_Chapter 1
THE INTERNATIONAL ECONOMY AND GLOBALIZATION
CHAPTER OVERVIEW
This chapter introduces students to the international economy and to globalization. The first part of the
chapter emphasizes the high degree of economic interdependence that characterizes today s economies.
Economic interdependence includes international trade and international finance.
1. Investment decisions: Should a new computer be purchased? Should the firm develop a new drug?· Should the firm shut down an unprofitable factory? Financing decisions: Should the firm borrow money from a bank or sell bonds?· Should the firm issue preferred stock or common stock?· Should the firm buy or lease newmachine that it is committed to acquiring?
22. What should we do with tomatoes to get the best taste? A. Put them in the cooler. B. Cook them at once C. Make them ripen faster. D. Leave them in the shade. 23. What will go bad easily without refrigeration? A. Dressed salad. B. Mayo and yogurt. C. Oil and vinegar. D. Salad dressings.