IBUS

This question is about Sanyo Case, similar to the case covered in class. Based on data below please answer the following question: If San-pod is assembled in Greece, what is the unit Duty cost in shipping to Germany? Costs, demand, weight, and tariff data Annual demand for San-pod in Germany: 30,000 Annual demand for San-pod in USA: 10,000 Labor costs China ($): $3 per unit; Greece ($): $4.5 per unit; Mexico ($): $5 per unit Product weight per unit Assembled San-pod (g): 90 Part A from Malta (g): 50 Part B from Japan (g): 40 Product purchase price Part A FOB Malta ($ per unit): $10 Part B FOB Japan ($ per unit): $30 Tariff rates (%): Japan 6%; China 7%; Mexico 8%; USA 5%; Greece 7%; Germany 7% Combined rates for transportation and insurance between respective points (I&F $ per 100g) Malta to Greece: 0.6 Malta to China: 2.2 Malta to Mexico: 2.5 China to Germany: 2.3 China to USA: 2.75 Greece to Germany: 0.6 Greece to USA: 2.5 Mexico to Germany: 0.8 Japan to China: 0.8 Japan to Greece: 2.5 Mexico to USA: 0.4 Japan to Mexico: 2.3

$0

You (USA dealer) contributed $50,000 to start a car trading company on Jan 1, 2018. Let's suppose you (USA dealer) imported 10 Mercedes from a German dealer on Dec 1, 2018 at € 70,000 each, payable in 60 days. The exchange rate on Dec 1, 2018 was 1.14 US$/€. Then you sold all of them in the US market at US$87,000 (each BMW) in cash on Dec 29, 2018. The exchange rate on Dec 31, 2018 was 1.13 US$/ €. You (USA dealer) contributed additional $20,000 on Jan 1, 2019. On Jan 31, 2019, you paid to German car dealer at the exchange rate of 1.10 US$/€. You purchased a company car (not for sales) in cash ($25,000) on Dec 31, 2019. (No need to record depreciation.) What was the amount of Operating Activities (in US Dollar) in 2019 Cash Flow?

-770000

Town A, in one hour, can produce either 5 hotdog buns, or 10 sausages. Town B, in one hour, can produce either 10 hotdog buns, or 6 sausages. There are 60 people in each town. If Town A and Town B applies the theory of comparative advantage, or specialization of production, how many total hours (ADD hours required to produce hotdog buns AND hours required to produce sausages) does it take to produce hotdog buns for 120 people and sausages for 120 people?

24 hours

A project requires an initial investment (or you may say, 'cash outflow') of $225,000 and is expected to generate the following net cash inflows: Year 1: $120,000 Year 2: $125,000 What is Net Present Value (NPV) of the project if the minimum required rate of return (or, you may say firm's cost of capital) is 4%?

5954.14

According to the class, _____ is #1 agricultural export of California.

Almonds

RE: Boeing 45 years ago, when the early models of Boeing's venerable 737 and 747 jets were rolling off the company's Seattle area production lines, foreign suppliers accounted for amazing 58% of those parts on average. True or False?

False

Example of BMW in Germany and Netherlands demonstrated:

Tax system difference between Germany and Netherlands

RE: Supply Chain Management in textbook Quality control, proprietary technology, having control, excess capacity, limited suppliers, assurance of continual supply, and industry drivers all affect make -or-buy decisions. True or False?

True

RE: Uber In New York, the number of licenses barely increased from 1945 to 2014. This restriction was one of the drives for Uber, and Uber-like business. True or False?

True

_______ are levied as a proportion of the value of the imported good.

ad valorem tariffs

RE: Supply Chain Management in textbook We learned about local content requirement previously. This requires companies like Toyota to __________.

buy components from north American suppliers in the US manufacturing operations.

