[Economics and Global Issues for General Managers]
[EC.7100- LCA 20377 ]
[***Spring, 2006***]
Instructor:
Professor Michael Tansey
Classroom:
C 204
Meeting Time: FS 10:45 a.m.-1:15 p.m.
Office:
CONWAY 313
Office hours: MW noon-1:20: Thursday. 3-5:45 p.m., after class and by appointment
Telephone:
(Cell phone at 913-485-7550)
E-mail:
michael.tansey@rockhurst.edu
Course Website: http://cte.rockhurst.edu/tanseym
TEXTOOK: Wild, Wild, Han. “International Business” 3rd edition Prentice Hall 2006
Class SYLLABUS, ASSIGNMENTS, NOTES (chapters), CASES, POWER POINT
SLIDES FROM LECTURE, AND STUDENT EXAMPLES will be on the website:
cte.rockhurst.edu/tanseym under the course “EXECFEL.” All of these items are added
and updated as the class develops, and you should consult the site regularly. Feel free to
examine other sites, particularly the principles courses if you wish to review the
principles of economics.
While the course indicates the important subject matter to learn, it is suggested
that you find and consult managerial economics textbooks and any other economics
books that may be helpful on specific subjects. Particularly good because it works
problems out in detail is:
James McGuigan and R. Charles Moyer. Managerial Economics West Publishing Co.
7th ed. West Publishing Co., New York, 1996 (or later editions)
It is also assumed that you have access to a textbook in the Principles of Economics (preferably
the textbook used in your undergraduate economics course) to consult with the basic theories and
principles of economics. This course applies those theories and presumes you already have
exposure to them.
The Wall Street Journal will be used for course assignments. You should also be
receiving subscriptions to the Wall Street Journal (thanks to the generous support of Barnett
Helzberg) which should be available through your Rockhurst e-mail account. That capability
will be useful for the assignments, since all assignments must be sent to the above e-mail address
in digitized form. We will also use the WSJ because the quality of their business reporting is
more reliable than the internet materials for the purposes of the course.
LEARNING OBJECTIVES:
After completing this course you should be able to:
1
2
3
4
5
6
7
8
9
10
11
12
13
The most important skill in a job with any organization is
communication. This course is designed to give you practice in
using these communication skills: (1) speaking, (2) writing, (3)
solving problems, (4) reading the newspaper, (5) communicating
paperlessly with the use of computers AND (6) discussing major
economic developments. Using an executive management context
for learning, the student should be able to:
Know how to formulate the essential elements unique to different
business economic studies (location analysis, cost effectiveness
studies; cost-benefit studies, industry studies, portfolio analysis,
capital budgeting, and business plans) for the purposes of global
planning. [Level 4: Analysis]
Have the capability to present or evaluate arguments for and against
government intervention in international markets. [Level 4: Analysis]
Discuss and explicate basic issues concerning government
intervention, emerging global technologies, and ethics in leading
organizations in different cultures. [Level 4: Analysis]
Reinforce fundamental concepts of supply and demand within
international markets. [Level 4: Analysis]
Prepare effectively to handle cultural, historical, and national issues
that impact global decision-making. [Level 4: Analysis]
Reason through and identify the efficiency and ethical dimension of
problems in global business. [Level 4: Analysis]
Identify and interpret macroeconomic data. [Level 2:
Comprehension]
Interpret international economic data. [Level 2: Comprehension]
Recognize the impact of exchange rates on international trade. [Level
4: Analysis]
Evaluate macroeconomic policy and its effects on the firm. [Level 4:
Analysis]
Demonstrate an understanding of competitive advantage. [Level 2:
Comprehension]
Evaluate the current international economic position of the U.S.
[Level 4: Analysis]
Evaluate data on the balance of payments. [Level 4: Analysis]
COURSE REQUIREMENTS: The work done for this class must be done by the
student alone, except when teams are explicitly assigned to perform a task together.
Generally, each student will have a different set of homework problems to perform.
SENDING ASSIGNMENTS PAPERLESSLY
Since an important goal of this course is to achieve paperless communication, you
will need to have access to an e-mail address (please send it to me as soon as possible to
my e-mail address) and will need to send your assignments in Microsoft Word (2000),
Microsoft Power Point, and/or Microsoft Excel..
The assignments can be turned in (sent to my WEBCT) anytime during the week.
Please send all assignments to me via WEBCT (see the Login procedure in
appendix I below) . If you send emails to my e-mail account above you will not receive
notification that it has arrived, it will be considered late (loss of one letter grade) and
they must be labeled AS SHOWN IN THE TEXTBOX below if they are to be
accepted at all- otherwise I simply won’t be able to find them.
