Finance 4 Essay Example | Topics and Well Written Essays - 500 words

Finance 4 - Essay Example For the size of the area and the number of consumers, Its more easier to establish a market at the least cost. Not just the consumers, In Japan the well equipped and advanced cheap labour force with valuable expertise helps in controlling the production costs hence by gaining more profits which is practically not possible in the United States of America where the labour cost in enormous. The high Japanese GDP shows the technological and economic standard of the country which surely can attract American industry to set up its business. As the facts can be considered, the Japanese market constitutes to 75% of the entire Asiatic market and thus controls the Asiatic market. The high rate of saving in Japan allows the people in Japan to purchase goods if he likes even at a higher price as he/she will have the financial assets. A well-organized infrastructure in the fields of commodity distribution and information and communication; and a good business environment with improved laws and sy stems is an added advantage for the American companies. The Communication advancements and the connectivity by all the 3 modes such as Air, water and land make Japan a favourite FDI place for Americans. The currency exchange rates tempt America the most for them to invest in Japan, The exchange rate being 108.180 Japanese Yen for one US Dollar according to www.xe.com. The inflation also accounts to -.06% so its more reasonable for the company to produce the products in an economical way. Other than that, the Japanese External Trade Organisation called JETRO assists Individual investor with the meetings, laws who is specialised in the international investments and taxations. JETRO also provides free use of private office for a period of maximum 2 months for private bodies and a maximum of 6 months for public bodies. Japan also provides 30% depreciation rate or a tax credit of 7% up to 20% of the corporate tax liability for the purchase of certain machinery and equipments.