Dr.

José Matías Delgado University

Global Environment
Miguel Armando Paniagua
Wrap-up working guide – Period 1

Name: __________________________________________________________________________
(You do not have to turn in this activity, but your highly encouraged to finish it. It is intended only as
an ancillary task to help you to get ready for your up-coming test)
The main objective of this document is to help you review the contents covered during this semester’s
first period. Complete each question following the instructions provided in each section. Base your
answers on the discussion that have been held during classes and on the written and multimedia
material used in class.
UNIT 1 – International Trends and its impact at the national level | Strategic decision making
Open-end questions

1. For each of the following statements write a 10 lines text answering what is asked
a. According to Rodrick (2018) “Populism and the economics of globalization” how “left wing
populism” can be defined?
b. According to Rodrick (2018) “Populism and the economics of globalization” how “right-
wing populism” can be defined?
c. According to Rodrick (2018) “Populism and the economics of globalization” populism can
be defined as a market phenomenon. Explain how this market works.
d. According to Rodrick (2018) “Populism and the economics of globalization” How economic
unfairness can be defined?
e. According to Rodrick (2018) “Populism and the economics of globalization” why Donald
Trump being elected as president is a sign of both “right-wing” and “left-wing” populism?
f. According to Rodrick (2018) “Populism and the economics of globalization” is there
something wrong with inequality?

2. Provide a 5 lines summary of the following articles discussed in class. These summaries must include
at least the following elements: (i) Article’s main idea; (ii) description of the situation discussed in
the text; (iii) the international trend depicted in the text; (iv) any present element from PEST analysis;
(v) conclusion, and; (vi) main’s ideas importance to business environment / activity.
a. The Economist. Demographic trends “Marquee for millennials
b. Project Syndicate. Nationalism, Immigration and Economic Success, by Jason Furman
c. Project Syndicate. Dirty Populism, by Janine R. Wedel
d. The Economist. Follow the trendlines.
e. Project Syndicate. Risks of the Global Economy in 2019, by Kenneth Rogoff
f. The Economist. Slow Social.
g. The Economist. Is Google an evil genius?
Multiple choice / TRUE-FALSE questions
The Economist
“Wizz on the up. A Hungarian startup could beat Ryanair at its own low-cost game”

3. What is the political factor that allowed Wizz Air to compete in Western Europe´s market?
a. Hungary’s entry to the European Union
b. Hungary’s exit to the European Union
 Dr. José Matías Delgado University
Global Environment
Miguel Armando Paniagua
Wrap-up working guide – Period 1

c. Eastern Europe’s Leaders are avid to make business with the rest of the world
d. Populism is rising among European Union’s members
4. With your peers discuss and provide an explanation to your answer
5. Why finding cheap labor force is a problem for Ryan Air, but not for Wizz Air?
a. Wages in Europe are amongst the highest in the whole world
b. Labor Markets are different in Ireland than in Hungary
c. Hungary and Ireland are currently presenting a shortage of pilots and stewarding personnel
d. Pilot strikes have undermined Ryanair’s operation
6. With your peers discuss and provide an explanation to your answer
7. What’s Ryanair’s current advantage over Wizz Air?
a. Ireland is a more stable country than Hungary
b. Ireland is not a country ran by a populist leader
c. Ryanair has a longer commercial history
d. Ryanair’s reputation allows it to buy planes more cheaply
8. With your peers discuss and provide an explanation to your answer

Project Syndicate
“Creative Self-Disruption”, by Mohamed A. El-Erian
9. Top-down changes refer to:
a. Changes that arise at the very structure of the system, at macroeconomic level
b. Changes that arise by the mere fact that times goes on
c. Changes that arise from political, economic, financial or regulatory changes
d. A and B are correct
10. With your peers discuss and provide an explanation to your answer
11. What has made possible to market players such as Amazon, Airbnb, Apple, Uber, etc. to subdue or
destroy commercial giants?
a. They have taken advantages of opportunities not seized by their rivals
b. They have rewritten market rules
c. They have understood individual the empowerment caused by the internet
d. They propose radical new business and market plans
12. With your peers discuss and provide an explanation to your answer
13. Consumers now expect more from the product they use
a. It is a new reality
b. This is what entrenched commercial giants have missed out
c. A demand-side factor that is reshaping the market
d. A supply-side factor that is reshaping the market
14. With your peers discuss and provide an explanation to your answer
15. Technological advances are toppling long-standing entry barriers
a. It is a new reality
b. This is what entrenched commercial giants have missed out
c. A demand-side factor that is reshaping the market
d. A supply-side factor that is reshaping the market
16. With your peers discuss and provide an explanation to your answer
 Dr. José Matías Delgado University
Global Environment
Miguel Armando Paniagua
Wrap-up working guide – Period 1

