1. China has the most comparative advantages in producing apparel. Free trade theory implies that retailers should import clothing from the most efficient country. Given this, and the potential drawbacks of regional integration, would it be better to allow free trade to take its natural course? That is, should DR-CAFTA be rescinded and apparel retailers allowed to import from the most cost-effective suppliers, wherever they are located worldwide?
2. What are the advantages and disadvantages of DR-CAFTA to Honduran firms? To Honduras as a nation? Should free trade be extended throughout Latin America via the proposed Free Trade Area of the Americas (FTAA)?
3. Honduras is a poor country that faces job losses in its apparel sector from growing foreign competition. What can the Honduran Government do to help keep jobs in Honduras? Should the government try to attract more foreign investment into Honduras? What steps could the government take to attract more FDI?
4. Russell Brands is smaller than Adidas and Nike. What should Russell do to counter these firms? What should Russell do to counter the flood of low-cost athletic apparel now entering the United States from China? What can Russell do to ensure its future survival and success?
