Reference no: EM131469483

Globalization is the tendency of investment funds and businesses to move past domestic and national markets to other markets around the globe, by this means its increasing the interconnectedness of different markets. Globalization has had the effect of markedly increasing not only international trade, but also cultural exchange. Comparative Advantage is the ability of a firm or individual to produce goods and/or services at a lower opportunity cost than other firms or individuals. A comparative advantage gives a company the ability to sell goods and services at a lower price than its competitors and realize stronger sales margins. Outsourcing is a practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally. Outsourcing is an effective cost-saving strategy when used properly. It can sometimes be more affordable to purchase a good from companies with comparative advantages than it is to produce the good internally. And globalization gives us the freedom to move out of borders to other countries to find the best source of goods at lower cost. Advantages of outsourcing:1. One of the biggest advantages of outsourcing is cost savings. The lower cost of operation and labor makes it attractive to outsource.2. Outsourcing reduces overhead costs that usually come with running back-end operations.3. A company's cash-flow can be streamlined.4. By increasing productivity and efficiency, a business can be more successful and better-prepared for market challenges.5. Outsourcing gives businesses flexibility in staffing and manpower management. Since the service provider is responsible for managing the workforce, you save costs and can also pick the best people to run your core functions. Regarding policy government will levy import tax to take look on outsourcing. To control outsourcing the government will increase taxes, when outsourcing is in control it will not disturb it. Government will enforce strict laws to govern outsourcing as it involves another country in business.

"Regarding policy government will levy import tax to take look on outsourcing