investment picture
-changing nature of the multinational enterprise
-changing world order

also, issues of global pandemic