ECO/365 WEEK 5 DQ’s - 7101

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DQ1:

In this election year there is going to be a lot of discussion related to trade and the impact on the U.S. economy.  Based on our reading this week, answer the following questions:

 

1.    How does global economic competition affect the price elasticity of demand in the domestic market and decisions related to the strategy a firm uses to compete?  Explain your answer fully.

 

2.    Why do most economists oppose trade restrictions? Who have been the winners and losers as a result of the North American Free Trade Agreement? Explain your answer fully.

 

DQ2:

In this seemingly ever changing technological world, advances in technology play a key role in economic developments and opportunities.  Based on our reading this week, answer the following questions:

1.        What are the effects of innovation and technology on the cost of production? 

2.    How does technology affect market structure and real-world competition? Which market structure is best suited for technological innovation? Explain your answer.

3.    How have technological innovations affected your organization?

Solution Description

DQ1:

In this election year there is going to be a lot of discussion related to trade and the impact on the U.S. economy.  Based on our reading this week, answer the following questions:

 

1.    How does global economic competition affect the price elasticity of demand in the domestic market and decisions related to the strategy a firm uses to compete?  Explain your answer fully.

Global competition causes an increase in the supply of products that can be used as an alternative to the local products. Therefore the prices get more elastic since now the local producers need to reduce their prices in line with the foreign competition and compete with foreign products

With an increase in global competition, the decisions related to strategy start taking into account the competition and customer demand. The increased glob