The economist
The incredible shrinking country
17. Japan’s Government has acknowledged the fact that needs immigration to solve its demographics
related issues
a. TRUE. Japan has started an immigration program to lure high skilled workers just as Canada
does.
b. FALSE. Japan’s officials deny any need for increasing immigration to curve Japan’s
population shortage
c. TRUE. Japan recognizes that immigration its needed but its efforts and projected plans don’t
seem to be enough
d. FALSE. Prime Minister Abe does not want any immigration fluxes because citizens do not
like Chinese people on their streets
18. With your peers discuss and provide an explanation to your answer
19. Accepting more migrants is not enough to cope with population shrinking in Japan
a. TRUE. Fertility rate must also increase
b. FALSE. Fetility rate must also decline
c. FALSE. Pensions reforms must be designed
d. TRUE. Government should make it easier for couples to get married
20. With your peers discuss and provide an explanation to your answer
21. A demographic change at the scale of what Japan’s require needs a change in social architecture
a. FALSE. Housing is completely adequate to cope with migrants’ needs
b. TRUE. It has to be easier for woman to enter the labor force
c. TRUE. Urban housing areas must be changed in order to be adequate to migrants’ needs
d. FALSE. Woman have to gain access to politics and financial services
22. With your peers discuss and provide an explanation to your answer
TEDtalks discussions
“Global Population Growth, box by box”, by Hans Rosling:

23. The role of the west world is:

a. To be the foundation of the new world
b. To keep on leading the endeavors to build a better world
c. To buy Volvos, Houses and to travel across the globe
d. To understand that big changes are happening around the world
24. With your peers discuss and provide an explanation to your answer
25. Why we need to invest in reducing child-mortality-rates
a. To prevent population growth to continue rising
b. To improve the productivity of the labor force
c. To reduce the burden imposed over developing countries health systems
d. To allow poor countries societies populations to grow
26. With your peers discuss and provide an explanation to your answer
27. Why reducing child-mortality-rates is an important goal to pursue:
a. Governments are morally obliged to keep an eye over their citizens
b. No country can ever grow without taking care of its childhood
c. Improvements in child mortality rates might be a consequence of having stronger institutions
 Dr. José Matías Delgado University
Global Environment
Miguel Armando Paniagua
Wrap-up working guide – Period 1

d. In order to resources to be enough for the whole population

28. With your peers discuss and provide an explanation to your answer
“How China is Changing the Future of Shopping”, by Angela Wang
29. Consumption patterns in China are changing because:
a. China’s middle class has grown more than ever
b. Technology is playing an ever higher role in buying transactions
c. Consumers are becoming more and more impatient
d. China has opened to the world and entered international trade
30. With your peers discuss and provide an explanation to your answer
31. Purchasing power in China has increased because.
a. China’s middle class has grown more than ever
b. Technology is playing an ever higher role in buying transactions
c. Consumers are becoming more and more impatient
d. China has opened to the world and entered international trade
32. With your peers discuss and provide an explanation to your answer
33. How demographics has played a role in China’s consumptions patterns change?
a. China’s middle class has grown more than ever
b. Technology is playing an ever higher role in buying transactions
c. Consumers are becoming more and more impatient
d. China has opened to the world and entered international trade
34. With your peers discuss and provide an explanation to your answer

UNIT 2 – Measuring Economic Activity

Open-end questions
35. For each of the following questions write a 5 lines text answering what is asked. Base your answers
on the discussions held in class and the contents of articles read during this unit.
a. What’s the definition of GDP and what GDP is used for?
b. Why GDP per capita is considered to be a proxy of wellbeing?
c. Why it is stated that GDP is an imperfect measure?
d. Why economist keep on using GDP even when they know is imperfect?
e. Why it is said that increases in exchange rate are good for exporters but bad for importers?
f. How can inflation be defined? What are the tree types of inflation discussed in class?
g. Why the Big Mac Index provides a good measure to compare purchasing power across
countries?
h. Is there a difference between focusing in the quantity of GDP growth rather than it is quality?
i. What’s the underlying assumption (and its drawback) of fixing prices and economic activities
(when measuring GDP), and of fixing a basket of goods and quantities consumed, when
computing CPI?
Comments
36. Miguel arrives excited at his house announcing to his family that his salary will increase 5.5% next
year. His parents are very happy and plan to celebrate. His girlfriend, however, who is a very practical
 Dr. José Matías Delgado University
Global Environment
Miguel Armando Paniagua
Wrap-up working guide – Period 1

economist does not share Miguel’s joy, as she thinks that Miguel has been blinded by happiness and
has not taken other elements into account. Is she right for being so skeptical?

