跨国公司财务管理基础 (1).pdf

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1、TEXASTECHUNIVERSITYSECONDSUMMER2012RAWLSCOLLEGEOFBUSINESSAREAOFFINANCEFIN4328–001–62167–InternationalFinanceDr.DanışoğluHomework#1DueonThursday,July19,20121.PleaseanswerQuestions1and3fromtheendofAppendix1A:TheOriginsandConsequencesofInternationalTradeonpages27thr

2、ough30ofyourbook.PleasedonotanswerQuestion2.1.a.IstherealogicalflawinBastiat'ssatiricalargument?ANSWER.No.Bastiatispreciselyright.Theobjectiveoftradeistogainaccesstogoodsandservicesatlowerquality-adjustedprices.Theultimateconsequenceistomakemoreefficientuseofthew

3、orld'sresourcesandtherebyincreaseworldwideproductionandconsumption.Protectionismaimstopreventthisend.Ifprotectionismsucceeds,worldoutputandconsumptionarelowerthantheymightotherwisebebecauseresourcesarenotbeingputtotheirhighestvalueduse.IntheexamplecitedbyBastiat,

4、protectionismwillleadtoasquanderingofresourcesbyreplicatingwhatthesuncandolessexpensively.1.b.DoJapaneseautomakerspreferatarifforaquotaontheirU.S.autoexports?Why?IstherelikelytobeconsensusamongtheJapanesecarmakersonthispoint?MighttherebeanyJapaneseautomakersthata

5、relikelytopreferU.S.traderestrictions?Why?Whoarethey?ANSWER.Itdepends.Tounderstandwhy,ithelpstorecognizetheconsequencesofthesealternativetradebarriers.BothtariffsandquotaswillleadtohigherpricestoU.S.consumersofimportedJapanesecars.Withtariffs,however,mostofthispr

6、iceincreasewillgototheU.S.governmentintheformoftariffs.Japanesecompanies(ortheirdealers),ontheotherhand,willcollectmost,ifnotall,ofthehigherpricesassociatedwiththescarcityofimportedJapanesecars.OncetheJapaneseproducershittheirquotalimit,theyhavenoincentivetocompe

7、tewitheachotherbycuttingpricebecausetheycannotsellmorecarsthantheyalreadyare.ThenetresultisthattheU.S.marketwillbeextraordinarilyprofitabletoJapaneseautomakers,whichitwas.Sincequotastendtobeallocatedbasedoncurrentsales,thoseautomakerslikeToyotaandNissanwithlargem

8、arketshareswouldpreferquotas,whereasthoseautomakerslikeHondaandMitsubishiwithsmallermarketshareswouldprefertariffs.Thereasonforthelatter'spreferencefortariffsi