How to determine a location for a manufacturing plant outside the United States?

timer Asked: May 9th, 2018
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Purpose of Assignment

Students examine the long-run determinants of both the level and the growth rate of real GDP per person and the factors that determine the productivity of workers and what governments might do to improve the productivity of their citizens. Students will learn how saving and investment are coordinated by the loanable funds market and will see the effects of taxes and government deficits on saving, investment, the accumulation of capital, and ultimately, the growth rate of output. Students will be introduced to tools that people use when they participate in financial markets. Students will see how people compare different sums of money at different points in time, how they manage risk, and how these concepts combine to help determine the value of a financial asset, such as a share of stock. Students will be introduced to the labor market and how economists measure the performance of the labor market using unemployment statistics. Students will address a number of sources of unemployment and some policies that the government might use to lower certain types of unemployment.

Assignment Steps

Resources: National Bureau of Economic Research

Scenario: The organization's strategic plan calls for an aggressive growth plan, requiring investment in facilities and equipment, growth in productivity, and labor over the next five years. It is your team's task to determine where, outside the United States, your organization should locate its new manufacturing plant.

Write a 1,050-word report recommending an off-shore country and support your choice with the following data:

  • The factors determining the country's productivity
  • How the country's policies influence its productivity growth
  • How the country's financial system is related to key macroeconomic variables
  • How your organization can reduce the risk they would face in relocating
  • The current and projected unemployment over the next five years

Cite a minimum of three peer-reviewed sources not including your textbook.

Format the assignment consistent with APA guidelines.

Click the Assignment Files tab to submit your assignment.

Tutor Answer

School: University of Maryland

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Relocating a Manufacturing Plant from the USA to Mauritius
Author’s Name
Professor’s Name
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Relocating a Manufacturing Plant from the USA to Mauritius
The decision to expand the operations of a manufacturing plant to a country outside of
the USA requires solemn thought and research to ensure that the offshore country offers a
compatible tax scheme among other things. Some companies ventured into this and incurred
losses that eventually forced them to retrace their steps back to the country. This paper evaluates
the factors to be considered while selecting an offshore country, explains the country’s financial
system and growth determinants, as well as unemployment projections over the next five years.
The paper also delves into the details of how the company will mitigate risks involved in the
relocation process.
Productivity Determinants
The National Bureau of Economic Research defines productivity to mean the
effectiveness of efforts to produce products and services measured regarding how much output is
realized per every unit of input (McMillan & Rodrik, 2011). The writers further explain that
input is valued regarding invested labor and capital while the output is revenues realized. One of
the primary determinants of productivity in any country is physical capital, which refers to the
human-made facilities, and infrastructure that supports the operations of a business (McMillan &
Rodrick). This capital includes buildings, machinery, roads, and technology. To this end, the
Ministry of Public Infrastructure and Land Transport in Mauritius, Public Infrastructure
Division, has the mandate to develop roads and other public facilities to facilitate the growth of
businesses in the country. The country hosts major technology companies including Infomil and
Cybernatics that develop innovati...

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