37. Erika and Andrea have been chosen to be part of a Scholarship program. Both have been accepted by
two different universities, each in a different country. However, by the sponsor's provisions, both
must attend the same educational institution. Both options are equally attractive from an academic
point of view, so the quality of life in each nation would be their criterion to decide which country to
go. Erika proposes that they should select the place where GDP per capita is higher. What advice
would you give them?

38. We are in January and your boss is very happy because he considers that the investment that was
made in advertising during last year finally paid off, since in December sales grew 20% in comparison
to the previous month (November). He is so satisfied that he shares his idea of allocating even more
budget to the marketing department in the current year. You are in a state of shock at such a decision.
What element has not been analyzed by your boss? How should December’s sales performance be
assessed?

39. The news channel announces that the prices of the economy have dropped 3%. However, your parents
do not share such a position. The news shows figures of how in general terms, prices are lower. His
parents still do not believe such a statement. Is it possible that both parties are right?

40. Samuel argues intensively with Maura regarding the economic performance of El Salvador form last
year. He thinks that is a great joy that GDP had grown 5.5 %. However, Maura is not very excited.
She thinks that there are many elements that Samuel has not taken into account. Does Maura have
any reason to think like that?

41. A newspaper headline says: “Population has grown 10 % since last year”. Veronica feels terribly
about that and she forecasts a pessimistic future. She says to herself “with so many more people, soon
we will not have sufficient food for everyone” What do you think about Veronica’s conclusion?

42. Yolanda will be hired by a foreign company. She is very happy, given the fact that compared to her
current salary, the one offered by the foreign company will be 30% higher. Monica, a professional
who is very interested in economic indicators warns Yolanda that she must take her decision more
wisely. Yolanda replies that the place where she would go to is a country with great stability in its
market. However, Monica urges her to consider more things before deciding whether to accept the
new job or not.

43. The Prime Minister of a very distant country is very happy because his country reported a 5% increase
in its GDP with respect to last year. You have coursed GLE 0 and you read about this. A person asks
you to help her to interpret this result. Is it good or is it bad?

44. Bessy and Kenya are getting ready for their GLE 0 final assignment. Part of their task is to compare
the economy from many countries. They notice that Guatemala has grown, on average, 3.3% in the
last five years. For its part Belize has grown to 5.5%, on average, in the same period. Which economy
is bigger?
Dr. José Matías Delgado University
Global Environment
Miguel Armando Paniagua
Wrap-up working guide – Period 1

GDP computation exercises

Take Y1 as the base year. For each table compute:

 GDP (nominal and real),

 GDP growth (nominal and real) and
 GDP deflator for every year but the first. Then,
 Use the population fact to provide an opinion regarding which years appears to be the one
where this country’s citizens where better off.
o As for this last point, use GDP numbers as expressed in millions of dollars

Y1 (pop: 7.8 millions) Y2 (pop: 8.3 millions) Y3 (pop: 10.3 millions)

Goods
$ Q $ Q $ Q
Cars 5,000 1,000 5,100 999 4,900 1005
Houses 30,000 100 33,000 85 20,000 70
Meat 3.5 550,000 3.25 600,000 4.25 1,000,000

Y1 (pop: 8 millions) Y2 (pop: 8.5 millions) Y3 (pop: 11.4 millions)

Goods
$ Q $ Q $ Q
Planes 10,000 75 15,000 50 13,000 65
Laptops 500 25,000 600 23,000 550 24,000
Soda 1 1,000,000 1.25 900,000 1.75 800,000

Y1 (pop: 5 millions) Y2 (pop: 6 millions) Y3 (pop: 6.7 millions)

Goods
$ Q $ Q $ Q
Tablets 100 5,000 105 4,500 110 4,000
Bikes 50 30,000 45 45,000 40 60,000
Pop Corn 0.5 2,0000,0000 0.25 5,000,000 0.15 10,000,000