Let's suppose you (USA dealer) imported 10 BMW (7 series) from a German dealer on March 1, 2018 at € 63,000 each, payable in 30 days. The exchange rate on March 1, 2018 was 1.16 US$/€. Then you sold all of them in the US market at US$75,000 (each MBW) in cash on March 29, 2018. On April 1, 2018, you paid in full to German car dealer at the exchange rate of 1.20 US$/€. For this scenario, what would be the Gross Profit (not Net Income) in 2018?

c 19200

RE: Is Chinese Exporting the Next Edge for the Country? So called 'China price' means:

c vastly lower price

You are US company, 500,000 BP (British Pound) payable to UK in one year. Answer in terms of US$. Information for Forward Contract: Forward exchange rate (one yr): 1.54 $/BP Information for Money Market Instruments (MMI): Current exchange rate: 1.50 $/BP Investment return at Aerion Fund Management (in UK): 4% annual Interest rate of borrowing from Bank of America (in USA): 2% annual Information you need for Currency Options Contract: Options premium: 0.015 $/BP Interest rate of borrowing from Bank of America (USA): 2% annual Allowed to exercise options at 1.54 $/BP What are the costs of MMI? (Answer in US$ of course. You are US company!) a$789,343 b $735,504 c$783,452 dNone of the above e$770,082

d none of the above

You want to analzy if you should invest in Ken's Japanese Rice Ball (called Onigiri) stand or David's Hotdog stand. According to information below, who should you invest in? Ken's Japanese Rice Ball Stand Investment requested: $1000 Ken will give you 17% of earning Expected Earning: $6000 David's Hotdog Stand Investment requested: $700 David will give you 10% of earning Expected Earning: $7500

david

RE: Does the current account deficit matter? (Textbook) If China and Japan would sell the US$ they earned through export and invest or buy other non-US$ currencies, such as Euro, then it can _____________, though it is unrealistic scenario.

decrease value of US$ in the foreign exchange market

"On 1 December 2011, the Tobacco Plain Packaging Act 2011 (the Act) received Royal Assent and became law in Australia. The Act forms part of a comprehensive range of tobacco control measures to reduce the rate of smoking in Australia and is an investment in the long term health of Australians. Smoking is one of the leading causes of preventable death and disease in Australia." In FTA agreement between US and Australia, Investor-State-Dispute-Settlement (ISDS) is included which allowed Philip Morris USA to sue Australian government for enacting the Tobacco Plain Packaging Act. True or False?

false

According to the class, all ten members of ASEAN are united in their efforts to achieve the 'common market' economic integration level by 2025. True or False?

false

If top management of organization outsources more, wiping more assets off the balance sheet, the company's RONA would likely go down. True or False?

false

RE: "Remanufactured auto parts market in Japan: Historical review and factors affecting green purchasing behavior" by Matsumoto, Chinen, and Endo in Journal of Clear Production: In 2000s, car repair shops played an important role in changing the RAPS market. However, remanufacturers have not contributed to the growth of the RAPs market. Their marketing and sales promotions of RAPs that targeted car repair shops have not increased the shops' knowledge of RAPs, unfortunately. True or False?

false

RE: "Remanufactured auto parts market in Japan: Historical review and factors affecting green purchasing behavior" by Matsumoto, Chinen, and Endo in Journal of Clear Production: In the mid-1980s, the Japanese currency's exchange rate rose, almost doubling against the US dollar. This increased the price competitiveness of Japanese alternator/starter remanufacturers in the global market. True or False?

false

RE: 1980-1993: Protectionist Trends (textbook) During the 1980s and early 1990s, the trading system erected by the GATT came under strain as pressures for greater protectionism increased around the world. One of the reasons for the rise in such pressures during the 1980s was the success of China during that time. True or False?

false

RE: British exit from the EU In the referendum, London, Scotland, and Northern Island voted for exiting EU, whereas most of the rest of the country voted to stay in the EU. True or False?

false

RE: Supply Chain Management in textbook Many global companies think that cost and production capacity are the only factors playing into the make-or-buy decision. The authors of the textbook agree with this statement. True or False?

false

RE: U.S. Magnesium In 2004, U.S. Magnesium, the only surviving US producer of magnesium, filed a petition with the U.S. International Trade Commission (ITC) contending that a surge in imports [of foreign magnesium] had caused material damage to the U.S. industry's employment, sales, market share, and profitability. In 2005, ITC ruled that both China and Russia had been dumping magnesium in the United States. The case concluded that this ruling by ITC made US magnesium consumers ultimate winner. True or False?

false

The infant industry argument (Political Economy of International Trade) suggests that an industry should be protected until it can develop and be viable and competitive internationally. However, this argument has been criticized because

if a country has the potential to develop a viable competitive position, its firms should be capable of raising necessary funds

