Topic 2 Multinational Corporations and Business Strategy in a Gl

What is the definition of globalisation?

• A method of increasing local production

• The process by which the world is becoming interconnected

• The process of becoming isolated economically

• A strategy for reducing international trade

Which of the following is a benefit of globalisation?

• Increased isolation of economies

• Higher costs of goods

• Boost in output and innovation

• Decreased competition

What is a Multinational Corporation (MNC)?

• A company that operates in one country

• A small local business

• A large company operating in multiple countries

• A government agency

What is one cost of globalisation?

• Increased job opportunities

• Environmental degradation

• Higher wages for all workers

• Improved working conditions

Which type of MNC produces the same products in different countries?

• Conglomerate MNCs

• Horizontally Integrated MNCs

• Local MNCs

• Vertically Integrated MNCs

What is a motive for becoming a multinational corporation?

• To reduce costs

• To avoid competition

• To limit market access

• To decrease production

What is a host state?

• The country where a company is headquartered

• The country with the highest GDP

• The country where a foreign company operates

• The country of origin for a product

Which of the following is NOT an advantage of MNC investment?

• Technology transfer

• Employment opportunities

• Balance of payments

• Increased uncertainty

What is one problem that multinationals may face?

• Improved communication

• Increased market share

• Language barriers

• Lower production costs

What is the objective of vertically integrated MNCs?

• To produce different products

• To diversify risk

• To control different stages of production

• To increase market share