Introduction to international Business PU Spring 2024 question paper

Give two reasons for international business expansion.

List any four assumptions of comparative advantage theory.

Define mercantilism.

List the actors in political and legal system.

Write the two principles of WTO.

Define intellectual property rights.

Mention two key reasons why countries seek foreign direct investment.

Define outsourcing.

Define strategic alliance.

What is diversity management? Section “B” Descriptive Answer Questions Attempt any six questions. [6x10]

Define international trade. Compare and contrast Absolute Advantage Theory and Theory of Mercantilism.

Define culture. How does foreign culture matter for an international business enterprise? Explain with suitable examples. 13. As an international business manager, what methods and analytical frameworks do you use to assess global business opportunities and estimate market potential? Explain. 14. A small footwear brand from Nepal known for its high-quality craftsmanship desires to enter the Indian market. Given the geographical proximity and cultural similarities between Nepal and India, what entry modes would be most suitable for the brand? Analyze the advantages and disadvantages of each potential entry modes. 15. What are the key factors that international businesses need to consider when determining pricing strategies for their products and services in global markets? How do these factors impact pricing decisions and competitiveness? Explain. 16. How do various diversity management practices impact organizational performance and employee satisfaction in multinational corporations? ‘ots FlVieroEnotes Explain. 17. How have emerging trends and issues reshaped the landscape of international business and the contemporary business world? Describe the new trends and challenges that companies face today while operating globally. Section “C” Case Analysis 18. Read the case situation given below and answer the questions that follow: [20] As the financial crisis of 2008 and 2009 unfolded, countries across Europe were hit hard. A notable exception was Poland, whose economy grew by 1.5 percent during 2009, while every other economy in the European Union contracted. Between 2010 and 2012, Poland's growth rate averaged 3.4 percent per annum, the best in Europe. How did Poland achieve this? In 1989, Poland elected its first democratic government after more than four decades of Communist rule. Since then, like many other Eastern European countries, Poland has embraced market-based economic policies, opened its markets to international trade and foreign investment, and privatized many state-owned businesses. In 2004, the country joined the European Union, giving it easy access to the large consumer markets of Western Europe. All this helped transform Poland into a major exporter. Exports account for about 40 percent of gross domestic product (in contrast, they account for around 12 percent in the United States). As a consequence, between 1989 and 2010, Poland recorded the highest sustained growth in the region. Real GDP doubled over this period, compared to a 70 percent increase in neighboring Slovakia and 45 percent in the Czech Republic. Poland's government has also been fiscally conservative, keeping public debt in check and not allowing it to expand during the recession as many other countries did. This led to investor confidence in the country. Consequently, there was no large outflow of funds during the 2008-2009 economic turmoil. This stands in stark contrast to what happened in the Baltic states, where investors pulled money out of those economies during 2008 and 2009, driving their currencies down, raising the cost of government debt, and precipitating a full-blown economic crisis that required the IMF and EU to step in with financial assistance. Poland got lucky. A tight monetary squeeze in the early 2000s, which was designed to curb inflation and ease Poland's entry into the European Union, headed off the asset price bubble, particularly surging home prices that hurt so many other economies around the world. Ironically, the Polish government had been criticized for its tight monetary policy earlier in the decade, but in 2008 and 2009 it served the country well. Moreover, in 2009 Poland benefited from the economic stimulus in neighboring Germany, its 213 erlVieroEnotes $s eperenrep largest trading partner. A scheme to boost demand for German automobile companies by giving cash grants to people who exchanged old cars for new ones (a "cash for clunkers" program) helped Poland because the country has several automobile plants and was selling many cars and components to Germany. None of this is to say that Poland is a model state. The country still has substantial problems. Migrant workers returning from Western Europe have swelled the ranks of the unemployed, which was over 12 percent at the end of 2012. The tax system is complex and archaic. A study by the World Bank put the Polish tax system at 151st out of the 183 countries it surveyed. Extensive regulations can still make it difficult to do business in Poland: The World Bank ranked Poland 62nd in ease of doing business. Even after 20 years, the transition from a socialist economy to a market-based system is still not complete, and many state-owned enterprises remain. On the other hand, the Polish government has committed itself to changing much of this. Steps are being taken to simplify tax laws, reduce tax rates, and remove bureaucratic hurdles to doing business in the country. An example was the Entrepreneurship Law passed in March 2009, which dramatically reduced the number of health, labor, and tax controls that companies had to comply with, making it much easier to start a business in the country. Also, after a six-year standstill, Poland privatized state-owned enterprises that accounted for 0.6 percent of GDP in 2009 and those accounting for another 2.5 percent of GDP in 2010. Questions:

• a) How was Poland able to avoid the worst effects of the economic crisis that gripped most of Europe during 2008-2009?
• b) What lessons can be derived from Poland's experience during 2008- 2009?
• c) From the perspective of international business, what is attractive about the Polish economy? What are the weaknesses and risks associated with doing business there?
• d) Even though Poland has been committed to liberalizing its economy since the collapse of communism in 1989, significant traces of the old system still remain. Why do you think it has taken Poland so long to transform its economic, political, and legal systems? peep 3 of