The Issues of Running a Business

Q1
Countries that are presently attractive for U.S. corporations seeking foreign direct investment opportunities include China, India and Africa (Peters, 2011; Gill, Biger, Tibrewala, 2010; Graham, Spalding, 2005). These countries are attractive because of their emerging economies and high population. However, they are not without their attendant risks. Geopolitical risks in China include contentions with the West over the South China seas, relations with North Korea and Russia, and the New Silk Road project. In India, there are risks associated with the political system there as well, especially with regard to the extent to which the current government wants to allow foreign investment. Africa is also geopolitically risky in certain countries, where governments are undergoing destabilization (for instance, in South Africa).
Q2
Yes, GE just got a new CEO—Jeff Immelt stepped down and was replaced by John Flannery. Immelt helped the company divest of its finance industry which almost tanked the company in 2008. Flannery now takes over to help guide GE towards more development of its core engineering business as well as its healthcare business. Flannery has a lot of experience in the firm, overseeing healthcare as well as deal-making in foreign countries. As GE looks to the developing world like the rest of the West, it will require a firm hand to ensure the corporation proceeds successfully. As Wild, Wild and Han (2010) point out, the world of international business is a challenging one that requires a great deal of foresight, forethought and ingenuity to be successful.
Q3
10 straight quarters of declining sales—yes, Macy’s faces much business risk (Brownfield, 2017). Amazon is destroying retail and Macy’s faces the bleak prospect of following in the footsteps of Sears, Circuit City and Best Buy as they all have and had to struggle with the new approach to shopping. Demand volatility for Macy’s is a factor, just as the Internet is changing the way that people look to buy goods and obtain items for themselves.
Q4
Bank of America is a commercial bank and an investment bank. It takes deposits and issues loans and it also sells securities and provides guidance to corporations doing mergers and acquisitions (Callard, 2017). Bank of America does it all and thus is a huge operator in the financial services industry, functioning on many levels to work both with governments and businesses as well as helping individuals obtain loans or open checking accounts.
Q5
Yes, it is higher. Ford’s is 4.528. Amazon’s is 0.3548. That is—according to YCharts, which uses various fundamentals per quarter, from PE ratios to Payout ratios (Fundamental Chart, 2017). True, Amazon’s PE ratio is much higher than Ford’s but AMZN is also one of the premier stocks to own—one of the big drives of the overall stock market, and the one company that is single-handedly challenging the entire retail sector while providing digital services to Internet providers all over the world. Ford on the other hand is struggling to recover from the great economic crisis of 2008 and the automotive industry as a whole looks to be in another bubble, with inventory at all-time highs and incentives barely moving sales.
References
Brownfield, A. (2017). Analyst: Macy’s isn’t worth the risk. BizJournals. Retrieved
from https://www.bizjournals.com/cincinnati/news/2017/08/11/analyst-macys-isnt-worth-the-risk.html
Callard, A. (2017). Banks, firms, and houses. Slate. Retrieved from
http://www.slate.com/articles/news_and_politics/explainer/2008/09/banks_firms_and_houses.html
Fundamental Chart. (2017). YCharts. Retrieved from
https://ycharts.com/companies/AMZN/chart/
Gill, A., Biger, N., & Tibrewala, R. (2010). Understanding and mitigating direct
investment risk in the Indian real estate market. Business and Economics Journal, 2010, 1-10. Retrieved from http://astonjournals.com/manuscripts/Vol2010/BEJ-2_Vol2010.pdf
Graham, P. & Spalding, R. (2005). Understanding foreign direct investment - going
global. Retrieved from http://www.going-global.com/articles/understanding_foreign_direct_investment.htm
Peters, S. (2011). Emerging Africa: The new frontier for global trade. Economics,
Management and Financial Markets, 6(1), 44-56.
Wild, J.J., Wild, K.L., & Han, J.C.Y. (2010). International business: The challenges of
globalization, 5/E (Chapter 7: Foreign Direct Investment). Pearson. Retrieved from http://www.pearsonhighered.com/pearsonhigheredus/educator/product/products_detail.page?isbn=0137153759