FOR THE PURPOSES OF DEVELOPING A PORTFOLIO TO WHICH YOU WILL
HAVE ACCESS AT THE END OF THE COURSE, PLEASE SUBMIT YOUR
ASSIGNMENTS AS FOLLOWS:
 Please name the subject line any e-mail with your included assignment or with any
communications on the assignments as "EXI06SLastnameASSNi". Where "Lastname"
should be replaced with your last name. Where "i" should be replaced with the number
of the assignment that is being turned in. My e-mails are grouped by subject and without
that name your email will not be found.
 Please also name the files you send as "EXI06SLastnameASSNi"
 If you are allowed to resubmit an assignment then label it as
"EXI06SLastnameASSNiresubmitj" where “i” is the assignment and “j” indicates the
number of resubmission. However, assignments may not be resubmitted without specific
permission of the instructor. If you do not include “resubmit” at the end of your title and
file name it will simply out the previous assignment without being graded AND WILL
APPEAR TO BE LATE BECAUSE OF THE LATER DATE ON THE RESUBMITTED
FILE
 Always name BOTH the subject line of your e-mail AND the file with
the same name.
By following these instructions carefully I will be able to preserve the files you send me in a
portfolio which will help me to write a recommendation for you anytime in the future. It
will also allow you in the future to request copies from me of what you have done in the
class.
Please allow at least a week for your finished assignments to be graded. Graded
assignments will generally be sent to your WebCT account, and the Wall Street Journal
will be available through your Rockhurst e-mail account. Late assignments (i.e. those
sent to me by normal e-mail or those sent after the deadline) will be graded and turned
back at the end of the semester.
GRADES:
There are ***14*** sections to the course which are taken in order since
they build cumulatively upon each other. Each assignment that covers these sections
must be passed with a 70% score or better on the assignments you receive each week.
Attendance at the lectures and the on-time turning in of assignments are key to the grades
given for the assignments. The grade for the course will be a simple average of your
assignment grades.
A if your average is above 90%
B+ if your average is above 85%
B if all assignments and final exam are above70%
C if any of the assignments or the final is below 70%.
In some cases the professor will ask you to resubmit an assignment. In such cases
the maximum possible grade is “89%”. Only if you are asked to resubmit will the
professor necessarily regrade the homework. If you want to resubmit an assignment, first
talk to (or e-mail) the professor to get permission. Since the answers to the assignment
may already be available, it may be necessary for the professor to respecify the
assignment. Whenever an assignment is redone it will regraded in its entirety.
Meeting Dates and Times
The numbers refer to chapters in the Wild textbook.
Class #1Globalization of Markets and Market boundaries
Reading: Wild chp. 1
Focus: the definition of market boundaries and what makes them expand. Specific case study of the auto
industry is used for the purpose. Geographic Inventories will be explained.
Activity. Recognizing evidence in the Wall Street Journal of the internationalization and globalization of
markets, standardization of business practices, and role of world government. Map exercise (the students
locate the important nations of the world and contrast that with the major trading patterns in the world).
Class #2 Cross-Cultural Business.
Reading: Wild chp. 2
Focus: What is culture? International Culture is contrasted with Corporate culture.
#
1
Date
Friday – 1/6/06
Subject
Readings
#1Globalization of Markets and Market
1
boundaries. For ibn Fadlan article goto
Due
www.uib.no/jais/v003/montgo1.pdf
Movies referred to include:
 The 13th Warrior. Banderas
 Alexander Nevsky.
Eisenstein
2
Saturday – 1/14/06
3
4
5
Friday – 1/20/06
Saturday – 1/28/06
Friday – 2/3/06
6
7
8
Saturday – 2/11/06
Friday – 2/17/06
Saturday – 2/25/06
9
10
Friday – 3/3/06
Saturday – 3/18/06
#2 Cross-Cultural Business.
Market Boundary reference
& power point lecture.
#3 Art tour
#4 Law of one price
#5 Comparative Advantage,
specialization, and the free
market.
2, handout
3-4(to 136) #1
4,9(see below)
5,16
#2
#6 Business-government trade relations
6, Handout
#7 Trends of Govt. Integration.
6,7
#3
#8 World Banking
Handout,
pp378-382
#9 Burden of the debt and bankruptcy
pp. 299-308 #4
11, 12 and
#10 Competitive Strategy
handout.
13
Friday – 3/24/06
Saturday – 4/1/06
DeRigne – MG7000
Friday – 4/7/06
14
Saturday – 4/22/06
15
Friday – 4/28/06
11
12
#11 Forecasting Markets
handout
#12 Selecting and Managing
Entry Modes
#13 Developing and Marketing
Products
#14 The Multiplier and the
interconnectedness of the world
population and the spread of
culture through trade.
