Question

As a global manager, create a scenario for analysis using the three-sector model: Real Loanable Funds Market, Real Goods Market, and the Foreign Exchange Market for Question A. There is no “set” answer here. You are the manager doing the analysis and setting up the scenario. Use your own assumptions.

A. In the post-World War II period, the economies of Japan and Germany were rebuilt, and both economies were able to achieve economies of scale in the steel and automobile industries. In the mid-1990s, India and China built labor-intensive industries in the apparel industry, followed by other labor intensive industries expanded through an export-led growth policy on the part of China. Vietnam followed this type of policy beginning in 1986. The country has achieved stable growth, low inflation, and increasing prosperity. In the early 2000s, South Korea became a major producer of automobiles, and also expanded production in technology and related consumer goods for export. Currently, High Income economies (using the World Bank GNI per capita classification system) in North America, Europe, and the Far East (the Triad Area) engage extensively in trade in consumer goods. We find that the current level of global exports is about $19 trillion. The trade between nations of the Triad Area represents about $9.5 trillion. In the euro-zone, there is a division between stronger nations (Germany and France, for example) compared to other nations facing significant macroeconomic problems (Greece and Spain, for example).

Answer 1

A) If i were the global manager analysing the global scenerio about the three sector economy model of real loanable funds, real goods ,market and foreigh exchange i take following measures to cope up with the scenerio. theforces which shifts the demand curve for capital are the changes in demand for goods and services , tax policy , changes in expectations, relative factor prices and technology change. The real interest rate determines the rate of interest in loanable funds . The differences in inflation can be adjusted by cost borrowing . The loanable funds. The rela goods market offer natural as well as organic goods that gives better options for purchasing healthy foods and beauty products. foriegh exchange risk will manged where fluctuations in exchange rate impact on business profitability. This further riskc can be reduced make and receive p[ayments in our own currecy. I f the suppliers of foriegh exchange with various payments to take advantage of exchange rate fluctuations.

after post world war germany and germany created states for least start new wars. After the defeat in world war 2 , they led the allies in the occupation and rehabilation of the stae japanese. Along with the manufactures of Japan producing very reliable affordable and poplular cars in1990s , they became the largest car producing nation in world by 2000. But later the market share of Japan decreases slightly in recent years because of the increasing infulence of south cvorea China and India in the competion. Thus the Automobile industreis began to produce more products. It also provided job oppurtunities for Japanese by increase number of factories abnd industries. The post world war 2 revivla of the German induustry of automobiles from almost the total destruction was spectaculus feet.

In mid 1990s china and india built labor intensive industry in apparel industry and  followed by other labor intensive industries expanded through an export-led growth policy on the part of China. Vietnam followed this type of policy beginning in 1986. In post 1978, India did not seek for FDI. During this p[eriod china stated rebuiding their manufacturing aglumaration effect later that would become the most powerful magnet for foreign direct investment by 1990s and 2000. In mid 1990s the economic planners and indian leaders embrassed foreign direct investment and its multiple advantages. But it was not accurate to say that China and India completed their foriegn investment . As well as the (Indian leaders were not at all interseted in calling foreign direct investment . In 1990s India pulled most of their people in world out of their poverty. Around 170 million people came out of poverty between 1990s and 2013 and there by made a second biggest impact. It created an export oppurtunutiy for indonesia ,Uzbekistan , Vietnam ,India and ither emerging low income economies.

The country South korea established the model of samsung motors in 1994 and start selling it in 1998 . Initially the company faced ,many financial difficulties but later it become the major producers of automobiles by 2000. Hyundai is considered to be the largest company engage in car manufacturing in south corea . And it created a benchmark in quality by attaining the sales over 10 million in U.S. Hyundai becomes the most selling model of car with around 103000 volume in sales. It also acheived around 100000 units for the cureent years. South Koreas is one of fastest growing amoung the other developed countries.

   Currently, High Income economies in North America, Europe, and the Far East engage extensively in trade in consumer goods. We find that the current level of global exports is about $19 trillion. The trade between nations of the Triad Area represents about $9.5 trillion. In the euro-zone, there is a division between stronger nations compared to other nations facing significant macroeconomic problems .The GDP groeth of Greece is also has an average , since 1990s being higher than average of Europe . They continously face significant problems such as taxivation. , corruption , unemployment levels, beurocracy and also global competion. The debt crisis of greek government oridnated from the heavy spending of government and the problem esculated the years due to slow down of economic growth. In 1981 the countries economy and finances where in better position , with a debt to GDP ratio of 28% and budget deficit below 3% of GDP. North America has given a rise in the manufacturing sector in late 50s In the begoinning the european nations where the large manufacturing powers. The US was top in manufacvturing with Mexico and Canada making significant progress. North europe is a stae distribute wealth equally amoung their people. But in the case of southern corruptio had made from the side of politicial strength in economy.