Problem: You have been recently hired by a multinational firm that manufactures airplanes parts. They are interested in investing in a new factory. However, the CEO is unsure of where they should invest. The CEO would like to either invest in a developed or a developing country and your input is valuable to his decision. Your focus will be on providing specific information on both a developed and developing country, providing that both countries have data for the last 20 years. You will need to provide support, through your analysis, for which country you think will be best for this factory to invest in. Do not pick a country that does not have data that is easily accessible.
Be sure to include the following items in your paper:
- Select a developed and developing country.
- Explain why you selected those particular countries.
- Analyze four economic indicators that are important for the two countries you selected.
- Describe these indicators and why you selected them.
- Compare and contrast their fiscal and monetary policies during a recent economic growth and recessionary periods. How have their policies lead to economic stability?
- Evaluate two recent trade policies in the countries that you have selected. Explain the impact of these policies on your investment.
- Choosing one of the two countries, analyze their decision to reduce trade restrictions, such as how import tariffs affect the ability to borrow in the world capital market.
- Examine the currency of each currency and explain how that will influence your investment.
- Provide a conclusion, supported by academic research, for which country you would recommend to the CEO.