International Economics: Trade, Finance, and Globalization
International economic studies how countries influence each other’s economies through two acts: 1. International trade (exchange of goods and services across borders) 2. International finance (movement of money for loans, investments, and financial assets). Gains from Trade: Countries benefit by specializing in goods having a comparative advantage and trading for what they lack.
Comparative Advantage: A country is more efficient in producing a specific good, it specializes in that product and trades
Read MoreCompetitive Pricing Strategies and Market Dynamics
Competitive Pricing Strategies
Competition-oriented pricing: The first thing to consider is the stage of the market or industry in its life cycle and the company’s position within it. This will directly affect what is called “price architecture” and may cause a loss of control in the face of competitors’ or distributors’ decisions.
In this case, a firm ensures that the prices it sets are in keeping with those charged by competitors, often referred to as the going-rate price. This kind of pricing
Read MoreProject Management: Life Cycle, Business Significance, and Working Capital
1. Project Life Cycle and its Main Components
The life cycle of a project is comprised of seven major stages, each with a specific duration:
- Idea: The initial concept for the project, whether it involves creating a business or developing a product or service.
- Profile: Outlining the project’s scope, objectives, and structure. This stage also involves estimating the project’s base cost.
- Pre-feasibility: Conducting market research to determine the target market and assess the initial feasibility of
Enterprise Components, Operations, and Growth Strategies
Components of the Enterprise
The enterprise is composed of several key elements:
- Capital:
- Instrumental Capital: Technical assets that remain in the company long-term and are necessary for its operations. This includes rights related to patent applications or trademarks.
- Materials: Raw materials, finished goods, and work in progress needed to complete the production cycle.
- Financial Capital: Liquid financial resources that make up the treasury of the company.
- Human Element: People who contribute their
Causes and Effects of the 1929 Stock Market Crash
Causes of the New York Stock Market Crash of 1929
To understand the causes of the New York Stock Market crash, we must consider the differences between the real economy and the financial economy. The real economy responds to the smooth running of enterprises, i.e., their productivity and market acceptance. The financial economy is the share prices of companies on the stock exchange. There must be a balance between the two, but this is not always the case. Actions may be overvalued because of speculation
Read MoreBusiness Funding and Financial Resources
Funding
To carry out the activity of the company, it needs means of payment that allow them to make investments, and this is called the funding source. Funding refers to the liquid assets or means of payment available to the company to meet its cash needs. It can be classified as follows:
- Short-term funding source: When the term of repayment is less than a year.
- Long-term funding source: When the term of repayment is higher than a year.
- Internal financing: Profits, distributed quotas, and amortization.