Ch016ForeignDirectInvestmentandCrossBorderAcquisitions讲课稿Word文档下载推荐.docx

Ch016ForeignDirectInvestmentandCrossBorderAcquisitions讲课稿Word文档下载推荐.docx

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ShareholderDiversificationServices

Cross-BorderMergersandAcquisitions

PoliticalRiskandFDI

DaimlerChrysler:

TheFirstGlobalCarColossus

StoriesPastandPresent

Summary

MINICASE:

EnronversusBombayPoliticians

1Undera1981VoluntaryTradeAgreementJapaneseautomobilemanufacturerswerenotallowedtoincreasetheirexportstotheU.S.market.Asaresult:

a）Theyexitedthemarket

b）Hondawasmotivatedtocircumventthetradebarriers.

c）Honda’sFDImayhavebeenpartofanoverallcorporatestrategydesignedtobolstertheircompetitivepositionvis-à

-vistheirdomesticrivalssuchasToyota

d）Bothb）andc）

Answer:

d）

2FollowingHonda’sFDIintheU.S.,

a）TheU.S.governmentimposedaVoluntaryTradeAgreementunderwhichJapaneseautomobilemanufacturerswerenotallowedtoincreasetheirexportstotheU.S.market.

b）ToyotaandNissanmadedirectinvestmentsinAmerica

c）SalesofHondasdeclined

d）noneoftheabove

b）

3Honda’sdecisiontobuildaplaninOhio

a）WaswelcomedbytheUnitedAutoWorkers

b）WasencouragedbyassistancefromthestateofOhio,includingimprovedinfrastructurearoundtheplantandabatementofpropertytaxes.

c）InvolvedsettingupaspecialforeigntradezonethatallowedHondatoimportautopartsfromJapanatareducedtariffrate.

d）Alloftheabove

4

WhenfirmsundertakeFDI,

a）TheybecomeMNCs

b）Theyreducetheirtaxratesincetheycantelleachcountrythattheydobusinessinthattheypaidtheirtaxesinothercountries.

c）Thecanexploitworkersbypayingthembelow-marketwagesindepreciatingcurrencies.

a）

5FDIcantaketheformof:

a）Greenfieldinvestment

b）Cross-borderM&

A

c）Establishingnewproductionfacilitiesinaforeigncountry

6TheFordMotorCompanyrecentlyacquiredMazda,aJapaneseautomaker,andJaguar,aBritishautomaker.

a）Thisisanexampleofcross-borderM&

b）ThiswasaGreenfieldinvestment

c）Botha）andb）

d）Noneoftheabove

7AccordingtoarecentUNsurvey,theworldFDIstockgrewatwhatraterelativetoworldwideexportsofgoodsandservices?

a）TheworldFDIstockgrewtwiceasfastasworldwideexportsofgoodsandservices.

b）TheworldFDIstockgrewatthesamerateasworldwideexportsofgoodsandservices.

c）TheworldFDIstockgrewhalfasfastasworldwideexportsofgoodsandservices.

8JapanplaysamajorroleasanexporterofFDI.AsarecipientofFDI

a）JapanreceivesasmuchFDIasitexports,makingitamajorplayeronbothfronts.

b）Japanplaysarelativelyminorrole,reflectingavarietyoflegal,economic,andculturalbarrierstoFDI.

c）Japan’sreceiptsofFDIarethirdintheworld

9

ThethirdmostimportanthostcountryforFDIis

a）TheUnitedStates

b）Japan

c）China

d）Mexico

c）

10MNCshaveinvestedinChina

a）Bylowermaterialcosts.

b）Bylowerlaborcosts.

c）ByadesiretopreempttheentryofrivalsintoChina’spotentiallyhugemarket.

11FDIstocks

a）Arethecommonsharesofmultinationalcompaniesthatinvestabroad

b）AremutualfundsthatinvestinFDI

c）Representtheaccumulationofpreviousyear’sFDIflows

d）AtthesumtotalofcurrentyearFDIflows

12ThedominantsourceofFDIoutflows

a）Severaldevelopedcountries

b）Afewunderdevelopedcountriesnexttowealthyneighbors,likeMexico

c）AfricaandChina

13Thekeyfactorsthatareimportantinafirm’sdecisiontoinvestoverseasare:

a）Tradebarriers,imperfectlabormarket,andintangibleassets

b）verticalintegration,productlifecycle,andshareholderdiversificationservices

c）profitmaximization,globalprestige,andcompetition

d）a）andb）

14Whydofirmslocateproductionoverseasratherthanexportingfinishedgoods?

a）Shippingcosts

b）Firmsseektoextendcorporatecontroloverseas

c）Imperfectfactormarkets

15

WhilethereisnocomprehensivetheoryofFDI,manyexistingtheoriesemphasize:

a）Imperfectionsinproductmarkets.

b）Imperfectionsincapitalmarkets

c）Imperfectionsinlabormarkets

16Internationalmarketsforgoodsandservicesareoftenimperfect.WhichistheMOSTcommonandMOSTimportant?

