International Business Finance and Economics of Globalisation
Assessment 2: Written Assignment
Semester 1, 2021 Dr. D Chakrabarty
Maximum Marks: 35 (worth 35% of the overall assessment)
Due date: Sunday, 9th May 2021, 23:59 hours, Darwin time
1. Assignment must be typed and submitted in Microsoft Word format.
2. Format the assignment with 1.5 line spacing and size 12 point Arial font.
3. Submit the completed assignment (as a Word document) electronically via “Assessment 2: Written Assignment Submission Point” in the Assessment 2 folder.
4. You must clearly label the answer to each question.
6. Word count: XXXXXXXXXXwords (total)
The suggested word limit for each question is provided in the assignment.
7. You should be familiar with materials covered until week 7 to answer this assignment. You may also use library resources and other online articles to support your answers.
8. You must clearly acknowledge all sources using Harvard referencing system including the textbook.
9. Keep a copy of your submitted assignment, in case there are problems with the electronic submission.
As this is an individual assessment, students should submit their own assignment. All assignments submitted will go through a matching process. If found to have cheated/plagiarised, all submissions will receive a mark of zero for this assessment item. It is up to you to keep your assessment confidential.
This Assignment consists of 3 questions. Attempt all of them.
Question 1 (10 marks, 600 words)
(a) Are there any links between lower labour and environmental standards in developing countries and their increased shares in world trade and investment? Discuss with evidence.
(4 marks, 200 words)
(b) Do you support the idea of imposing restrictions on the imports of goods that have been manufactured using child labor and in countries with lower environmental standards? Why? Why not? Discuss.
(3 marks, 200 words)
(c) What are the best ways to address lower labor and environmental standards in developing countries? Discuss.
(3 marks, 200 words)
Question 2 (10 marks, 600 words)
Suppose you work for an US Software company. You have been asked to write a report on possible countries that might be suitable for outsourcing software development. To help you write your report, your team has collected data on labour productivity and average salary of software developers for ten candidate countries.[footnoteRef:1] The data is summarized in the table below. [1: All numbers provided in this question are hypothetical. Data for U.S.A. is provided for comparison. ]
Average Annual Salary
(in US dollars)
The average salary of software developers in all countries have been converted into US dollars. Labour productivity is measured on a scale of 0-100 with 0 being the worst and 100 being the highest.
(a) Assuming labour costs and labour productivity are equally important in the profitability of a software development company, write a brief report highlighting the strengths and weaknesses of the ten candidate countries for outsourcing. Your report should include your top three and bottom three picks as a destination for outsourcing software development of your company.
(10 marks, 600 words)
Question 3 (15 marks, 800 words)
Recently, there have been instances of large open economies imposing significant tariffs on imports from their trading partners. Details of the two such cases are provided below.
1. Starting from a most favoured nation (MFN) average tariff rate of 3.1% in 2017, the US increased its tariff on Chinese exports to 21% by January 2020. This was carried out by a series of tariff hikes under Section 301 from the beginning of 2018.
2. In May 2020, the Commerce Ministry of China ruled that Australia had indulged in dumping and subsidisation of barley exports to China and imposed a combined 80.5% tariff on Australian
barley (73.6% anti-dumping duty and 6.9% countervailing duty).
(a) Based on the theories we have studied, discuss the possible explicit and implicit reasons that may explain the decisions by the US and Chinese governments to implement such a sharp increase in their tariff rates.
(8 marks, 400 words)
(b) What are the likely impacts of the higher tariffs on the different sections of the economy in the importing and the exporting country? Provide a brief explanation for each case.
(7 marks, 400 words)
END OF WRITTEN ASSIGNMENT
FIN207, S1 2021
FIN207, S1 2021