The Economics of Global Business Challenges Assignment
Assessment 1 - Authentic tasks - Case study analysis report
CASE STUDY ANALYSIS - Hana: Financial Analyst or Pineapple Grower?
1. Statement of the Case Study
The present case study is of particular relevance for people willing to run a small business in the real world. Hana was a financial analyst earning $78,000 per year but she decided to take advantage of the globalization of the world economy. She was residing in a tax heaven country with tax rate on profits equal zero. To this end, she undertook activities as a pineapple grower attracted by the fact that a pineapple grower could sell any quantity of pineapples at $5.00 per kilo. She decided to produce 44 tonnes of pineapples.
The costs of production incurred for this level of output were as follows: payments for land and equipment rental and for other supplies $36,000 per year; labour costs $44,000 per year; transportation costs $ 30,000; and administrative costs $10,000 per year. The only two inputs she supplied to her new business were her savings ($20,000) withdrawn from a special account paying a rate of interest of 10% per year and her own labour. Hana wanted $20,000 as a return for risk-taking. By mid-year, she took out $25,000 from the firm for her living expenses but she never returned a single cent. At the end of the year, she was uncertain about the profit earned and decided to consult an accountant and an economist. When she received the reports from the accountant and the economist she was confused and asked them whether it would make sense for her to remain in business. As to the responses, the accountant assumed no change in the economic circumstances for next year, but the economist predicted a jump in the price of pineapples from $5.00 to $10.00 per kilo with everything else remaining constant.
2. Your task
You have to write a Business Report where you address the following issues:
(a) Profit figure that the accountant arrived at;
(b) Profit figure that the economist arrived at;
(c) Price elasticity of the demand curve facing Hana's firm; and
(d) Whether or not it is a good idea for Hana to remain in business.
Assessment 2 - Authentic tasks - Case study analysis report
CASE STUDY ANALYSIS - Investing in Australasia: Australia or New Zealand?
1. Statement of the Case Study
A French science-based company -called Frenchy Innovation- is committed to socially responsible commerce and wants to expand its innovation activities to Australasia. Frenchy Innovation is a big multinational company. The business challenge is to select an Australasian country with a competitive advantage in venture capital availability, capacity for innovation, and availability of scientists. Competitive advantage in domestic market size is desirable but not necessary. The CEO of Frenchy Innovation has received a report from an external consultant based on the Global Competitiveness Report 2016-2017 (for short, WEF (2016)), stating that both Australia and New Zealand currently occupied a high overall competitive position within Australasia, but New Zealand is the correct choice due to the fact that this country happens to be within the top fifteen performers in the world ranking and Australia is not an innovation-driven economy. The CEO is not convinced with the choice suggested by the consultant because she is unable to see explicit statements about the competitive advantages of Australia and New Zealand in relation to the above mentioned factors. She requires more information before making a final decision.
2. Your task
You have to write a Business Report to make a concrete recommendation. You have to address the following issues:
(a) Position on the economic development path of Australia and New Zealand, according to WEF (2016);
(b) Overall competitive position of Australia and New Zealand according to WEF (2016);
(c) Choice of country based on overall competitive position of Australia and New Zealand;
(d) Rule for the evaluation of the national competitive advantages of Australia and New Zealand;
(e) Choice of country based on the four key factors: venture capital availability; capacity for innovation; availability of scientists; and domestic market size; and
(f) The reasons for your explicit recommendation concerning country choice.
Assignment Files -
https://www.dropbox.com/s/szbkh90yj0f8kk6/Assignment%20Files.zip?dl=0