East Asian Trading Ships
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1 EAST ASIAN TRADING SHIPS East Asian Trading Ships BTheme Tami Kaiser-Poge Cary Academy PURPOSE Each student wi work with a partner as an owner of an overseas shipping company with one cargo ship in East Asia. Student objectives are: to know the ocation of East Asian countries and capitas to understand the importance of trade in this area of the word and the interdependence of the goba market to understand the ocation of the important natura resources and the effect that these resources have on the economies of countries in East Asia to anayze import and export charts to use cost benefit anaysis strategies to decide which countries to visit and where to conduct trade to determine the sae cost of an item by adding the percentage of profit to the fixed or manufacturing price of an item to fi out a baance sheet each day by adding costs and subtracting this from income to discuss the meaning of suppy and demand SUMMARY Adaptabe Leves Grades 6 - adut Reated Themes PPE, USGC Vaues Team work, industry, achievement Skis Decision making, reading charts/maps Integration Socia studies, math THEME STATEMENT Technoogy, Production, Distribution & Consumption (TPDC): Decisions revoving around exchange and economic poicies, production, distribution, consumption, and technoogy (aong with we-being) are goba in scope. SUGGESTED TIME Two hours and thirty minutes. KEY VOCABULARY & CONCEPTS suppy = the quantity of commodities or services avaiabe in the market, especiay at a given price. demand = a desire for goods or services by those who wish to buy or use them. import = goods brought into a country; one country s imports can be another country s exports. export = goods sent to markets outside of a country. free trade = trade that occurs without much government contro. Newy Industriaized Country (NIC) = a country that is in the stage between being a reativey poor, deveoping nation and a reativey rich, deveoped nation; a NIC is progressing from abor-intensive to high technoogy-intensive industries. goods/commodities = products or items of trade. 55
2 TEACHING EAST ASIA (INDIANA UNIVERSITY) MATERIALS NEEDED handouts with simuation overview and simuation procedures (Student Handouts #1-#2) ist of commodity costs (with average profits by commodity group) (Student Handout #3) import/export chart (with profit percentages for imports) (Student Handout #4) map of East Asia with capita city ocations (see Appendix II) bank strategy sheet for students to write proposed trave routes (Student Handout #5) beginning baance sheet (Day 0) (Student Handout #6) daiy baance sheets (one per group for each day of the simuation) (Student Handout #7) cacuators for each set of partners/group overhead projector for the teacher to show students how to fi out their baance sheets BACKGROUND INFORMATION The teacher shoud read about East Asian trade and carefuy read simuation instructions. INITIATION (Inquiry, Preview, Invovement) Students shoud read background information on East Asian trade. Exceent background readings and video cips are provided by the Southern Center for Internationa Studies (Word in Transition series, in particuar the program on East Asia). By ooking for reevant web sites, students coud aso research economics and recent events in Southeast and East Asia, thereby earning to utiize web search engines to ocate information. DEVELOPMENT (Instruction, Data Coection, Organization) 1. Have students choose a partner and name their trading company. Make sure that each set of partners has a of the necessary handouts and additiona suppies (see materias needed above). 2. Make transparencies of the Day 0 and Day 1 baance sheets so that you can wak students through the steps of the simuation. EXTENSION/ENRICHMENT (Idea Articuation, Ownership, Experimentation) Teachers can make a arge cassroom map and ay it out on the foor. Make sure that students see the compass rose set up in the room. When students conduct trade in another country, they shoud physicay move a mode boat or some other object to that country and estimate the mies between the countries. You may want students to use the scae of mies to cacuate the cost of fue and/or days of trave in the simuation. In this case, it might pay to adjust some of the percentage profits on the imported items to create incentives for students to trave greater distances. The ength of the simuation coud be changed to accommodate cassroom needs (ten days instead of fifteen days) or to be more reaistic as weeks instead of days. ASSESSMENT OF ACHIEVEMENT Competion of this exercise is an ongoing assessment. At the end, students coud aso check each other to make sure they had competed their baance sheets correcty and arrived at an accurate tota. Students shoud turn in a og or map that shows their trade routes. Students coud be quizzed on countries and capitas, or asked about genera patterns of East Asian trade. Students shoud give cear definitions of suppy and demand and be abe to expain how it affects markets. They shoud aso be abe to expain import and export. Which countries seemed more favorabe for trade and why? Which countries were ess favorabe and why? 56
