UNIVERSITY OF TURBAT

Department of Management Sciences

Session Marks Assessment Assignment Fall 2020

BBA 6th SEMESTER

Name: Sadiq Ali Date: 30/11/2020
Course: International Business Date of Submission: 11/01/2021
Course Instructor: Mr. Malik Dad Total Marks: 15
Instruction: Attempt the assignment after reading the provided materials. You’re required to
solve the assignment Typed in Microsoft Word. Your own thoughts and efforts while solving the
assignment will be needed.
General Instructions for Completing and Submitting your Assignment:
 All assignments that students will submit as part of this course and are subject to the
examination.
 You should identify yourself clearly in every file you submit. Your identification
information should include:
i. Your Full Name
ii. Semester with Session,
and this information should appear on the cover page of each assignment.
 Assignments must be done INDIVIDUALLY; and you must not copy any student’s
assignment or any part thereof. Further, you must not allow another student to copy your
assignment or any part thereof. You are free of course to discuss ideas with each other on
how to approach a problem, but you should be very careful not to write assignment
together. Copied assignments (both or all) will be marked zero.
 Before starting the assignment writing process, ensure that you clearly understand the
assignment questions. The contents of your assignment must illustrate your knowledge
and understanding of the topics that you cover in the answers. Read the given materials
carefully. You are also advised to plan the contents of your assignment in advance.
 When drafting your assignment, please always keep in mind that the assignment is set on
the level of higher education. Therefore, you should not only demonstrate an adequate
understanding of theory, but also should show insight into the application of the
knowledge.

Assignments should be submitted in Microsoft word file at Management Sciences Department,

UoT, on or before 10/01/2021
OR it can also be emailed to the following email address: rind2775@gmail.com

Note: similarity will be discouraged and lead to zero marks.

Q1: What factors have contributed to the growth of globalization in recent decades?
1: Rise in application of technology.
Quick yet non-stop practical exchange is decreased the cost then cost over the conduction
Telecommunication then we perform says finishing the distance. It additionally stand a authorization
element according to using the inward then web technology. If we see the informational technological
know-how as is accomplishing in all places of the global e.g World Wide Web who reducing the barriers
concerning day then region into the enterprise dealings. Sellers or consumers can met in epoch or do
somebodytransactions of some and two minutes anybody portion over the world. Increasing concerning
technological know-how facilitated the globalization technology constrain the corporation or
corporations in conformity with stay global through increasing the range of the economies or need
greatness pleasure stand large. E.g payment thru online.

2: Liberalization of cross-border trade and resource movements.

Liberalization over cross-border trade yet useful resource movement who quote the restriction yet
decreases the obstacles who are accept by means of the state according to enable globalization process.
There will stay profession on accessories or capabilities or ignoble resources. International enterprise
makes unrestricted vocation assets throughout the resemble and such also will increase the
globalization due after the absolute reasons. Globalization growth because they liberalized theirs
economic system in accordance with compete the global market. Due in conformity with putting off the
vocation limitations wish increases the overseas funding yet improve the performances in imitation
of the producers. E.g 1. Competition is extra appropriate after the competition domestic producer’s
intention come to be more efficient. 2 each and every United States resident’s necessity a higher
range of accessories then purposes at lower prices.

3: Services that support IB.

There are many functions who supports international business yet thriving about to that
amountapplications e.g.Banks, transportations, telecommunications, insurances andsordid corporations
whohelps you according to reduce the chances on doing IB. And it entire capabilitiesas are provided with
the aid of govt and it is a mangy factors which increases globalization by aiding IB or reducing the
obstacleswho enforces after doing Business internationally.

4: Growth in consumer pressures.

Is for the improvements on verbal exchange into each and every grasp concerning the global
commercial enterprise as customers nicely regarded in relation to whole the foreign merchandise as
relinquish extra benefits after the buyers in much less price. Growth among purchaser pressures need
higher characteristic and lower prices presented by way of reasons to them. Demand regarding patron
afford after buy beside others nations and nicely increase the globalization appropriate in accordance
with the properly records yet customers pressures.

5: Increase in Global Competition.

Which government according to multiplied globalization with the aid of forcing their rivals after
lie able after buy then sell throughout the border? Increasing world competition is a altering the
surroundings concerning home want where trade boundaries fall and traffic price trend andPartialcomp
anies yet businesses are pushed to increases the overall performance by way
ofinnovatingthenadopting unremitting system then manufacture improvement. Product innovation,
technology boom etc. All wish will increase appropriate in conformity
with internationaloppositionwho more increase the
globalization through its strategies who createsustainablecompetitive blessings becausebusinessesoradd
itionally necessary leader on assignment introduction.

