Global Exame Questions 4

Part 1
Question 2 – Bhutan case

Review comparative advantage of country in international trade
A country focuses on economic growth the most by focusing on the industry in which it has the most
substantial comparative advantage.
For example, England was able to manufacture cheap cloth. Portugal had the right conditions to
make cheap wine. I predicted that England would stop making wine and Portugal stop making cloth.
England made more money by trading its cloth for Portugal's wine, and vice versa
Developing acquired advantages
It’s important to understand that an acquisition advantages are distinct from a merger in several
ways. First, an acquisition is the act of buying another business, whereas a merger is a process by
which two companies become one company, though the ownership interests may differ.
One main advantage of buying another business that sells similar product or services is that country
can create economies of scale, which refers to the process of increasing production by lowering
production costs. When country takes on the second business, they can implement the same
marketing and sales strategies for acquired advantages, which lowers costs and helps to boost
productivity.
Question 4
Each country’s political system is relatively unique, having emerged within a particular historical,
economic and cultural context. Review totalitarianism, socialism and democracy.
Question 3 – Apple iPad Case

Apple’s iPad division
Emerging markets, also known as emerging economies or developing countries, are nations that are
investing in more productive capacity. Review the main characteristics of emerging markets and the
main risks and challenges
Question 10
Critically analyse country risk and its effects on company operations. Use a company example and a
country example to explain.
Case study of Company follow for staffing its subsidiaries.
REVISION QUESTIONS: - Those highlighted are coming in exam under Part 1
1. Suppose that after graduation you get a job with Elizabeth Power, a small firm that manufactures
solar-powered consumer goods. The company has previously only focused on the domestic market.
Having completed your coursework in international business, you are aware of the opportunities that
the international market presents for companies like Elizabeth Power. Write a memo to your boss in
which you explain why your company should pursue international business. What are the benefits to
Elizabeth Power of venturing overseas? Explain why firms internationalise.
2. Suppose you get a job as a consultant to the government of Bhutan, a small country in South Asia.
Historically, the country has not been active in the international trade arena and has relied on
agriculture and forestry as the main economic sectors. The country’s new minister of Commerce and
Industry understands the importance of international trade and is keen to develop a national
industrial policy. The minister has asked you to prepare a report that provides details on: (a) how
Bhutan can leverage its comparative advantage in pursuing greater international trade; and (b) how
the country can go about developing acquired advantages.
3. Suppose you work at Apple’s iPad division. Apple initially targeted the iPad in the advanced
economies. As competition from other tablet manufacturer increases, management would like to sell
more iPads to emerging markets. What are the main characteristics of emerging markets that might
make them potentially good markets for iPad? Identify the main risks and challenges that Apple might
encounter in selling the iPad to emerging markets.
4. For business enterprises to thrive, some minimum conditions must be present: recognition of private
property rights and limited government intervention. To what extent may totalitarianism, socialism
and democracy interfere with the ideal commercial environment for firms?
5. The American International Group (AIG) is the largest insurance company in the United States. In the
global financial crisis of 2008/09, AIG faced financial ruin. However, the US Government used taxpayer
money to loan the firm over US$170 billion in exchange for an 80 per cent stake in AIG. A few months
later, it was revealed that AIG had used part of the money (at least US$30 billion) to pay off banks in
Europe, largely for debt obligations it incurred in foreign transactions. US Government officials were
furious. The furore intensified when AIG tried to renegotiate loans with some of its US creditors,
implying that they were less important than the European banks. Suppose you were the chief financial
officer at AIG. What would you have done? How would you handle this predicament? Use the ethical
framework to analyse how AIG might have handled the situation better.
6. Upon graduation, you are hired by Cuesta Corporation, an SME manufacturer of accessories for luxury
cars. Management wants you to conduct research to locate foreign markets with the best potential for
sales. You discover that markets are fairly saturated in advanced economies. But you are aware of
numerous emerging markets that the industry has overlooked. Develop a list of the top five emerging
markets that Cuesta should target. Make sure you justify your choice, based on indicators such as
market size, market growth rate, market intensity and market consumption capacity.
7. Nissan is Japan’s second-largest car company, with annual sales of around US$100 billion. The firm
makes Maxima and Sentra cars, Altima and Infiniti upscale sedans, Frontier pickups and the Xterra and
Pathfinder SUVs. A few years ago, Nissan was on the verge of bankruptcy. Then Carlos Ghosn was
installed as the firm’s CEO. He closed inefficient factories, curbed purchasing costs and introduced new
products. Suppose Nissan asked you to advise it on IHRM issues. What specific HR strategies would
you recommend to Nissan’s top management to enhance further the firm’s performance? How would
you advise top management on international staffing policy, developing global managers, the
preparation and training of employees, and company strategy for international labour?
8. Analyse in detail the five levels of regional integration between nations. Elucidate the role of free
trade agreements in the formation of economic blocs.
9. Explain the global matrix structure. What are its advantages and disadvantages of this approach? Use
a company example to elucidate your answer.
10. Critically analyse country risk and its effects on company operations. Use a company example and a
country example to explain.
Part 2
Case Study from E-book Chapter 19 Page 571 – 572 about Sony
Question 1
IHRM and expatriate; employees who are adept at working effectively in foreign environments tend
to have the following characteristics
Technical competence, self-reliance, adaptability, interpersonal skills, leadership ability, physical and
spouse and/or dependants (Find answers in e-book Chp 19 Page 556
Question 2
Review steps to prepare international managers. Proper preparation and training are crucial. Training
is the process of modifying employee attitudes and knowledge in ways that increase the likelihood of
attaining organisational goals. (Find answers in Chp 19 Page 557
Question 3
MNEs, where headquarters staff often believe that their ways of doing business are superior and can
be readily transferred to other countries. Review how the company promotes global mindsets
Review the company’s training efforts
And how to improve their training as multi-country operations (Find answers in Chp 19 Page 559)
Question 4
Is a direct question from e-book Chap 19 Case question no. 3:
What is your view of Sony’s training efforts? What steps could Sony take to improve its training in
light of its multi- country operations?
Question 5
Review international labour relations which is the process through which management and workers
identify and determine the job relationships that will be in effect at the workplace. (Find answers in
e-book Chp 19 Page 563)
Question 6
Review Workforce reduction; when firms experience downturns or rising input costs, they may have
to resort to workforce reduction. Laying off workers (or making them redundant, as it is referred to in
some parts of the world) is difficult in much of the world due to local norms, regulations or strong
labour unions. Managers need to gain a full understanding of local labour laws and regulations
regarding worker dismissal. The firm should avoid hiring large numbers of employees until managers
understand the type of workforce it needs. For some needs, part-time employees and contract
workers may be a better alternative. (Find answers in e-book Chp 19 Page 566)

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Part 1

Question 2 – Bhutan case

Question 3 – Apple iPad Case

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