3 EAST ASIAN TRADING SHIPS KEY QUESTIONS What strategies did you use to decide which countries you woud visit in order to trade? Which import or export items seemed to be most in demand? Which ones seemed to be most in suppy? (Generay, these are the items with ower profit margins.) Did this usuay correspond with the items that were cheaper? ALTERNATIVES To save paper, ony make one cass set of the charts and instructions. Try aminating the worksheets or cipping them into casps of foders to protect your cass set. You wi sti need bank baance sheets for each set of partners for each of the days in the simuation. Periodicay announce random events (e.g., storm in certain body of water) and, therefore, any ship currenty traveing in that body of water is deayed by one day. Aternativey, announce a abor strike by dock workers in a certain country and that anyone currenty oading or unoading in that country is deayed by one day. REFERENCES & RECOMMENDED RESOURCES Brown, Christopher L., Project Editor. East Asia in Transition. Atanta: Southern Center for Internationa Studies, Mukai, Gary. U.S.-Japan Reations: The View from Both Sides of the Pacific. Part II. Stanford: Stanford Program on Internationa and Cross-Cutura Education (SPICE),
4 TEACHING EAST ASIA (INDIANA UNIVERSITY) STUDENT HANDOUT #1: Simuation Overview for Students This is a simuation designed to increase your knowedge of East Asian economics and geography. It shoud aso aow you to practice good anaytica and decision-making skis. As an owner and manager of an overseas shipping company with one cargo ship, you must become famiiar with the imports and exports of East Asian countries. In each country, you wi fi the ten cargo hods on your ship with items that you can BUY from the ist of EXPORT GOODS. You wi then ook on the map and pan a route by sea to other capita cities. In the next city, you wi SELL the items from your ship which that country is wiing to IMPORT and then ook for a new items to buy. You wi need to ook on the chart to find the fixed price for each item before you buy it. When you se each item, you wi be abe to add a percentage of the origina price to the origina price, thereby making a profit. Each day, you wi keep a baance sheet of your buying and seing so that you can keep track of your income. You shoud keep your trading strategies secret because the winner of this simuation is the company with the most profits at the end of the simuation period! Materias needed: map of East Asia with the capita cities marked ist of commodity costs (with overview of average profits by commodity group) import/export chart (with profit percentages for imports) strategy sheet with proposed routes beginning baance sheet (Day 0) daiy baance sheets (one for each day of the simuation) 58
5 EAST ASIAN TRADING SHIPS STUDENT HANDOUT #2: Simuation Procedures Be sure that you read these simuation rues and become famiiar with them. 1. Work with a partner and name your shipping company. 2. Read information about East Asian trading. Read a genera introduction to each country and a summary of the recent poitica transition in Hong Kong. 3. Your company presenty owns a ship with ten cargo hods. You wi start the simuation with a $2500 cash bank oan to begin purchasing items. 4. Look at the map. Choose a capita city in which to begin operation and record this on your Strategy Sheet. Make a ist of the cities that you wi trave to next, recording each on your Strategy Sheet. You must visit at east six different countries; there is no maximum imit on the number of countries you may visit. You may return to any country which you have aready visited. 5. Use your beginning baance sheet and your daiy baance sheets (one for each day of the simuation) to record transactions. This first day, use the Beginning Baance Sheet (Day 0) to record how you are spending your $2500 to purchase commodities which your particuar country exports. Look on the ist of commodity costs to cacuate how much you are spending. Have no more than four cargo hods of the same item. NOTE: You may never add cargo hods to your ship. You do not have to fi the entire ship, and you do not have to spend a of the $2500, athough you cannot spend more than this $2500 at the beginning. 6. Take your ship to another city and that wi constitute one day in the simuation. You may ony buy and/or se in the capita cities, and every time that you do, this takes up one day of trave. When you go to the next city, you wi write on a new Daiy Baance Sheet. Everything that was on your ship in the previous city is sti there, so rewrite these commodities on the income side (eft side) of a new baance sheet. If that new city wi import your item, you can ook for the percentage profit on the import chart and add the profit to the fixed price to get the new sae price. Add everything for your day s income. If you do not se an item, it needs to carry over to the purchase side (do not record a price) to show that that particuar cargo hod it sti fu. Empty cargo hods may now be fied with commodities that you woud ike to purchase from the ist of that country s exports. Record the purchase prices on the expenses coumn (right side) of the same baance sheet, and add this up on your baance sheet. Repeat this step, fiing out a baance sheet for each day of trave and for day zero (the day that you spend your $2500 to get started). 