Mercantilism, Free Trade, Globalization, and Companies
Mercantilism
Advantages:
- Capital accumulation through increased holdings of gold and silver (mercantilism), which was a sign of wealth for the nation.
- Emergence of manufacturing production (manufacturing facilities), which is labor-intensive.
- Source of wage labor.
Cons:
- The process of capital accumulation through capital appreciation.
- Relentless pursuit of profits for companies.
- Socioeconomic system is unethical because it favors some and disadvantages others.
Free Trade
Free trade is an economic concept
Read MoreFinancial Information Restatement in Inflation
Classification of Financial Information for Restatement
Financial information is classified for restatement purposes as:
- a) Operation
- b) Funding
- c) Investment
Monetary Effect of the First Update
The monetary effect of the period, resulting in favorable outcomes, will be up to an amount equal to the net financing costs. These costs consist of interest and exchange rate fluctuations, and generally, all concepts grouped within the expenses and financial products accounts. Any surplus will be considered equity.
Read MoreBusiness Growth Factors: Opportunities & Threats
Joint Ventures vs. Strategic Alliances
1. Distinguish between joint ventures and strategic alliances:
- Joint Venture: Occurs when two or more businesses share the costs, risks, control, and rewards of a business project. They often use this to enter foreign markets.
- Strategic Alliance: Two or more businesses cooperate in a business venture for mutual benefit, sharing the costs of product development, for example.
Franchising: Advantages and Disadvantages
2. What are the advantages and disadvantages of
Read MoreInternational Trade: Theories, Benefits, and Regulations
Introduction to International Trade
Modern economic theories about international trade started in the 16th century. We can consider two main doctrines:
- Mercantilism
- Free trade
Mercantilism
Mercantilism is the economic doctrine in which government control of foreign trade is of great importance for ensuring the prosperity and security of the state. In particular, it demands a positive balance of trade. Mercantilism dominated western countries’ economic policy and discourse from the 16th to late-18th centuries.
Read MoreUnderstanding Consumer Demand: Indifference Curve Theory
Consumer Demand Theory: Indifference Curves
1. Definition
An indifference curve illustrates various combinations of product X and product Y that provide equal utility or customer satisfaction. A higher indifference curve indicates a higher degree of satisfaction, while a lower curve represents lower satisfaction.
2. Marginal Rate of Substitution
The marginal rate of substitution of Y for X (MRSxy) refers to the amount of Y a consumer is willing to sacrifice to obtain an additional unit of X, while remaining
Read MoreDemographic Shifts, Economic Cycles, and Industrial Evolution
Demographic Shifts and Agriculture
- Declining birth rates and slowing population growth.
- Increased migration towards urban centers, creating a rural exodus.
- Intercontinental migrations did not hinder this slowing population growth.
- Agriculture suffered a crisis caused by the transportation revolution.
- Food arrived in Europe at low prices, creating competition for local agriculture.
- New, more modern agriculture emerged in Europe, contrasting with more traditional, less technologically advanced methods.
- Capitalism