Economics IP 4


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    As a business owner making a final decision regarding the international aspects of a business decision, you may decide to set up a table with the risks and weigh their relative importance against the rate of return you foresee. You also need to put a plan in place to overcome it.
    Assume that your business is visible and an important member of the community. Would the government encourage a decision to expand? How would it affect the reputation of the business?
    Here is what the list looks like. Your assignment is to fill in the table.

    Risk Importer Exporter L/M/S How to Overcome It
    Economic conditions        
    Fluctuations in industry        
    Competition        
    Technological change        
    Change in preferences        
    Costs and expenses        
    Regulations        
    Expropriation        
    Interest rates        
    Government monetary policy        
    Government fiscal policy        
    Internal and external wars        
    Difference in culture and religion        
    Ownership of factories and property        
    Human resource restrictions        
    Intellectual property        
    Discrimination        
    Red tape and corruption        
    Blockage of funds or capital accounts        
    Change in government        

    Comment on whether the U.S. government would support a business owner’s decision to expand internationally or import in light of the balance of payments and how the move internationally may affect the business’s reputation as a local small-business owner.

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