Security analysis and portfolio management

Assignment no: 01

Submitted to:
Mam Hina kanawal
Submitted by:
Eisha maham
Roll no:
18Arid-832
BBA 6th
Section:
A
Gujarat Institute of Management Sciences PMAS- Arid agriculture
University Rawalpindi

Question no: 01
1|Page
Differentiate between Domestic and International Business. Also highlights
the significance of International Business?

Differentiate between Domestic and International Business

BASIS FOR DOMESTIC BUSINESS INTERNATIONAL

COMPARISON BUSINESS

Meaning A business is said to be domestic, International business is one which is

when its economic transactions are engaged in economic transaction with
conducted within the geographical several countries in the world.
boundaries of the country.

Definition The trade which takes place within Whereas trade which occurs between
the geographical boundaries of the two countries internationally, is called
country is called domestic international business.
business.

Quality standards Quite low Very high

Deals in Single currency Multiple currencies

Capital investment Less Huge

Restrictions Few Many

Nature of Homogeneous Heterogeneous

customers

Business research It can be conducted easily. It is difficult to conduct research.

Mobility of factors Free Restricted

of production

Area of operation Within the country Whole world

Significance of International Business

Significance of International Business

2|Page
 1. Market expansion

2. brings foreign exchange

3. spreading of business risks

4. Economics of scale

5. Cost advantages

6. Improve international business

7. Provide employee opportunity

8. Government support

Question no: 02

Do you think that business practices in an Islamic country are likely to differ
from business practices in the United States? If so, how?
Yes, I agree with this statement that business practices in Islamic country are differing from
business practices in the United States.

1. Language is the first and foremost aspects of international business. As every country has
its own language.
2. Laws are based on the Muslim Holy Book, the Quran.  The system is often known as
“Sharia” but their business rules and regulation are not so strict.
In United states their laws are very strict for export their product in other
countries for this strict rules and regulation it decreased other countries to import
product from them. It make difficult to business practices between Islamic
country and United States.
3. Business practices are also different by population, income rate, income growth rate,
heritage; so many things are related with business.
4. The weather pattern is also an important aspect of international business.
For example, the clothing pattern of cold country and the high-temperature
country will not be same as well as the cosmetic pattern of the cold and hot
weather country will not be seen that most of the Islamic country weather is not
hot. So when U.S goes for their business practice those countries must watch the
weather.

3|Page
 5. Difference in prays that makes critical business practice between Islamic countries and
United stated.
For example, Islamic countries peoples are play five time in a day, they doing
fast our whole month of Ramadan and the following Friday as holiday. But in
USA countries celebrate Christmas day and the following Sunday as holiday.
6. Product acceptability is also a major point for business practices in different country.
Like, hard drink and poke type of products are not allowed in Muslim country,
but those types of products are available and allowed in United States. So it also
being a difference between Islamic country and United State business practice

Question no: 03

A democratic political system is an essential condition for sustained economic

progress. Discuss?
A democratic political system is an essential condition for sustained economic progress
because it allows citizens to have a say in what goes on within the country. There are nine
safeguards, including freedom of expression and organization, a free media, and limited
terms for elected representatives, just to name a few. These allow citizens to stay
informed and elect new leaders when one’s term is up. In doing so, newly elected
officials must work for the people to create jobs and benefit society or else they will not
be reelected. In socialist countries, citizens do not have a choice over who governs them,
so the leaders do not feel any pressure. By giving citizens a voice and pressuring leaders
to act in their best interests, there is a better chance for long-term economic growth.

Question no: 04

What is the relationship among property rights, corruption, and economic

progress? How important are anticorruption efforts in the effort to improve a
country’s level of economic development?

Relationship among property rights, corruption, and economic progress:

1) Protection of Property Rights is fundamental for economic development. It guarantees
that any entrepreneur or innovator who invested his funds or his skills will be justly
rewarded for the same. The fruits of his labor will not be stolen used by others. Without
this protection, the incentive to invest does not exist.
2) Corruption can play a very big role in halting the progress of economic development.
Even if there is the IPR protection with corruption, one can never be sure whether the
protection would be available when it is required. Also corruption plays a major role in
dissuading new investors into any country. This corruption starts from the beginning of
making an application to getting the permission for starting a business. It may also

4|Page
 continue with every additional regulation that one has to get an approval for. This is the
taking of bribes.
3) In addition, there can be a much higher level of corruption where high-ranking politicians
siphon off funds from the state treasury for personal gain.
4) Simply Property rights are the legal rights over the use to which a resource is put and
over the use made of any income that may be derived from the resource. They way they
relate with corruption come in two forms: Private and Public action. Private action comes
in the form of piracy and public action comes in the form of legally; excessive taxation or
illegally; bribery. When these corruptions occur, it reduces foreign direct investment, the
level of international trade, and the economic growth rate in a country. That's how
economic progress relates.
How important are anticorruption efforts in the effort to improve a country’s
level of economic development?
 Corruption in a country, specifically in a country’s government leadership, can halt
economic progress. Often times, in developing economies, corruption comes in the form
of the powerful elite taking advantage of their position to benefit themselves at the
expense of the economic progress of the people. Anticorruption efforts protect against
this stunting growth.

Question no: 05

5|Page