(10) The importance and growth of multinational companies.

Question 1

How have multinationals developed?

Answer 1

• Through economies of scale
• Effective marketing
• Through technical and financial superiority

Question 2

What are the benefits of becoming a multinational?

Answer 2

• Larger customer base
• Lower cost
• Higher profile
• Avoiding trade barriers
• Lower taxes

Question 3

What are the benefits of multinationals to a country?

Answer 3

• Increase in income and employment
• Increase in tax revenue
• Increase in exports
• Improvement in the quality of human capital.

Question 4

What are the drawbacks of multinationals to a country?

Answer 4

• Environmental damage

- Exploitation of less developed countries