Question

You have been recently hired by a multinational firm that manufactures airplanes parts. They are interested in investing in a new factory. However, the CEO is unsure of where they should invest. The CEO would like to either invest in a developed or a developing country and your input is valuable to his decision. Your focus will be on providing specific information on both a developed and developing country, providing that both countries have data for the last 20 years. You will need to provide support, through your analysis, for which country you think will be best for this factory to invest in. Do not pick a country that does not have data that is easily accessible.

Answer 1

When it comes to nominal terms, the United States is the largest national economy in the entire world and when we take PPP into consideration it is rated second largest economy representing 22% of global national GDP and 17% gross world product. In the second quarter of 2015, it was estimated that the GDP of the USA is around $18 trillion.

GDP growth in United States

year                    GDP                      

1999                      4.8

2000                       4.1

2001                         1.00

2002                       1.8

2003                        2.8

2004                        3.8     

2005                         3.3

2006                         3

2007                         2.6

2008                          0.3

2009                             -2.8

2010                           2.5

2011                              1.6

2012                               2.3

2013                                2.2

The US economy is the largest employment facilitating economy with 22 billion employment opportunities, The small business organization form the largest employment providing sector in the economy representing almost 53% of total US manpower. If we look at the US economy, currently, transport, communication and energy sector are providing more than 4 million jobs and US economy has the one of the longest highway system in the world. The country is the second largest consumer of the energy in the entire world. Petroleum products are the main source of this energy requirement having an estimated 40% of nation’s energy requirements. The transport system in the US economy, most of the public airways existed in the nation

China’s socialist market economy is considered to be the second largest economy in the world and it is considered as the largest economy when it comes to PPP as per IMF. It is considered to be the fastest growing economy in the world having a growth rate of almost 10%.

GDP growth in China

1999                                7.6

2000                                8.4

2001                                8.3

2002                                9.1

2003                                10

2004                                 10.1

2005                                  11

2006                                    12.7

2007                                    14.2

2008                                     9.6

2009                                    9.2

2010                                   10.6

2011                                     9.5

2012                                     7.7

2013                                     7.7

The major role in China’s economy is played by the transport, communication and energy system. These sector provides more than 60% of employment to the country’s citizens.

In the above data we know that most suitable investing country is chaina.because economic indicator and GDP growth high. At the same time china is fast growing economy.