1: Tariffs encourage Americans to buy U.S.-made products. (Points: 13) I find this position to be valid. Tariffs are basically taxes on imports, thus making imported goods more expensive to buy (Nickels, McHugh & McHugh, 2008, p. 75). Protective tariffs are designed to raise the retail price of imported products so that domestic goods are more competitively priced (Nickels, McHugh & McHugh, 2008, p. 76). Therefore, if when a consumer enters a store and sees similarly priced products, one imported and one made domestically, they can choose a US made product without feeling as if they are overpaying for the same product.
As stated in extract 1, it tells us that the goods we import are not made in the UK and so makes it impossible to replace the imports, therefore meaning that we still have to import goods, despite the high prices due to the low exchange rate of sterling. This is partnered with the fact that some suppliers (shown in extract 1) have agreed long term supply contract with cheaper overseas suppliers before the depreciation of the sterling and so they are now paying high prices. This may mean that these suppliers may have to increase the prices of these goods, therefore leading to cost push inflation due to trying to maintain a decent profit margin in the hope the demand for the good does not drop dramatically. However, it is stated that there still may be a large price differential with countries such as China and India, even after sterling's depreciation. On the other hand however, as stated in extract 1, line 8, volume of good imported has also increased by 16% and inflation has continued well above target.
Based on the provided documents, the social and economic effect of the global flow of silver from the mid-sixteenth to the early eighteenth century is because of finance management, currency exchange, and the high demand. Three additional documents which could help further answer the question would be a letter from the emperor of China, a frugal Chinese man, and the leader of Portugal. One way the economic effect of the global flow of silver from the mid-sixteenth to the early eighteenth century was due to finance management. In an order issued to limit wedding expenses, by country official Ye Chunji, explains that frugal men are able to spend while having silver leftover. The silver being spent had to be managed by everyone, no matter how large or small the amount of silver is.
The trade agreement improves the flow of trade across goods and services and to provide a firm foundation for the future economic relationship between Australia and China. The Free Trade graph shows that the equilibrium of Qe,Pe exists in closed economy not engaging in trade. When the free trade agreement is implemented the country imports goods from another country that are of a lower domestic cost compared to themselves enabling the price of that good to be lowered shown by P1. Supply is therefore reduced by the importing country as the price of the good has been lowered. Point B on the graph shows the demand increase as the new imported good lowers the price and therefore the quantity demanded
Demand for such vehicles can not be designed based on the jeep AMC existing, and the vehicle as desired from the Beijing Automotive Works (BAW) cost at least a $700 million. BJC and the AMC do not have the amount of money like that, and then try to convince the AMC Chinese to produce the new vehicle type Jeep Cherokee. It appeared that after convinced, the Chinese partners agreed then changed objectivity AMC began selling the cars to get money and selling the kits to get money. Appears a new problem where BJC can get foreign exchange for these kits. According to the rules when a number of foreign exchange in large numbers required a special license meanwhile BJC had never discuss about this to the Chinese government.
If local prices in a country increase more than prices in another country for the same product; being is that foreign exchange forward markets are linked to interest markets; then the local currency may decline in value via its foreign counterpart, presuming there is no change with the structural relationship between the two. Balance of payments are affected when the balance of payments approach suggest that the exchange rates have come from capital transactions and trade. When the internal and external pressures are in equilibrium, this usually means the exchange rate for the equilibrium has been
Thus, companies can and do successfully use self-expressive and individualistic marketing messages even within China. Thus, when promoting products in a collectivist country such as China, marketers will often have to position the product as a path to acceptance in an in-group. b) Explain other factors that might be driving the desire for luxury in China. As China’s prevalence in the global economy grows, the average earnings of Chinese workers are also increasing. Chinese workers have seen double-digit growth in their earnings in recent years.
PPP indicates that the same product should have the same price (law of one price). Therefore, Chinese yuan is undervalued (respect to the dollar). The exchange rate should be higher @ $0.256 per yuan ($3.71/14.5Yuan = $0.256) The yuan was undervalued with respect to the dollar by 41.37%: ($0.15/$0.256)-1 =41.37%. Q6) Answer:4 Q7) Answer:4 Q8) Answer:2 Q9) Answer:1 Q10) Discuss why it is often asserted that exporters suffer when their home currencies appreciate in real term against foreign currencies and prosper when their home currencies depreciate in real terms. Appreciation in domestic currency for exporters implies that their currency is too strong relative to a foreign currency; hence this will make their exports too expensive.
Rather than reducing social and economic inequality, China’s rapid economic growth magnifies the gap of benefits received by people in different socio-economic groups. As we will see, social and economic inequality are two sides of the same coin and is not solely the product of economic development. In addition to pure market forces, state policies play a significant role in contributing to the high levels of inequality China experiences nowadays. Despite the government’s concern towards inequality, recent interventions are not sufficiently targeted at the main causes of this issue which result in the continuing climb of China’s inequality figure. Nevertheless, contrary to conventional wisdom, the threat of inequality to China’s social and
Argument against trade protection Argument against trade protection, in another word calls it as argument for trade restriction which support for the free trade. Free trade occur when government do not attempt to restrict what its citizen can buy from another country or what they can sell to another country. With the free trade, each nation can specialization in production which they have comparative advantage than other country, and trade with other country exchange the production which they cannot produces in home nation or other country have comparative advantages in those production than us. Over the long run, each nation can more efficiency in production which spending lower prices to produce higher levels of output; Get more income, revenue and profit as increase the market place, and increase in the consumption or demand (consumer can buy their like or product at the lower price). A country can be a capital (or labor)-abundant nations and labor (or capital)-scarce nations which consider their comparative advantage in technologies, input productivity, and wages of labor.