MIDTERM EXAMINATION International Business 670 July 18, 2016 This exam was posted on the class Moodle website on July 11, 2016 and is due back on the...

Explain Vernon’s product cycle in terms of the global development of the market for pharmaceuticals and software and the development of the Indian drug and software industries as described in the text and the case presentations.           

Explain Porter’s Diamond and how Nokia’s development as an international mobile telecom company illustrates each aspect of Porter’s theory.

Large MNEs dealing in multiple markets constantly face exchange rate issues that if not properly managed can have severe adverse consequences. Explain how the VW and JAL cases illustrate this point and how they could have better managed their exposures.

Explain Absolute, Comparative and Competitive Advantage and how Intel and Toyota are examples of all three concepts.

Explain briefly the US Foreign Corrupt Practices Act, why it applied to a foreign company such as Siemens. Then describe Siemens’ corrupt practices, how it was caught and prosecuted, and how and why it has worked to change its culture.

Software, movies and pharmaceuticals are particularly subject to piracy but firms such as Exxon, Intel or GM producing oil products, ICs or autos, do not face these problems despite their well-known brands and trademarks. Explain the economics of why this is so.

Explain privatization and why given GE’s experience in Hungary it is now interested in pursuing privatized FDI in Myanmar as described in the text and case presentation.

 Country A has 3500 units of labor and can produce two goods, manufactures and food. A’s producers take 7 units of labor to produce one unit of manufactures and 2 units to produce one food unit. Country B has 4500 units of labor and takes 5 units of labor to produce one unit of manufactures and 10 units to produce one unit of food. At what price of food in terms of manufactures would A and B respectively supply food? Would trade take place in between A and B in Adam Smith’s world? How many food units could B supply?

US exports oil at the world price, $45 per barrel. The domestic supply curve in barrels per day is S = 7,500,000 + 1,500,000P with P in dollars. Domestic demand curve is D = 15,000,000 – 500,000P. Draw the US demand and supply curves for oil and indicate how many barrels are exported per day and the value per year.

Companies can face cultural problems that impact their business prospects even in developed countries. Explain how Walmart’s experiences in Germany and Japan and Disney’s experiences in France support this statement.

I have also attached the file for reference so that the numbers can be easily followed