6: Changes in political situation and government policies:

It boom the globalization who situations or policies guidelines yet regulations are better who intention
now not have an effect on the enterprise in the incorrect side. There are deep extraordinary
politic systems who is based of politics and govt additionally such governs a whole
employ over rules, act salvo among these rules yet decree then we says exclusive felony
structures condition all legal guidelines are evident because of the companies for both international
locations then the aggregate concerning entire components wish will increase the globalization
e.g. technology statistics productivity increase political policies more jobs creations etc.

7: Expansion of Cross-National Cooperation.

It ability as a United States of America or govt do cross national assistance because theirs very
ownpastimes even desire stayhalf agreements which we execute says a treaties agreements and
consultation. Mostly nations function ate go country wide collaboration because
of their negotiationsmoreover they action together in accordance with solves the problems or in
imitation
of createscurrentareas where it do improves theirs enterprise who are state outside the locality on both 
nation. There areincomplete policies as have an effect on mean countries it may
also lie thehigher activity quantityandlowerinterest dimension yet libber dosage is high or she swap in
accordance with any otheroverseaswantand country.

Q2: What are the criticisms of globalization?

There are three reasons which focus on criticism of globalization.

1: Threats to National Sovereignty:

Of the various criticisms about globalization, the distinguished critique
relates after the reality thatglobalization
erodes country huge sovereignty or takes outside the energy over governments.
Bypermittingglobal businesses then multinational companies according to embark the monetary (and
regularly, the political agenda), critics expostulate up to
expectation the government countryturnsamonginappropriate. The element to be referred in
accordance with is agreementworldwide groupsperformput in the age table. Just that capitalism runs at
the profits rationale tothe ban on thecompletefascicle more and therefore, companies besides a hesitati
on can't keep allowed in imitation
of set the terms concerning the political or pecuniary advice fit after the fact the u.
s. realm isfavorableafter entire citizens then no longer really after the prosperous or privileged.

2: Environmental Stress:
It is indispensable so costs don’t usually estimate because every about the expenses yet advantages
because of whole concerning the people touched by way of a transaction. Externalities execute are on
hand of good types or terrible. But the most frequently referred to externalities are the ones related
together with harms in imitation of the environment. Globalization has an effect concerning the
surroundings, on the other hand it is miles a mixed one yet commonly incomplete strip less frightening
than much human beings assume. Maximum ecological troubles are still nearby among desire in
imitation of worldwide, or whilst pass-border integration ought to make the surroundings dirtier within
some locations, it is in a position in conformity with additionally help together with cleansing such up

3: Growing Income Inequality And Personal Stress:

While accepting that truth, it is in addition the suit so much globalization has manufactured profits
variety as now coupled together with inflation or error living necessities has resulted
in a classification over people who're dropping outdoors greater than accomplishment beyond the appr
oach of globalization. It will become explicit so globalization consequences between worsening
income gaps then the switch regarding appearance from the backside according to the top. On
an alone degree, globalization has affected the typical concerning lifestyles yet satisfactory
concerning existence over humans yet households within the path regarding the arena. Globalization
has had a poor impact of folks any continue to be into advanced countries.

Q3: Why companies engage in IB?

1. Sales Expansion

The Mission of Global sales Expansion is to assist life science companies manage and grow their sales in
a profitable, timely, flexible and cost effective way by leveraging more international opportunities.
Because, companies are dependent on consumers’ interest in product and willingness to buy them.
Moreover, considering the fact that the developing countries are people with consumers who have
aspirations to (western) lifestyles. So that consumers’ should buy them. That is the reason.

2. Resource Acquisition.

This is one of the most important reasons for companies to expand internationally. Because the
developing and emerging countries have large deposits of minerals, metals and land for agricultural
production, the western multinationals eye these markets in order to get access to the resources. This is
the reason why many international businesses operate in Africa and South Asia where the humungous
deposits of minerals and metals are attractive for the profits that these multinationals can make. Many
emerging markets and developing countries do not have the expertise or the resources needed to tap
their reserves of these minerals and metals. Hence, they welcome the multinationals with open arms as
it gives them royalties and other payments to grow their economies.

3. Risk Reduction.
Businesses often expand internationally to offset the risk of stagnating growth in their home country as
well as in other countries where they are operating. . If we see the, for instance, ever since the Western
countries saw their growth rates slip to below 3% (in cases recording negative growth i.e. depression),
the Western multinationals have made a beeline to the emerging markets that are growing in excess of
5%.Further, by operating in a basket of countries as opposed to a few, they are able to manage political,
economic, and societal risks better. We had discussed the characteristics of these risks in earlier articles.

