Question

Reflect on the following question "As an economy develops and becomes more integrated into the world economy how do its costs of production change and how well can they be managed both in the short-run and long-run?” Explain your opinion.Try to add real examples, either from own experience(any global firms) or from other business, to enrich answer quality and to connect theory with practice.

Note , the answer should be typing by computer, but not written on paper

Answer 1

Answer

As , the Economy of an organnization developes and expand globally adn contribute towards the global economy , the cost of production Increases because , when we expand the organization , the different segment of the business get affected , which require high strategic planning , management , staffing ,execution , etc .Also , the Global economy needs standardization which means that when an organiization econnomy get integrate in the world economy it has to be standardized into proper production.Particulalry if we consider the cost of production ,So in short run and long run , it depends upon the shock in demand and supply .Based on these shocks , the production changes .Let us sayy for example Chineses prooduct and Apps are currentlly banned by the Govt. of India due to some cross border tension over the territory .This has caused billion of losses to the chiness economy although it is a intergrated part of world economy but the production got sudden decline and also for indefinite time the production for infia by the china has stopped .Now this is for short term But in long term , depending upon the strategies by different firm in china will determinie the production later on and its supply in india through some collaborator or using black marketing etc sort of things .So, they can be managed in both short term and long term by properly standardizing the eproduction for all corners where the business is expapnded so that iif one of the economy is affected then other will be stable .

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