A number of major corporations are reincorporating and moving their corporate headquarters to countries like Switzerland, for tax purposes. The question is: Should the U.S. Congress step in and pass a law strictly limiting the ability of U.S. corporations to reincorporate elsewhere if they want to continue significantly operating in the United States?

A law of this kind will surely make challenges because a tax of 30% that is higher than the other countries will surely lead the U.S to different problems and different challenges because high taxes will become a barrier in trade and the import and exports of the products, these barriers will affect the economy and the U.S incorporated businesses will not compete in the market and this will affect the business companies and the shareholders, the investors will not invest in the companies and the business industries will be in laws and different incorporate business industries will move their headquarters in different countries because of the large amount of taxes the U.S has implemented and this will affect the business in the U.S and it will also affect the development of the economy, if all the incorporated Businesses shift their headquarters in some other countries, they can expand their business in the other countries and the U.S will be left empty handed destroying the economy of the U.S. The laws that should be made are for the development of the economy not for destroying the economy. Before developing a law and implementing it, we should identify the consequences that can occur from it.

Question 2

Differentiate between the International Monetary Fund and the World Bank as institutions facilitating globalization.

IMF is basically an internationally recognized organization that maintain the monetary system al around the world, means globally. The major aim of this organization as a global institute is that it focus on the economic stability of the country. Main operation of this organization is to provide assistance and to deal with all the problems and the issues that are related with the macroeconomics and the financial sector. The IFM is basically a unitary organization. IMF is smaller than the World Bank, it works on a small scale as compared to the World Bank. On the other hand, World Bank is a global organization that helps in establishing the financial conditions and gives advice to the nations that are developing, so that they can become more developed economically. The major aim of the World Bank is to establish the economic growth in the developing countries. The major operations that are carried out by the World Bank is that it facilitate the lending process. And the major objective of the World Bank is to decrease poverty in a country and promote the economic development of a country for a long term.

Question 3
Defend the infant industry argument, using specific examples.

Infant industries are that industries that are in the developing process and has not developed properly with all the resources to compete in the market and export their products. The infant industry should be protected from the international trade because these industries are not stable economically and does not have proper resources as compared to their competitive industries that are old and have all the resources, so these industries need to be protected until they become stable and have all the resources to compete in the market. The main reason of protecting infant industry in the country is to promote the national security and reduce the reliance on the production from different parts of the countries or from abroad. The infant industries are a source to generate revenue for the government once they become mature because they can attract the foreign investment and it will create more employment opportunities at local level and it will develop the local and domestic market as well. And an advantage to protect the infant industry that it can grow without any competition and it will develop more becks it will not be burdened by the competition and can develop more successfully and will bring great outcomes for the country when it will become mature and can compete in the market with more strength and more resources.

Question 4

Describe the economic and political risks faced by companies doing business in global arena.

The economic risks that are faced by the companies that are doing business in the global arena is that there will be high interest rate and this will affect the company and the company can get the proper resources as well as the consumers buying power will be affected. Moreover market prices also affect the company because when the company is running a business in the global arena it has to deal with different markets and in different markets prices vary, in some markets the price may be too high and it will affect the company and its supply into the different markets, other economic risks include the taxes, minimum wage and the cost of the materials. The political risks that the companies face include the unstable government, if the government is unstable then how will the government support the businesses in their country. Secondly the lack of the strong foreign trade policy is another risk, if trade policies are not developed in the country then the business depend on the power from the government and if government is not stable, how will the business will run. Moreover government who is stable and earning proper income will not be business friendly and the government might increase the quotas and the tariffs.

Question 5
Explain the pros and cons of regional integration.

The major pros and cons of the regional integration depends on how the strong the relation is between the two regions and what kind of agreements they both look upon. The pros of regional integration include the Trade gains, trade will be supported with this regional integration, the export and import of the goods will support the economy of both the regions and moreover regional integration will expand the markets of both of the regions and they can produce more products and can sell these products in the bigger market. The cons of the regional integration include the limitation of the fiscal capabilities, regional integration can lead to fiscal crisis and cannot supply their own currency that suits economic conditions of the nations. Another disadvantage include the cultural centralization, regional integration will lose the cultural system of the country and it will result in the loss of the unique minorities within the culture of the region. The regional integration has many pros and cons but all the pros and cons depend upon the type of agreement that has been made within both the regions because if the agreement is effective then there might be chances of no cons there will only will pros and advantages of the regional integration.