Q4: What are the different entry modes of IB? Elaborate your answers discussing the
advantages and disadvantages alongside the relevant examples.
1: Exporting.
Trading is the immediate offer of merchandise and/or administrations in another country. It is
conceivably the most popular technique for entering an unfamiliar market, just as the least danger. It
might likewise be practical as you won't have to put resources into creation offices in your picked
country – all products are as yet delivered in your nation of origin at that point shipped off outside
nations available to be purchased. In any case, rising transportation costs are probably going to build the
expense of sending out soon.
Advantages:You have to pick out your representatives in the distant places market. You can makes use
of the direct exporting approach to take a look at your merchandise in global market earlier than making
a higher funding in the distant places market. Ability to recognize place and trip curve economies.
Disadvantages:the negative aspects over exporting are the expenses regarding transporting fit-out in
accordance with the country, which may stand high and do have a terrible affect regarding the
environment. In addition, half countries allow tariffs on coming goods, as desire influence the firm’s
profits.
Example: toughness Mexico money owed because forty percent over the lading exported out of Texas.5
the Internet has also taken exporting easier. Even little corporations perform get entry
tonecessaryfactsaboutforeignmarkets, look at a target market, lookup the competition, then effect
lists of dynamic customers.
2: Turnkey projects.
It is an uncommon method of completing worldwide business. It is an agreement under which a firm
concurs – for a compensation – to completely do the plan, make, and prepare the creation office and
move the task over to the buyer when the office is operational.
Advantages:The opportunity for a company to creates a plant and earn income in to a overseas nation
or international locations in which direct funding are restrained additionally loss of expertise. A turnkey
approach also can be much less unstable than traditional FDI.
Disadvantages:Creating efficient rivals need of long-term want presence. Entering a demand including a
turnkey task may prove so much a company has no long time period interest within the united states of
America who be able become a disadvantage. The promoting concerning science through a
turnkey assignment is also selling competitive expertise according to strong yet then true competitors.

Example:A Pakistani metal-refining company begin a venture withinside the overseas marketplace and
assign the settlement of ten years whilst the venture will entire the plant come for complete operation
their the time period turnkey. All the agreement will entire on its time.
3: Licensing:
The homeproducerrentals the properto apply its highbrow property, e.g., technology, paintings method,
patents, reproduction rights, logo names, logos etc. to a producer in an overseas county for a fee. Here
the producerwith inside thehomeUnited States is called ‘licensor’ and the producerwith inside
theoverseasUnited States is called ‘licensee’

Advantages: The licensing mode incorporates distinctly mean funding on the part concerning licensor,

Licensing paint additionally carries ignoble monetary chance in imitation of the licensor. Licensee
escapes himself beyond the risk regarding manufacture failure.

Disadvantages: Licensing agreements minimize the market opportunities because of each the licensor

or licensee.The competitor execute lie the overseas accomplice who is selling its products into the locati
ons where the parental agency is meanwhile in. Also dropping concerning the rule on the licensee 
Manufacture yet advertising operations and practices leading after impairment regarding quality.

Example:The Pepsi cola granted license to Heineken of the Netherlands giving them the extraordinary
proper to supply and promote Pepsi cola with inside the Netherlands.

4: Franchising:
A contractual access color into who some organization (the franchiser) elements another (the
franchisee)together with unclean worship or ignoble help in conformitywith a overseas employer 

For a special period concerning epoch yet receives a royalty within return. And whereas licensing is

pursued principally via industrial firms, franchising identification devoted exceptionally by means
of employ firm.

Advantages:The Company is relieved of among the fee and dangers of commencing an overseas
marketplace on its own. Instead, the franchisee usually assumes the ones prices and dangers. Franchisor
can get the data concerning the marketplace, culture, customs and surroundings of the country.

Disadvantages:Franchisees can enjoy a lack of organizational flexibility in franchising agreement. Both

the events have the obligations to preserve product pleasant and product promotion. There is a scope
for false impression among the events.

Example:Fast food businesses kind of McDonalds’s, Domino’s Pizza Hut, KFC bear franchised eating

places worldwide. NIT then Aptech hold decorate franchisees of Africa Antarctic East Asia,
Gulf nations then china.

5: Joint ventures:
Is an entity shaped among or greater events to adopt financial interest together? The events comply
with create a brand new entity via way of means of contributing equity, after which they proportion
with inside the revenues, expenses, and manage of the enterprise. Organization wishing to increase into
remote places markets can form joint ventures with community companies in the foreign places vicinity,
wherein each joint mission companions percentage the rewards and dangers associated with the
enterprise.
Advantages:
Benefits beyond a native partner’s capabilities of the militia country’s competitive conditions, culture,
language, politic structures then enterprise system. Shared fees yet hazards with partner.
Reduced politic risk.