13
14,15
handout
#5
#6
Activity: Short segment of the History Channel Movie, “Celtics”- which focuses on the attempt of Celtic
peoples to maintain their language as a source of cultural identity. Students then try to define what culture
is (group activity). Then we ask how culture can change the balance sheet and income statement of a
company (specifically, what happens with nationalization, what happens with cultural activities that are
illegal in the U.S.)
Class #3 Art tour (see attached)
Reading: Chap 3, chap 4 (thru p. 136) and excerpts of Plato’s Republic (outlining the four types of
government that the book describes briefly), Federalist papers (issue of “openness,” confrontation, and
checks-and-balances as keys to democracy)
Focus: Describe the historical development of the law and property and trace the movement from the tribe,
to the agricultural village, the city-state, the theocracy, the nation, and world government.
Activity: By looking at the art, recognizing cultural differences, students see how the art reflects different
types of government- monarchic, oligarchic, democratic. They also see how cultures impact each other
and synthesize each other’s influence. Students are tested on the seven religions presented and described in
the book to see if the art reflects the differences between religions. The students will find that it does. They
also recognize the book’s emphasis on individual vs. collectivism, power distance, uncertainty avoidance,
and achievement (competition).
Class #4 Law of one price and the standardization of culture through market forces
Reading: Wild rest of chapter 4, chp. 9, 286-297, excerpts of O’Neill- the mistake in announcing lack of
support for the dollar and the China exchange rate undervaluation problem
Focus: How do their firms hedge against exchange risk.
Activity. Learn to maximize value by investing different economies. Learn to convert from one currencies
to another. Learn how to arbitrage with currencies.
Class #5 Comparative Advantage, specialization, and the free
market.
Reading: Wild chp. 5, 16. Also excerpts from
*
Adam Smith- needle factory analogy
*
O’Neill-protectionism of the steel industry
*
Tiebout-voting with our feet.
Focus: How do their firms benefit or lose due to foreign competition, outsourcing, and other forms of
globalization.
Activity. Proving why specialization makes everyone better off. Caveat: immobility of factors of
production. Reading WSJ 3rd section to see how to recognize the law of one price, comparative advantage,
and absolute advantage from daily data of markets.
Class #6 Business-government trade relations.
Reading: Wild chp. 6, and handout on market failures
Focus: The market failures that justify government intervention and the government failures that return the
market to a free market.
Acitivity: Wall Street Journal articles on market failures and government intervention. Discussion of trend
;toward world government.
Class #7 Trends of Govt. Integration.
Reading: Wild chp. 6,7
Focus: World Government vs. Nationalism vs. Regional integration.
Activity: Discussion of trend toward world government., illustration through WSJ exercise. Discussing the
different forms of world government covered in the text and the reason for the expansion of world
government jurisdictions.
Class #8 World Banking
Reading; Class handout, pp. 378-382
Focus: Relationship of their companies to lenders.
Activity. Learn sources of demand for money, instruments of monetary policy. Identify cyclic instability
in banking due to loss of trust. Reading the WSJ to understand information on risk.
Class #9 Burden of the debt and bankruptcy
Reading: Wild 299-308
O’Neill, The Exchange Rate Crisis: China
Focus: The role of debt from household to nation.
Activity. Calculation of the interest burden of the tax cut. Then burden of total debt of U.S.. then
exchange rate burden of payment to foreign governments of interest on the debt. Analogy to
household/credit card debt burden- where it applies, where it doesn’t.
Class #10 Competitive Strategy
Reading: chps. 11, 12 and handout.
Focus: How to plan a strategy to compete
Activity: Students learn to map the vertical and horizontal structure of the market
Class #11 Forecasting Markets
Reading: Handout
Focus: NIPA and international accounts
Activity: Use actual Business Week “Business Outlook” columns to predict the direction of the economy
and impact of international events on the economy
Class #12 Selecting and Managing Entry Modes
Reading : chap. 13
Activity: Given WSJ cases, students analyze desirability of vertical and horizontal integration, internal
growth v. acquisition, location analysis and other instruments of a competitive strategy to formulate a plan
of entry.
Class #13 Developing and Marketing Products
Reading: chp. 14, 15
Focus: The product cycle and the role of advertising. Production and the quality movement
Activity: Analysis of the WSJ and reasoning backward from the marketing in the media about competitive
strategy.
Class #14 The Multiplier and the interconnectedness of the world
population and the spread of culture through trade.
Reading: Six degrees of Separation
Undergrad macro reading
Focus: Case study of Terror.