"Domestic rice production is also tied to fears that Japan, which relies on food imports to feed its burgeoning population, could be held hostage by foreign rice growers if it became dependent on imported rice. While that might be acceptable for other food products, to allow it to happen to rice would be perceived as a crisis." This paragraph describes Japanese consumers' concern about:

national security

You are UK company, 200,000 US$ payable to US in one year. Answer in terms of BP (British Pound). Round at four decimal places Examples: 1.23487 ---> 1.2349; 1.23533 --> 1.2353 Information for Forward Contract: Forward exchange rate (one yr): 0.7124 BP/$ Information for Money Market Instruments (MMI): Current exchange rate: 0.7173 BP/$ Investment return at JP Morgan (in US): 5% annual Interest rate of borrowing from HSBC (UK): 3% annual Information you need for Currency Options Contract: Exercise options premium at 0.09 BP/$ Interest rate of borrowing from HSBC (UK): 3% annual Allowed to exercise options at 0.7215 BP/$ Let's assume you signed the COC contract in this scenario. If the actual exchange rate at the time of payment is .7114 BP/$, should you exercise the option?

no

You are UK company, 200,000 US$ payable to US in one year. Answer in terms of BP (British Pound). Round at four decimal places Examples: 1.23487 ---> 1.2349; 1.23533 --> 1.2353 Information for Forward Contract: Forward exchange rate (one yr): 0.7124 BP/$ Information for Money Market Instruments (MMI): Current exchange rate: 0.7173 BP/$ Investment return at JP Morgan (in US): 5% annual Interest rate of borrowing from HSBC (UK): 3% annual Information you need for Currency Options Contract: Exercise options premium at 0.09 BP/$ Interest rate of borrowing from HSBC (UK): 3% annual Allowed to exercise options at 0.7215 BP/$ Under the COC, the break-even exchange rate is .6109 BP/$. If the management team speculates the exchange rate at the time of the payment would be .6223 BP/$, would they sign the COC contract in this case?

no

RE: Supply Chain Management in textbook JIT inventory systems is to economize on inventory holding costs by having materials arrive at a manufacturing plant just in time to enter the production process and not before. This _______ the amount of of working capital it needs to finance inventory.

reduces

Philips in China suggests that it might be better strategy if the manufacturing facilities of companies were more geographically diverse as a hedge against problems in China. True or False?

true

RE: Are the Chinese illegally subsidizing auto exports? During the presidential election campaign in 2012, the Obama administration filed a complaint against China with the WTO for China providing export subsidies to its auto and auto parts industries. However, the response from U.S. auto companies and auto parts producers was muted. For one thing, some U.S. producers benefit by purchasing cheap Chinese auto parts. True or False?

true

RE: Burberry Angela Ahrendts, CEO of Burberry's in 2007 decided to started terminating license agreement with Sanyo Shokai because she felt that it was crucial for Burberry to control its luxury, high-end brand image. True or False?

true

RE: FDI in China Some of the reasons for inward FDI increase in China are relatively inexpensive labor costs and tax incentives. True or False?

true

RE: Hidden Costs of Foreign Locations (Textbook) According to a manger of an electronics company that outsourced the manufacture of wireless headsets to China, productivity and workmanship (at least for his company) are issues in doing business in China. True or False?

true

RE: Is China Dumping Its Excess Steel Production? From early 2000 to 2015, China increased its steel production 5 times as it forged the steel products demanded by its huge boom in construction and infrastructure spending. However, due to the economy slow down, China produced more steel than required for domestic consumption. They sought to export unwanted steel. This also persuaded steel producers in India, Italy, South Korea, and Taiwan to dump their excess production on the world market. True or False?

true

RE: Regional Economic Integration Threats (textbook) In a way, price differentials in the same economic integration would decline in a single market, especially if they use the same currency. True or False?

true

RE: Supply Chain Management in textbook The make-or-buy decision is the starting point for operations' influence on global supply chains. True or False?

true

RE: TPP Trump felt TPP was a terrible deal. So did Bernie Sanders. True or False?

true

RE: Two Men and a Truck Two Men and a Truck is the fasted growing franchised moving company in the US. True or False?

true