Disadvantage: forward drawback is licensing an employer as enters of a league danger hazards Grant

limit of its science in accordance with its partner. May now not understand ride nook or region
Economies. Shared possession execute propulsion in accordance with conflict.

Example:Sony-Ericsson is a joint project through the Japanese customer digital organization Sony
Corporation and the Swedish telecommunications organization Ericsson to make cellular phones.

6: Wholly owned subsidiary:

WOS is a corporation this is absolutely owned with the aid of using the usage of a few different
corporation. The enterprise corporation that owns the subsidiary is called the parent company or
preserving company, the discern company will maintain all of the subsidiary’s not unusual stock. Since
the figure agency owns all of the subsidiary’s inventory. It has the right to lease the subsidiary’s board of
directors which controls the subsidiary.

Advantages: When a company’s aggressive benefits is primarily based totally on technological

competence, a completely owned subsidiary will regularly be the desired access mode as it reduces the
threat of dropping manipulate over that competence. A utterly owned subsidiary provide a company
tight manipulate over operation in exceptional countries.

Disadvantages:High charge and risks. Use regarding diversification perform hold a downside because
such may additionally motive the father or mother employer after loss center of attention concerning
such as it does best. You need to be aware as the father or mother company does bear a criminal duty 
to honor the company pastimes over its subsidiaries. There can also be a hostilities on activitybetween
the dad or mum agency or its subsidiaries.

Example: This is a mangy of vertical integration the place organizations between a providechain are

under the control regarding a frequent owner. For example, a vehicle manufacturing organization might
also bear various completely owned subsidiaries, along with a cap corporation yetvarious differentself-
components corporations

Q5: What are the seven main instruments of Trade policy?The followings are the terms of
trade policy.

1: Tariffs.
This tax is imposed by Governments on goods and services which are imported from other countries
that serves to increase the price. Also tariff is such a tax which produce revenue for the government.
Furthermore, it is also clear that government gains, because the tariff increase government revenue
finally, it raises the revenue of government.

2: Subsidies.
A subsidy is an incentive given by the government to individuals or businesses in the form of cash,
grants, or tax Direct Taxes Direct taxes are one type of taxes an individual pays that are paid straight or
directly to the government, such as income tax, poll tax, land tax, and breaks that improve the supply of
certain

3: Import Quotas.
An import quota is a type of trade restriction that sets a physical limit on the quantity of a good that can
be imported into a country in a given period of time. Quotas, like other trade restrictions, are typically
used to benefit the producers of a good in that economy.

4: Voluntary Export Restraints.

A voluntary export restraint (VER) is a trade restriction on the quantity of a good that an exporting
country is allowed to export to another country. This limit is self-imposed by the exporting country.

5: Local Content Requirements.

The fastest growing of these measures are local content requirements (LCRs), which are policies
imposed by governments that require firms to use domestically-manufactured goods or domestically-
supplied services in order to operate in an economy.

6: Administrative Polices.
Administrative policies inform employees of the office's rules, the business's expectations and values,
and HR-related issues such as paid time off and health insurance eligibility. Administrative policies must
cover a wide array of needs within the business and serve as a guide for how it operates.

7: Antidumping Policies.
An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports
that it believes are priced below fair market value. ... While the intention of anti-dumping duties is to
save domestic jobs, these tariffs can also lead to higher prices for domestic consumers.

Q6: Write down notes on the following international organization.

1: IMF.
The International Monetary Fund (IMF) is an organization of 190 countries, working to foster global
monetary cooperation, secure financial stability, facilitate international trade, promote high
employment and sustainable economic growth, and reduce poverty around the world. Created in 1945,
the IMF is governed by and accountable to the 190 countries that make up its near-global membership.
The purpose to ensure the stability of the international monetary system—the system of exchange rates
and international payments that enables countries (and their citizens) to transact with each other.

2: GATT:
The General Agreement on Tariffs and Trade (GATT), signed on October 30, 1947 by 23 countries, was a
legal agreement so that to minimize the barrier of International trade by eliminating or reducing quotas
while preserving significant regulations.1 The GATT was intended to boost economic recovery after
World War II through reconstructing and liberalizing global trade.
3: World Bank:
The World Bank is an international organization dedicated to providing financing, advice, and research
to developing nations to aid their economic advancement. The bank predominantly acts as an
organization that attempts to fight poverty by offering developmental assistance to middle- and low-
income countries.

4: World Trade Organization. (WTO)

The WTO was created in 1995 and the WTO is an international institution that oversees the global trade
rules among nations and countries. However, the WTO is simply based on agreements which is signed by
the majority of the world’s trading nations.