|
Blog
Guest book
| |
1. Please discuss the significance of non-tariff barriers as an
obstacle to international trade, giving an example.
Non-tariff barriers involve efforts by governments
to keep foreign goods out by means other than putting a tariff or duty on things
that are imported. Some methods:
 | Quotas. Here, a given country can export
only a limited amount to another country—e.g., each country in the Caribbean
can only export a limited number of textiles to the United States.
|
| Cumbersome regulations. A country may make
it difficult for a foreign firm to get its products approved. For
example, U.S. firms are often not given clear information about how their
products are going to be tested in Japan. |
| Logistical obstacles. Here, the importation
process is made difficult. For example, in France, foreign VCRs could
once enter only through one port that had a long backlog in processing
shipments. |
2. Please discuss at least two practices or situations that are banned
by antitrust laws of the United States.
| Collusion: Firms are not allowed to get
together to limit competition by lowering service or “fixing” prices—i.e.,
agreeing not to sell below a certain price. |
| Predation: Firms are not allowed to sell
below their cost of production or otherwise try to drive another firm out of
business. |
| Tying: A firm may not require a consumer to
buy a less desirable product in order to be allowed to buy a scarce one—e.g.,
Intel may not require computer manufacturers to buy its motherboards, which
are made by a number of manufacturers and are readily available, as a
condition for being allowed to buy the latest Pentium IV chips which are in
short supply. |
| Excessive market share. A firm is not
allowed to dominate a market as evidenced by having an overly large share of
that market—e.g., AT&T was broken up because the firm had a near monopoly on
U.S. long distance phone service. |
3. Why is it useful for firms to have plans at both the corporate and
business unit levels?
A firm needs to allocate resources across its
different business units. Some business units may be more promising than
others, and some may be able to provide resources that are needed others (e.g.,
“cash cows” can provide cash needed for “stars” or “question marks” to grow).
Strategic planning may also be needed at the
business level unit for two reasons. First, managers at the business unit
level know the specific business better, and may therefore be better able to
make specific plans for what their units should do. Secondly, business
unit plans help hold managers at that level accountable.
|