Activity. Discover how economies are stimulated by disasters and the conditions under which they can be
destroyed by disasters. Description of major surges in world commodity flows as a result of festering
problems. How nations heal.
*Readings and other class materials are shown on the dates they are first assigned in
the second to last column. On those dates the topics are introduced and covered in
class. The readings should be completed by the following lecture. Assignments and
worksheets can be turned in no later than the beginning of class on the date shown
in the right hand column. When numbers appear in blue on the website you can
click them to obtain copies.
Policies
Attendance: Attendance is of great importance. Students who are absent more than
one time, will have their final course grade reduced by at least one full letter. The
only exceptions are made for University-sanctioned events, where I get an email
from the sponsor. Please inform me before any absences so that I can give you
make up assignments or instruction for material missed.
Assignment late policy: Assignments must be turned in at the latest by 8:00 a.m.on the day
(***Friday or Saturday***) indicated in the last column of the above calendar. NO
EXCEPTIONS because answer to the previous week assignment may be provided in the lecture
on the due date, students may be asked to share their assignments on the due date, and
assignments must be graded together in order to be fairly graded for all students.
Professionalism of Assignments: As most of us focus on a career in business
or other professional environment, assignments should be submitted as you would
submit them to a business. All assignments should reflect an air of professionalism that
will be required in your career. Assignments will be lowered by at least one letter grade
if not up to those standards.
Academic Honesty Policy: Students are expected to observe the University's policy on
academic honesty in all aspects of this course. Plagiarism (incorporating excerpts of
published works into documents or presentations without proper attribution of original
authors) and cheating (e.g., reliance upon unauthorized resources including, but not
limited to, professors, professionals and published materials and other students) are
serious breaches of ethics and professionalism in both academic and professional settings,
and as such have serious consequences. Page 236 of the 2002-2004 Rockhurst University
Catalog provides explicit examples of academic dishonesty. Pages 236-237 outline
procedures, penalties and due process accorded students involved in a form of academic
dishonesty.
ADA Statement: RU official policy: “Rockhurst University is committed to providing
reasonable accommodations for students with disabilities. Please contact Sandy Waddell,
Director, Access Office (Massman Hall Room 7, (816) 501-4689,
sandy.waddell@rockhurst.edu) to provide documentation and request accommodations.
If accommodations have already been approved by the Access Office, please
communicate with the instructor of this course regarding these arrangements by the
second week of class in order to coordinate receipt of services.”
APPENDIX I
Designer's Instructions for Students Logging into WebCT
For WebCT Version 4.1
WebCT ID and Password
To login to a WebCT course, two pieces of information are required:

a WebCT ID (or user name), and

a password.
For “first-time-user” students, the WebCT ID is the last 6 digits of the Rockhurst student
ID. The initial WebCT password is the mmdd of the birth date (4 digits required). For
example, if a student's ID is 999999 and the birth date is July 7 then the following
information would be the WebCT ID and initial password:
WebCT ID: 999999
Password: 0707
If a student does not have a birth date entry in the student information system, then the
student must contact the HelpDesk or the WebCT Administrator.
For a student who used WebCT during the previous semester, their password may remain
valid from past use. Their WebCT ID is the last 6 digits of their Rockhurst student ID.
Logging in to WebCT
Once the student has registered for a course and/or has a Rockhurst student ID, follow the
steps below to login to WebCT.
1. Start a web browser (see next section for web browser information) and go to
http://webct.rockhurst.edu/
2. Click the WebCT logo or the Login to WebCT link.>
3. Enter the correct WebCT ID and password; click Log in.
4. During the initial login to WebCT, the student will be prompted to enter a new password.
5. After logging in, the myWebCT page will be displayed. A student may change a
password at any time by clicking the Change Password link and entering a new
password. To access a course, click on the course title listed under Courses. (The
student may have multiple courses that use WebCT, all of the courses appear here on
the myWebCT page.)
WebCT Technical Requirements
Since the student may access WebCT through the internet, the computer used must be able to
connect to the Internet. While most popular web browsers will work, problem may by encountered
if a WebCT-approved browser is not used or if the settings are not appropriately set for WebCT
use. For more information about setting up a web browser for use with WebCT, go to
www.webct.com/tuneup. Follow the instructions given by WebCT to check the browser and
settings.
ALL HOMEWORK SHOULD BE SENT TO ME THROUGH THE WEBCT EMAIL SYSTEM. After doing your assignment in Word or Excel, get into
the WebCT mail system, browse for the assignment, and then click the
button that “attach”es the assignment to your mail message to send it
in. Without this last step I will get mail without your homework.