Globalization

1. Low cost and highly productive labor force is one of the key's to Chinese cost advantage over pencil manufacturing. Availability of raw material and low environmental regulations are other two major compensations for the Chinese manufacturers to produce low cost yet enhanced quality pencils. Again low government restrictions, tax and subsidies, cheap transportation cost in many forms, plays important role for such low price.

2. Yes, I think it can be one of the good ways to protect American jobs. Initially, it will benefit the local manufacturers as Chinese suppliers will be reluctant to enter the US market due to high Tariff. But there is a catch; the antidumping tariffs may cause the Chinese to become more competitive in some ways. They have options to diversify their business or invest in a different country where least tariff is imposed by the US government. As a result it will increase pressure on the US's import policy. So it is a highly augmentable topic. The US government can also focus on Import Barriers, Quota, and Customs Barriers etc.

3. Dixon decided to become a multinational company in order to succeed increased competition from international suppliers. Dixon now has the following economical benefits:

o Strong foothold into the international market

o Cheaper labor costs

o Cheaper raw materials and distribution costs

o Taking advantage of the many tax breaks offered by foreign countries and local government.

o Access to new technologies and methods

o Availability of government grants

4. NAFTA agreement gives certain advantages to US manufacturers to do business in Mexico. NAFTA is a trade agreement between USA, MEXICO and Canada