QUESTION 2 For this question, you will take in consideration the hypothetical case on assessing the viability of Toyota expanding its foreign direct investment in Princeton, Indiana [USA]. Using the framework discussed in lecture, outline the four major determinants of FDI in context of Toyotas expanding its investment in Indiana. For example, what marketing factors should be considered for this foreign direct investment? In this question, incorporate your knowledge of the articles, Distance Still Matters, and BMW in South Carolina to supplement the FDI framework. For example, based on your knowledge of the BMW investment in South Carolina, what could Toyota leverage to get more government incentives from the decision-makers in Indiana? "You are a member of a consulting firm, The Guild, working with Toyota, a leading Japanese firm, to debate whether to make an additional foreign direct investment, a plant renovation and expansion project, at Toyotas current manufacturing site in Princeton, Indiana. The top management of Toyota are currently interested in a significant plant expansion and re-tooling of its current facilities in Princeton, Indiana. As part of the consulting team for The Guild, you have been assigned the task of looking into the feasibility of expanding the foreign direct investment in Indiana to manufacture autos. The major assumptions of this foreign direct investment: The plant expansion in Indiana would cost $803 million. The location of the current plant is in Princeton, Indiana [see map below]. The company plans to sell autos from the new production line to both the domestic market [USA] and export its product on a global basis. The firm would like to start the new production line at the plant by January 2024. An additional 1,400 locals would be hired at the Indiana manufacturing site, there are currently 1,300 workers at the plant that was built in 1998. An array of incentives was negotiated with the state of Indiana in 1998. But, 24 years later (2022), the consultants at The Guild and Toyota top management are back at the negotiation table with various government stakeholders in Indiana. In order to expand its foreign direct investment in Indiana, more government incentives are required. If this cannot be achieved, the firm is willing to explore adding new production lines to other manufacturing sites, such as its plant in Alabama. The firm will be using state of the art technology, such as robotics to manufacture the autos. Currently, Indiana University at Bloomington has leading faculty experts and students working in the field of advanced manufacturing and robotics. The firm will need to educate and train employees to work with the new line. The current unemployment rate in Princeton, Indiana is 3.4%. The most prestigious university near Princeton, Indiana is Indiana University at Bloomington (99 miles from the plant). The closest community college, Ivy Tech Community College is in Princeton, Indiana. Other community colleges are in other states: Illinois Easter Community Colleges in Mount Caramel, Illinois (12 miles from the plant) and Henderson Community College in Henderson, Kentucky (38 miles). Some auto parts will be manufactured in Japan and imported into the USA for final assembly at the new plant. But, other suppliers should relocate to Princeton, Indiana as part of the supply chain needed for the new production line." 2a. Using the outline discussed in lecture, Major Determinants of FDI, and in context of producing autos in Princeton, Indiana, provide an overview of the critical issues Toyota must address to better understand the key issues related to making a significant foreign direct investment in Indiana to improve its manufacturing facilities. For example, one of the major determinants is marketing factors what key areas should be addressed here? [Note: Make sure that you address ALL of the major determinants of FDI in this question] 2b. Given your knowledge of the article, Distance Still Matters please outline the CAGE framework presented in this case. Specifically, from the perspective of Japanese investors collaborating with both managers and factors workers in the USA -- what would be major implications of CAGE in this investment scenario? 2c. Given you knowledge of investment incentives, what would you negotiate for in terms of a plant expansion with various stakeholders in Indiana? Please give specific details of incentives. Use the concept of the multiplier effect to justify the government incentives. Be creative with this question.