Hypothesis Testing

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Hypothesis Testing

Robert A. Sandbeck Jr.

University of Phoenix

Research and Evaluation


March 28, 2011

Dean Gualco

Multinational corporations affect industry as well as countries through manufacturing, imports, and exports, to name just a few. The technology that these corporations bring with them is valuable to the host country. The hypothesis discussed concerns the acquisition or development of technology in underdeveloped countries based on cost. The question of whether or not it is cheaper to import technology or develop the technology can be debated but the truth lies in the data of the study.

The fact is that technology is distributed to countries every day through trade and foreign investment. If these, or others avenues did not exist to allow technology to move throughout the world, the underdeveloped countries most likely would not develop, or they would develop at a much slower rate, based on cost of the development. The study shows that the more direct foreign investment, the more a country will develop using the technology that is imported.

The hypothesis of the study was accepted. The study showed that countries that imported technology were more likely to develop than trying to develop the technology on their own at a significantly reduced cost. Assume that the country needs to develop its own technology. That same country would need to invest in the education of its citizens, pay the wages necessary to design, engineer, and develop the technology. If the technology has already been developed the cost for the technology is significantly lower. Because the trend of relying on countries that develop technology by countries that do...