Question 6

Defend the following statement: Trade and foreign investment are good for society.

Trade and foreign investments are good for the society and both the things have positive impact on the society. Trade is beneficial in term that it promotes the economic growth of a country, its efficiency, the technological processes and the most important thing is the consumer welfare. Trade has benefit on the middle and lower income households and the domestic and local people living in the society because trade will be carried out in an expanded market and it will also increase the variety of the products in the market. Foreign investments are good in the sense that it benefits the global economy and it also benefited the investors and the recipients. Due to the investors, the businesses will be provided with the best capital and resources and the investors will get the best possible profit in return. The recipients that receive the funds from the investors will expand their production with more resources and their products and services will reach efficiently in the market. The country will gain benefit from the trade and the foreign investments in the form of net exports and it will increase the GDP of the country and this will also help in reducing the cost of the products for the local citizens of the country.

Question 7

Analyze the impact of transparency on globalization.

Transparency have a positive impact on the globalization and it will benefit the country and its economy. Transparency will play a major role in the development of the country by providing the prevention from the corruption and it will also promote good governance in the country. It will have a positive impact on the productivity of the country or the nation and also on the economic growth. Transparency can also support the responsible practices and it can promote these practices directly and indirectly like transparency will expose the corruption of the government, it will show the collection of the domestic taxes that has been increased in the country, and moreover it will also reduce the scope of the government to generate revenue illegally or offshore. Transparency will protect the economy of a country and support the country with legal advisories.

Transparency is important in the terms that it will expose the country on a global level and no country can perform any illegal actions to hurt the citizens and can take benefit form the local citizens. Transparency also provides benefits in terms that if a country is well developed then other countries will be impressed from this count try and can loop upon the country for help in any case.

Question 8

Briefly describe any four elements of culture. Provide an example of each.

The first element of culture is the religion; religion is the basic element of the society, the beliefs and the traditions of the society is following.

Second element is the language, that what are the language that are used in the society and the communication systems of the society, the speech traditions, the writing techniques, the symbols which they use in their communication system.

Third element is the Politics of the society, that what kind of government prevails in the country and what are the laws and policies of the country and what rules of leadership are followed in the country and how the leader is dealing with the pole of the society and if he is giving equal rights to his citizens or no.

Fourth element of culture is the geography of the region, that what type of climate prevails in the region, what is the topography of the region and if the regions has a plain land or a plateau or is a mountainous area, because these business practices will be performed according to the topography of the region. The culture of the country is important factor in developing an economy and make it more stable.

Question 9

Counterfeit goods continue to enter the United States in massive numbers. Indeed, in recent years the U.S. Customs and Border Protection Service has seized over 15,000 different shipments of counterfeit goods per year, including clothing, watches, and handbags. What are some ways the U.S. government can make its anti- counterfeiting actions more effective?

U.S can make the anti-counterfeiting actions more effective by the technological advancements, because these advancements will enhance the level of expertise in the counterfeiting community and the technological processes will improve the accuracy in identify the counterfeit actions and reducing these actions. A program should also be developed in order to evaluate the previous and new counterfeiting methods in order to improve the anti-counterfeiting actions and make the more effective. Moreover changes should be implemented in the policies so that there will no threat and the counterfeits cannot use the nonimpact printing reprographic technology. U.S can set the priorities in order to identify the biggest offenders and what are these offenders offering in the market, so that we can address them first. The U.S should become a difficult target for the counterfeit to reach them, a difficult target is not easy to catch. These are all the factors that can make the U.S effective in anti-counterfeit actions and they can be successful in seizing the counterfeit goods.

Question 10

When you read business news, you will note that the Doha Round of trade negotiations have been stalled, partly reflecting the fact that both the United States and the European Union are unwilling to cut agricultural subsidies to their farmers. Unless the cuts are made, other countries, especially the emerging market economies, will be unwilling to further reduce tariff barriers in other sectors. The United States has decided to use bilateral (e.g., with Colombia) or other forms of regional trade instead. What do you think?

The United States has decided to use the bilateral and other forms of regional trade because other countries are not reducing the tax barriers or the tariff barriers and this will be a disadvantage for the U.S as they have to pay more taxes s to the countries while exporting their goods in the other countries. Because tariff will make the products more expensive in the market of the other countries and people will not buy expensive products and this will result in the downfall of the market, so U.S should move towards other countries or other regions to do the trade that is anti-tariff trade. And the two regions can do the trade easily without any trade barrier and can develop their economy more strongly.