7. It is to your advantage to keep your ship as fu as possibe with items that wi make the highest profit. Pan carefuy which items to buy based on your trave route. Have your ship empty after the ast day of trading; on the ast day, you do not need to buy more items! The $2500 that you began the game with is ike a oan that wi be subtracted out of your fina baance at the end; the resuting baance wi determine your company s profit at the end of the game. You may NEVER acquire additiona ships or cargo hods during the game. 8. REMEMBER: In any given country, you can ony buy what the country is exporting or se what the country is importing! Good uck! 59
6 TEACHING EAST ASIA (INDIANA UNIVERSITY) STUDENT HANDOUT #3: List of Commodity Costs The foowing is a ist of fixed buying prices of commodities per cargo hod: COMMODITY COST (per cargo hod) Fues (incuding coa)... $100 Food (agricutura & fish products)... $100 Texties (fabric, cothing & footwear)... $200 Stee... $200 Raw materias (rubber, timber, etc.)... $200 Consumer goods... $300 Mineras & metas... $300 Oi products & petroeum... $300 Chemicas (incuding fertiizers)... $400 Light Manufacturing... $400 Heavy manufacturing (arge equip./autos)... $500 Eectronics... $500 Beow is a ist of average profits of commodities per cargo hod (pease see import/export chart for exact profit percentages): COMMODITY AVERAGE PROFITS Food, texties, ight manufacturing... 10% Oi, consumer goods, fues, raw materias, mineras... 20% Heavy manufacturing, chemicas, stee, eectronics... 30% 60
7 EAST ASIAN TRADING SHIPS STUDENT HANDOUT #4: Imports/Exports Charts with Import Profit Percentages COUNTRY EXPORTS IMPORTS PROFITS (ON IMPORTS) Brunei oi products heavy manufacturing 30% fues food 10% raw materias chemicas 30% texties 10% Cambodia food consumer goods 20% raw materias oi products 20% mineras heavy manufacturing 30% stee texties 10% China texties stee 30% consumer goods heavy manufacturing 25% ight manufacturing oi 25% fues eectronics 35% Hong Kong texties food 15% ight manufacturing heavy manufacturing 40% consumer goods oi products 25% eectronics raw materias 20% Indonesia ight manufacturing heavy manufacturing 30% fues consumer goods 20% food eectronics 30% raw materias mineras 25% texties Japan heavy manufacturing ight manufacturing 10% eectronics fues 20% texties food 15% chemicas raw materias 20% Laos food fue 20% mineras oi 20% texties consumer goods 20% raw materias ight manufacturing 15% Maaysia raw materias heavy manufacturing 30% eectronics chemicas 30% oi food 15% texties mineras 20% ight manufacturing 61
8 TEACHING EAST ASIA (INDIANA UNIVERSITY) STUDENT HANDOUT #4 (CONT.): COUNTRY EXPORTS IMPORTS PROFITS Myanmar food heavy manufacturing 30% consumer goods chemicas 30% texties ight manufacturing 10% mineras stee 25% North Korea mineras oi 20% texties fue 25% ight manufacturing heavy manufacturing 25% chemicas consumer goods 20% food 15% Phiippines chemicas raw materias 20% eectronics oi 20% consumer goods heavy manufacturing 35% food ight manufacturing 10% mineras Singapore oi heavy manufacturing 30% eectronics food 15% consumer goods chemicas 30% ight manufacturing mineras 25% texties 15% South Korea eectronics food 15% ight manufacturing oi 20% stee chemicas 30% heavy manufacturing mineras 20% texties Taiwan mineras heavy manufacturing 30% eectronics chemicas 25% texties stee 25% food oi 20% consumer goods Thaiand ight manufacturing consumer goods 20% heavy manufacturing raw materias 20% food chemicas 35% texties mineras 25% eectronics Vietnam food oi 20% consumer goods stee 35% fue chemicas 30% mineras raw materias 15% texties 62 (ON IMPORTS)
9 EAST ASIAN TRADING SHIPS STUDENT HANDOUT #5: Strategy Sheet: Trave Itinerary COMPANY NAME EMPLOYEES NAMES (your names) DAY CITY & COUNTRY
10 TEACHING EAST ASIA (INDIANA UNIVERSITY) STUDENT HANDOUT #6: Beginning Baance Sheet Company: Empoyees: REMINDER: Items that you are buying must be exports of the country where you now are. Day: 0 (first day) City: Country: CARGO ITEM PROFIT HOLD (4 or ess of same item) SELL PRICE CARGO ITEM FIXED HOLD (4 or ess of same item) BUY PRICE TODAY S INCOME (add saes coumn) TODAY S EXPENSES (add purchase coumn) Beginning Baance: $ 2500 Today s Expenses: $ New Baance (money eft): $ 64
11 EAST ASIAN TRADING SHIPS STUDENT HANDOUT #7: Daiy Baance Sheet Company: Empoyees: REMINDER: Items that you are buying must be exports of the country where you now are, and items that you are seing must be imports of that country. Day: City: Country: CARGO ITEM PROFIT HOLD (4 or ess of same item) SELL PRICE CARGO ITEM FIXED HOLD (4 or ess of same item) BUY PRICE TODAY S INCOME (add saes coumn) TODAY S EXPENSES (add purchase coumn) Previous Day s Baance: $ Today s Baance (income minus expenses): $ New Baance (indicate profit [+] or oss [-]): $ 65
12 TEACHING EAST ASIA (INDIANA UNIVERSITY) 66
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