Coursework

Governments can give local firms competitive advantage in the international market through subsidies. If the government subsidizes the price of raw materials used by these firms, the price of goods produced becomes low hence these goods are more preferred. The government can also create the competitive advantage through reduced tax on the activities of these firms. This also plays the role of reducing the costs of the firm hence the price of goods from such firms is low.

Buy Free Custom «Coursework» Essay Paper paper online

 

* Final order price might be slightly different depending on the current exchange rate of chosen payment system.

Order now

Different corporate tax laws in different countries create competitive advantage for some firms. In countries where deferred corporate laws are allowed such as the United States, the international firms are able to invest the income earned before they can pay tax on the due dates. Deferred tax laws allow international subsidiary companies to pay tax later as compared to local companies. The tax rates in different countries vary from one country to another. Companies from countries that charge lower corporate tax rates have competitive advantage in that their costs of production are lower hence can charge lower price to attract more customers.

Stay Connected

Live Chat Order now
Stay Connected

If lower corporate tax rates are imposed, unfair competitive advantage is created. This is because taxes have the impact of increasing costs of a company, which consequently affect the price of goods and services produced. This means that companies being charged lower tax rates have unfair advantage in the international market since they can sell their products at lower prices.

The United States trade deficit can be eliminated through a 40 percent revaluation of Yuan. This is according to investigations done by Federal Reserve. This revaluation will bring about balance of trace in the global economy. Capital flows in the international market will also be balanced. This change can solve trade deficit.

Limited time Offer

0
0
days
:
0
0
hours
:
0
0
minutes
:
0
0
seconds
Get 19% OFF

The correction of the US trade deficit would positively affect productivity and creation of jobs. Revaluing Yuan upwards will make American goods and services cheaper as compared to those from other countries. Since China is the major competitor of the United States in the international market, this would increase the demand for American goods. As a result, productivity in the United States will increase to meet the growing demand. To produce the required goods and services, demand for labor increases hence creating more jobs in the United States.

Related Economics essays

  1. Business Profile of Finland essay
  2. European Union essay
  3. Globalization essay
  4. Long-Term Plan for Black America essay
  5. Employment essay
  6. Newspaper Article essay
  7. The National Debt of the United States essay
  8. Daniel J. Phaneuf essay
  9. Methods of Avoidance International Double Taxation essay
  10. Is Korea a Free Market? essay

0

Preparing Orders

0

Active Writers

0

Support Agents

Limited offer
Get 15% off your 1st order
get 15% off your 1st order
Close
  Online - please click here to chat