TUTORIAL IB

Which of the following is not a point raised by protesters against globalization?

• Create higher consumer income and more jobs

• Lead to environmental damage

• No large gap between the poor and rich nation

• Falling wages and living standards

Answer explanation

Critics of globalization worry that jobs are being lost to low-wage nations. They argue that

falling trade barriers are allowing companies to move manufacturing jobs to countries where

wage rates are low.

A situation where countries can buy and sell goods/ services from neighboring countries without intervention from government

Answer explanation

Free trade - a situation where a government does not attempt to influence through quotas or duties what its citizens can buy from another country or what they can produce and sell to another country.

Global Production works by lowering cost and increase product quality

• TRUE

• FALSE

Answer explanation

The Globalization of Production refers to the sourcing of goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production like land, labor, and capital.

Process of increasing interconnectedness and interdependence among countries, economies,

culture and societies around the world refers to

Answer explanation

Globalization refers to the process of increasing interconnectedness and interdependence among countries, economies, cultures, and societies around the world. It involves the exchange of goods, services, ideas, information, technologies, and people across borders, facilitated by advancements in communication, transportation, and technology.

A country's capacity to produce multiple goods more efficiently and import goods that it produces less efficiently from other countries.

From the statement above, who introduced this theory?

• Adam Smith (1776)

• David Ricardo (1817)

• Eli Heckscher (1919) & Bertil Ohlin (1933)

• Wassily Leontief (1953)

Answer explanation

Ricardo’s suggest that “countries should specialize goods that most efficient and have lower opportunity cost”.

• Any country maybe in position for producing more than one commodity that others, but the countries should not produce all due to the commodities will be import.

Comparative advantages theory provides a strong rationale for encouraging free trade.

• TRUE

• FALSE

Answer explanation

Comparative advantages assumption:

i. Trade only involves two countries.

ii. There will be only two commodities involved.

iii. Free trade between the countries.

iv. The nation produces in fully employment.

Less ability to develop strong network within a firm is one of the advantages for Individualism.

• TRUE

• FALSE

Answer explanation

1. Advantages of Individualism

2. 1. Individual achievement is common

3. 2. Dynamism of the U.S. economy

4. 3. High level of entrepreneurship

Uncertainty avoidance refers to how comfortable a culture is with uncertainty and

Which of the following is not part of factor endowment according to Porter's Diamond theory?

• Climate

• Skilled labor

• Technology know-how

• Stratified society

Answer explanation

The factor endowment can be either basic such as natural resources, climate, location or advanced skilled labor, infrastructure, technological know-how.

Drink hot green tea in the morning is considered as _______ in Japan

Answer explanation

Culture also refers to the shared patterns of behaviors and interactions, cognitive constructs, and understanding that are learned through socialization.