Assignment
Part 1
1. Why is it difficult to solve international economic problems in the short run?
2. What is a free trade zone? Is it an efficient economic concept?
3. What is meant by the term balance of payments?
4. What are the three major accounts in the balance of payments?
Part 2
1. If your firm had a subsidiary in Japan and about 100 million yen in exposed assets (i.e. plant and equipment), how would you protect it against exchange risk?
2. If you managed the European operations of a large US-based MNE, in what market(s) would you seek long-term funding? Why?
3. If you were offered the opportunity to establish a deposit in London-denominated in euros, would you choose that rather than a deposit in British pounds or dollars? Why or why not?
4. How may the International Monetary Fund affect companies' activities in international business?
Part 3
1. Define the term strategic planning.
2. What is a value chain? How can this chain be used in an internal environmental assessment?
3. What are some typical MNE goals? Identify and briefly describe four major types.
4. One of the most important considerations when implementing a strategy is that of location. What does this statement mean?
Part 4
1. How does an export department structure function? Who handles the overseas sales?
2. If a company's initial international expansion is conducted through the use of subsidiaries, how closely does it control these subsidiaries? Why?
3. When would a company opt for a mixed structure? Why? Defend your answer.
4. How does a matrix structure work? When would an MNE opt for this organizational arrangement?
Part 5
1. Of what value are strategic clusters in the double diamond? Explain.
2. In what way are economic integration/globalization and national responsiveness important to MNE strategies?
3. In the entertainment industry, which is more important, integration or national responsiveness?
4. Based on current developments in the PC market in Japan, which is more important for US MNEs, integration or national responsiveness? Why?