Chapter 1: Impact of Globalization

Question 1

It is an interesting phenomenon since it is obvious that the world has been going through this process

Answer 1

GLOBALIZATION

Question 2

it is phenomenon that cannot be simply ignored

Answer 2

GLOBALIZATION

Question 3

Effect of globalization are classified into two broad categories

Answer 3

1. Global market opportunities
2. Global market threats

Question 4

It refers to the increases of market potential, trade, investment potential, and resource accesibility

Answer 4

Global market opportunities

Question 5

It refers to the increases in the number and level of competition, and the level of uncertainty?

Answer 5

Global market threats

Question 6

it enable firms to access worldwide resources and expand into many new overseas markets

Answer 6

Global market opportunities

Question 7

It can be destructive to firm performance due to an increasing number of competitors and an increase in intensity of competition coupled with higher market uncertainty.

Answer 7

Global market threats

Question 8

Threats and opportunities in the global marketplace

Answer 8

• Political,
• cultural differences and
• economic environment

Question 9

What are the basic principles to underpin greater prosperity

Answer 9

• investment
• spread of technology
• strong institutions
• sound macroeconomic policies
• an educated workforce
• existence of a market economy

Question 10

a term used to describe the changes of societies and the world economy that are the result of dramatically increase trade and cultural exchange.

Answer 10

Globalization

Question 11

It is probably no mere coincidence that over the past _____, as a number of countries have become more open to global economic forces, the percentage of the developing world living in extreme poverty— defined as living on less than ______ per day has been cut in half.

Answer 11

20 years; $1

Question 11

The __________________ notes there are still around 1 billion people surviving on less than $1 per day-with 2,6 billion living on less than $2 per day.

Answer 11

UN’s Human Development Report

Question 11

is a historical process, the result of human innovation and technological progress.

Answer 11

Economic “globalization”

Question 12

It refers to the increasing integration of economies around the world, particularly through the movement of goods, services, and capital across borders. The term sometimes also refers to the movement of people (labor) and knowledge (technology) across interational borders.

Answer 12

Economic “globalization”

Question 13

began to be used more commonly in the 1980s, reflecting technological advances that made it easier and quicker to complete international transactions both trade and financial flows.

Answer 13

Economic “globalization”

Question 13

also offer greater opportunity for people to tap into more diversified and larger markets around the word.

Answer 13

Global Markets

Question 13

_______ do not necessarily ensure that the benefits of increased efficiency are shared by all.

Answer 13

Global Markets

Question 13

The value of trade (goods and services) as a percentage of world GDP increased from ___________

Answer 13

42.1 percent in 1980 to 62.1 percent in 2007.

Question 14

Foreign direct investment increased from __________

Answer 14

6.5 percent of world GDP in 1980 to 31.8 percent in 2006.

Question 15

The number of foreign workers has increased from __________

Answer 15

78 million people (2.4 percent of the world population) in 1965 to 191 million people (3.0 percent of the world population) in 2005.

Question 15

be they in business or government- can draw on ideas that have been successfully implemented in one jurisdiction and tailor them to suit their own jurisdiction.

Answer 15

Innovators

Question 15

can also create a framework for cooperation among nations on a range of non-economic issues that bave cross-border implications, such as immigration, the environment, and legal issues.

Answer 15

Globalization

Question 15

implies that information and knowledge get dispersed and shared.

Answer 15

Globalization

Question 15

a Nobel laureate and frequent critic of globalization, has nonetheless observed that globalization “has reduced the sense of isolation felt in much of the developing world and has given many people in the developing world access to knowiedge well beyond the reach of even the wealthiest in any country a century ago.

Answer 15

Joseph Stiglitz

Question 16

A core element of globalization is the expansion of world trade through the elimination or reduction of trade barriers, such as import tariffs.

Answer 16

International Trade

Question 17

often a source of economic growth for developing nations, stimulate job creation as industries sell beyond their borders.

Answer 17

Exports

Question 18

enhances national competitiveness by driving workers to focus on those vocations where they, and their country, have a competitive advantage.

Answer 18

Trade

Question 19

promotes economic resilience and flexibility, as higher imports help to offset adverse domestic supply shocks.

Answer 19

Trade

Question 20

that is, engaging in protectionism generates adverse consequences for a country that undertakes such a policy.

Answer 20

Restricting International Trade

Question 21

tends to reward concentrated, well-organized and politically-connected groups, at the expense of those whose interests may be more diffuse (such as consumers). It also reduces the variety of goods available and generates inefficiency by reducing competition and encouraging resources to flow into protected sectors.

Answer 21

Protectionism

Question 22

the former president of Mexico, has observed that, "In every case where a poor nation has significantly overcome its poverty, this has been achieved while engaging in production for export markets and opening itself to the influx of foreign goods, investment, and technology."

Answer 22

Ernesto Zedillo

Question 23

At the same time, __________ have risen across virtually all regions for even the poorest segments of population, indicating that the poor are better off in an absolute sense during this phase of giobalization, atthough incomes for the relatively well-off have increased at a faster pace.

Answer 23

per capita incomes

Question 23

Equally important, globalization should not be rejected because its impact has left some people ________

Answer 23

UNEMPLOYED

Question 23

the Financial Times columnist, highlights one of the fundamental contradictions inherent in those who bemoan inequality, pointing out that this charge amounts to arguing "that it would be better for everybody to be equally poor than for some to become significantly better off, even if, in the long run, this will almost certaisly lead to advances for everybody.

Answer 23

Martin Wolf

Question 23

One of the most authoritative studies of the subject has been carried out by World Bank economists

Answer 23

David Dollar and Aart Kraay

Question 24

concluded that since 1980, globalization has contributed to a reduction in poverty as well as a reduction in global income inequality. Furthermore, they, found out that in "globalizing" countries in the developing world, income per person grew three-and-a-half times faster than in "non-globalizing" countries, during the 1990s.

Answer 24

David Dollar and Aart Kraay

Question 25

who denoted that "higher growth rates in globalizing developing countries have translated into higher incomes for the poor."

Answer 25

David Dollar and Aart Kraay

Question 26

pointed out that "the main losers in today's very unequal world are not those who are too much exposed to globalization. They are those who have been lef out.

Answer 26

Kofi Annan

Question 26

found out that on average 64 percent of those polled in 27 out of 34 countries- held the view that the benefits and burdens of "the, economic developments of the last few years" have not been shared fairly.

Answer 26

BBC World Services

Question 26

in some developing countries, those who perceive such unfaimess are more likely to say globalization is proceeding too ______

Answer 26

slowly

Question 26

Myths about globalization

Answer 26

1. Downward pressure on wages 2. The “race to the bottom” 3. Globalization is irreversible 4. Openness to globalization will, on its own, deliver economic growth 5. The shrinking state

Question 27

intensified and spread across asset classes and banks, precipiating a financial shock that many have charactesized as the most serious sine the 19

Answer 27

Credit Market Strains