a）Actsofgovernments.

b）Naturalbarrierslikedistance

c）Culturalbarriers

d）Lackofknowledge

17Whydogovernmentsregulateinternationaltrade?

a）Toraiserevenue

b）Protectdomesticindustries

c）Pursueothereconomicobjectives

18Tradebarrierscanarisenaturally.Whichofthefollowingrepresentanaturalbarriertotrade?

a）Transportationcosts

b）Quotas

c）Tariffs

d）Transactionscosts

19InapushtoservetheNorthAmericanmarketSamsung,aKoreanfirm,chosetolocateproductionfacilitiesinMexico,mainlybecause

a）OflowerlaborcostsinMexico

b）TocircumventtradebarriersimposedbyNAFTA

c）BecauseofcolderweatherinCanada

Rationale:

thisiswhatthebooksays,butconsiderpartialcreditforb）

20

Laborservicesinacountrymightbeunderpricedrelativetoproductivitybecause:

a）Workersarenotallowedtofreelymoveracrossnationalboundariestoseekhigherwages.

b）Somecountriesdoabadjobofeducatingtheirworkforce,consequentlytheyarenotveryproductive

c）Insomecountriesthereisashortageofcapitalinvestment.

d）Alloftheaboveareequallyimportant

21Factorsofproductionincludeland,labor,capital,andentrepreneurialability.Ofallthefactormarkets,theMOSTIMPERFECTisthe

a）Labormarket

b）Capitalmarket

c）Realestatemarket

d）Marketforentrepreneurialability

22Severeimperfectionsinthelabormarketleadto

a）Persistentwagedifferentialsamongcountries

b）Persistentexchangeratevolatilityamongcountries

c）Persistentinterestratedifferentialsamongcountries

23Severeimperfectionsinthelabormarketarisefromimmobilityofworkersduetoimmigrationbarriers.Asaresponse,firmsshouldconsider

a）Movingtotheworkers.

b）Movingtocountrieswherelaborservicesarethelowestinabsoluteterms.

c）Movingtocountrieswherelaborservicesareunderpricedrelativetoproductivity.

d）Hiringillegalimmigrants.

24Coca-Colahasinvestedinbottlingplantsallovertheworldratherthanlicensinglocalfirms

a）Becausetheforeignerscan’tbetrustedtofollowthesecretrecipe.

b）BecauseCoca-Colawantedtoprotecttheformulaforitsfamoussoftdrink.

c）BecauseoftheinternalizationtheoryofFDI

25

Theboomerangeffect

a）ThepossibilitythatifthesecretformulaofCoca-Colawereleaked,thatotherfirmswouldcomeupwithsimilarproductsandhurtCoca-Cola’ssales.

b）ThepossibilitythatFDIinanundevelopednationwillleadtoagroupofworkerswhohaveenoughmoneytoaffordthefirm’sproducts,leadingtoanincreaseofsalesandincreaseofworkersandsoon.

c）ThepossibilitythatFDIinanundevelopednationwillleadtoagroupofdomesticworkersnolongerhaveenoughmoneytoaffordthefirm’sproducts,leadingtoandecreaseofsales.

26Inthe1960s,Coca-Cola,whichhadbottlingplantsinIndia,facedstrongpressurefromtheIndiangovernmenttorevealtheCokeformulaasaconditionforcontinuedoperationsinIndia.Asaresult

a）CokeagreedtorevealtheformulatotheIndiangovernment,whichhasmaintaineditasastatesecrettothisday.

b）Insteadofrevealingtheformula,CokewithdrewfromtheIndianmarket.

c）Cokewasabletosuccessfullylobbythegovernmenttowithdrawthisdemand.

27MNCsmayundertakeoverseasinvestmentprojectsinaforeigncountry,despitethefactthatlocalfirmsmayenjoyinherentadvantages.Thisimpliesthat

a）MNCsaremakingamistakeinthiscaseandwillhavetoeventuallywithdraw

b）MNCsshouldhavesignificantadvantagesoverlocalfirmssuchascomparativeadvantagesduetointangibleassets

c）Thelocalfirmswillnothavetocompeteduetotheirinherentadvantagesovertheforeigners.

28Examplesofintangibleassetsinclude

a）Technological,managerial,andmarketingknow-how

b）SuperiorR&

Dcapabilities

c）Brandnames

29Intangibleassetsareoftenhardtopackageandselltoforeigners.

a）Becausetheyusuallydefaultonthecontractsthattheysign

b）Asaresult,thereismoreFDIthantheremightotherwisebe.

c）Becausepropertyrightsinintangibleassetsaredifficulttoestablishandprotect,especiallyinforeigncountrieswherelegalrecoursemaynotbereadilyavailable.

d）b）andc）

30

AccordingtotheinternalizationtheoryofFDI

a）Firmsthathaveintangibleassetswithapublicgoodpropertytendtoinvestdirectlyinforeigncountries.

b）Proper