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WGU C211 - GLOBAL ECONOMICS FOR
MANAGERS QUESTIONS WITH DETAILED
VERIFIED ANSWERS
Views on Globalization Ans: New, Evolutionary, and Pendulum
"New" view on globalization Ans: A force sweeping through the world in
recent times.
"Evolutionary" view on globalization Ans: A long-run historical evolution
since the dawn of human history
"Pendulum" view on globalization Ans: One that swings from one
extreme to another from time to time
Foreign Direct Investment Ans: Direct investment in, control, and
management of value-added activities in other countries
Political views on FDI Ans: Radical View, Free Market View, Pragmatic
Nationalism
Benefits to a country receiving FDI Ans: Capital Inflow, Technology
Spillover, Advanced Management Know-How, Job creation
Costs to a country receiving FDI Ans: Loss of Sovereignty, Adverse
effects on competition,
Capital outflow.
How do resources and capabilities influence the competitive dynamics of
a business? Ans: Resource similarity and market commonality can yield
a powerful framework for competitor analysis.
Resource similarity Ans: The extent to which a given competitor
possesses strategic endowment comparable, in terms of both type and
amount, to those of the focal firm.
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How does resource similarity impact competitive dynamics? Ans: Firms
with a high degree are likely to have similar competitive actions.
(Starbuck's instant coffee & McDonald's iced coffee)
Classical theories of international trade Ans: Mercantilism, Absolute
advantage, and Comparative advantage
Modern theory view Ans: Dynamic
Classical theory view Ans: Static
Absolute advantage Ans: The economic advantage one nation enjoys
that is superior to other nations
Comparative advantage Ans: The advantage one economic activity
nation enjoys in comparison with other nations (relative, not absolute)
Mercantilism Ans: A theory that suggests that the wealth of the world is
fixed and that a nation that exports more and imports less will be richer.
Features of the product life cycle? Ans: New, Maturing, and
Standardized
Strategic trade Ans: Intervention by governments in certain industries
can enhance their odds for international success.
How are supply and demand related to the exchange rate of a country?
Ans: The price of a commodity, a country's currency, is fundamentally
determined by this. Strong demand leads to price hikes; oversupply
results in price drops.
Which theory came first? Ans: Mercantilism (although both are of the
idea that governments should actively protect domestic industries from
imports and vigorously promote exports)
If a company seeks to limit foreign exchange rate exposure in the
forward direction, what is the most effective way to do this? Ans:
Forward transactions, an act know as currency hedging.
WGU C211 - GLOBAL ECONOMICS FOR
MANAGERS QUESTIONS WITH DETAILED
VERIFIED ANSWERS
Views on Globalization Ans: New, Evolutionary, and Pendulum
"New" view on globalization Ans: A force sweeping through the world in
recent times.
"Evolutionary" view on globalization Ans: A long-run historical evolution
since the dawn of human history
"Pendulum" view on globalization Ans: One that swings from one
extreme to another from time to time
Foreign Direct Investment Ans: Direct investment in, control, and
management of value-added activities in other countries
Political views on FDI Ans: Radical View, Free Market View, Pragmatic
Nationalism
Benefits to a country receiving FDI Ans: Capital Inflow, Technology
Spillover, Advanced Management Know-How, Job creation
Costs to a country receiving FDI Ans: Loss of Sovereignty, Adverse
effects on competition,
Capital outflow.
How do resources and capabilities influence the competitive dynamics of
a business? Ans: Resource similarity and market commonality can yield
a powerful framework for competitor analysis.
Resource similarity Ans: The extent to which a given competitor
possesses strategic endowment comparable, in terms of both type and
amount, to those of the focal firm.
, Page | 2
How does resource similarity impact competitive dynamics? Ans: Firms
with a high degree are likely to have similar competitive actions.
(Starbuck's instant coffee & McDonald's iced coffee)
Classical theories of international trade Ans: Mercantilism, Absolute
advantage, and Comparative advantage
Modern theory view Ans: Dynamic
Classical theory view Ans: Static
Absolute advantage Ans: The economic advantage one nation enjoys
that is superior to other nations
Comparative advantage Ans: The advantage one economic activity
nation enjoys in comparison with other nations (relative, not absolute)
Mercantilism Ans: A theory that suggests that the wealth of the world is
fixed and that a nation that exports more and imports less will be richer.
Features of the product life cycle? Ans: New, Maturing, and
Standardized
Strategic trade Ans: Intervention by governments in certain industries
can enhance their odds for international success.
How are supply and demand related to the exchange rate of a country?
Ans: The price of a commodity, a country's currency, is fundamentally
determined by this. Strong demand leads to price hikes; oversupply
results in price drops.
Which theory came first? Ans: Mercantilism (although both are of the
idea that governments should actively protect domestic industries from
imports and vigorously promote exports)
If a company seeks to limit foreign exchange rate exposure in the
forward direction, what is the most effective way to do this? Ans:
Forward transactions, an act know as currency hedging.
