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The prime minister of your chosen country feels that local infant industries must be protected through the use of trade restrictions. She believes that your product is part of an industry in which companies within her country should be given an advantage. More specifically, she will use her influence to provide tax breaks and additional subsidies to businesses originating within this foreign country within your industry. You must provide the prime minister the following:
1. Reasons why this is not in this foreign country’s long-term interests
2. Reason to believe that both horizontal and vertical FDI of your product in this country will be viable for your chosen country
3. Compelling argument of why FDI is better than licensing for both your company and the country you are investing in
4. The geographic advantages to your CEO regarding investing in FDI related to this product in your chosen foreign country
Research and define Capital Asset Pricing Model (CAPM) and Arbitrage Pricing Theory (APT). How are they the same and how are they different?
The number of people employed in a city was 128,000. The adult population was 201, 000 and the labor force participation rate was 67%. Based on the figures listed above, what is (1) the unemployment rate, (2) labor force participation rate, (3) numbe..
Consider two firms: a yoga studio and a bar. The bar produces noise which reduces the price that the yoga studio can charge from its customers.Assume that the bar can sell an unlimited amount of drinks at the market price p and its marginal cost incr..
Assume that the wholesale skim milk market is perfectly competitive. Suppose demand is described by P=5.10-0.80Q and supply is described by P=1.90+0.20Q. If there are no price controls, what would be the equilibrium quantity?
Identify one product that is commonly bought and sold in the economy that has experienced a recent price change. Based on your understanding from the readings and the other material from this module, provide three reasons why you think that price has..
An entrepreneur is deciding whether or not to open up a new gym. He currently makes $50,000 per year as a personal trainer and will have to give up this job if he opens the gym. If he opens the gym, it will cost $100,000 per year in rent and other op..
Assume that at the current price, the price elasticity of demand for a campus film series is 1.40. If the objective of the film society is to maximize its total revenue.
Set up a Ricardo-type comparative advantage numerical example with two countries and two goods. Distinguish “absolute advantage” from “comparative advantage” in the context of your example. Then select an international terms-or-trade ratio and explai..
A nation will gain from trade if it:
There are, on average, 150 new migrants entering Hong Kong from the mainland every day. Use a diagram to explain how this affects the equilibrium wage and quantity of labour in Hong Kong.
q.assume that the most efficient production technology available for making vitamin pills has the cost structure given
When the absolute value of the own price elasticity of demand is zero, demand is:
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