Global Economics for Managers WGUC211. ( Exam Review questions and answers, 100% Accurate) 2024

Explain the New, Evolutionary, and Pendulum views of Globalization. How do these differ from one another? - -New- a new force sweeping through the world in recent times. Evolutionary- a long-run historical evolution since the dawn of human history. Historians are debating whether globalization started 2,000 or 8,000 years ago. The earliest traces of MNEs have been discovered in Assyrian, Phoenician, and Roman times. Pendulum- a pendulum that swings from one extreme to another from time to time. Pendulum view suggests that globalization is the "closer integration of the countries and peoples of the world which has been brought about by the enormous reduction of the costs of transportation and communication, and the breaking down of artificial barriers to the flows of goods, services, capital, knowledge, and (to a lesser extent) people across borders." What is foreign direct investment? - -FDI is direct investment in, control, and management of valueadded activities in other countries. The direct, hands-on management of foreign assets. A US manager managing a foreign operation. What different political views exist on FDI? - -Radical view- The radical view is hostile to FDI. Tracing its roots to Marxism, the radical view treats FDI as an instrument of imperialism and as a vehicle for exploitation of domestic resources by foreign capitalists and firms. (no longer a popular view) Free Market view- The free market view suggests that FDI, unrestricted by government intervention, will enable countries to tap into their absolute or comparative advantages by specializing in the production of certain goods and services. Free market-based FDI will lead to a win-win situation for both home and host countries. Since the 1980s, a series of countries, such as Brazil, China, Hungary, India, Ireland, and Russia, have adopted more FDI-friendly policies.