Market Imperfections. MNEs strive to take advantage of market imperfections in national markets for products, factors of production, and financial assets. Large international firms are better able to exploit such imperfections. What are their main competitive advantages?
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Market Imperfections. MNEs strive to take advantage of market imperfections in national markets for products, factors of production, and financial assets. Large international firms are better able to exploit such imperfections. What are their main competitive advantages?
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- What processes and steps can be took to compete with an MNC by a domestic rival company so that they can remain in the market?THE Samsung Electronics factory in Thai Nguyen, in northern Vietnam, employs more than 60,000 people. Its three canteens serve some 13 tonnes of rice a day. It churns out more mobile phones than any other facility in the world. It and Samsung Electronics’ other factories in Vietnam produce almost a third of the firm’s global output. The company has invested a cumulative $17bn in the country. But Samsung is as important to Vietnam as Vietnam is to it. Its local subsidiary’s $58bn in revenue last year made it the biggest company in Vietnam, pipping PetroVietnam, the state oil company. It employs more than 100,000 people. It has helped to make Vietnam the second-biggest exporter of smartphones in the world, after China. Samsung alone accounted for almost a quarter of Vietnam’s total exports of $214bn last year. All this has been a huge boon to Vietnam’s economy. Despite unflattering reports about working conditions in Samsung’s factories, Thai Nguyen and another nearby province that hosts…Question 1 a) How would the differences in efficiency of factors of production internationally affect the concept of factor price equalization according to the Hecksher-Ohlin(H-O) model. b) What arguments would you use for the subsidization of diary products in the home country while the diary industry in dominated by a neighbouring country ? What are the weaknesses in those arguments?
- How to enterprete a business with 1:1 ratio and the one with 0.23:1 ?Mr. Schmidt Hanz was chosen by his company to establish a subsidiary office in Oman. He was hesitant about accepting the mission since he has never travelled outside his country, Germany. It seemed like he did not want to be introduced or exposed to a new culture, and was afraid of this "foreignness". What is Mr. Schmidt experiencing? * O Ethnocentrism O Xenophobia O Stereotyping O Cultural pluralismYour pharmaceutical firm is seeking to open up new international markets by partnering with various local distributors. The different distributors within a country are stronger with different market segments (hospitals, retail pharmacies, etc.) but also have substantial overlap. a. In Egypt, you calculate that the annual value created by one distributor is $60 million per year, but would be $80 million if two distributors carried your product line. How much of the value can you expect to capture? b. Argentina also has two distributors with values similar to those in Egypt, but both are run by the government. How does this affect the amount you could capture? c. In Argentina, if you do not reach an agreement with the government distributors, you can set up a less efficient Internet-based distribution system that would generate $20 million in value to you. How does this affect the amount you could capture?
- Explain why investment in agricultural R & D is a case of market failureWhat are the Global and Regional Economic Integration of LG Electronics?Many US and European Multinationals have expanded in Asian countries and have established manufacturing and sales operations there. Why do you think this region of the world holds so much interest for multinational companies? What are the advantages and potential disadvantages?
- Please explain the importance of government intervention in Japanese industrial policy. (Hint:Ministry of International Trade and Industry-MITI)Which of the following allows a foreign company to sell a company’s products or use its intellectual property in exchange for royalty fees?Choose one answer. Joint venture Licensing agreement Strategic alliance OffshoringWhich one of the following statements about inter-industry study in industrial organisation economics is not correct? A. It is confined to studying a single industry, therefore does not allow variation in market size. B. It allows to study a crosssection of many industries, so that it is possible to investigate the relationship between market size and concentration. C. It allows to study a crosssection of many industries, including comparing the same industries with varing sizes of markets. D. It allows to study a crosssection of many industries, including comparing the same industries in different countries.