*6 TNC Relationships

Question 1

a major node for international decision-making, finance, specialized/advanced
services, innovation, production, and marketing (as well as a market)

Answer 1

global city

Question 2

the creation of a functionally specialized firm engaged in a single stage
of production (i.e. a firm takes over other firms performing the same function in the production
chain)

Answer 2

Horizontal Integration

Question 3

the creation of a functionally integrated firm engaged in all stages of
production (i.e. a firm takes over all firms that provided its inputs)

Answer 3

vertical integration

Question 4

the creation of a diversified firm engaged in producing different goods
for different markets (i.e. a firms takes over different firms producing different products)

Answer 4

diagonal integration

Question 5

providing finished products (for the principal firm)

Answer 5

commercial subcontracting

Question 6

providing components or processes (for the principal firm)

Answer 6

industrial subcontracting

Question 7

commercial agreements between TNCs, often involving shared
technologies, marketing networks, market research, or product development

Answer 7

strategic alliance

Question 8

the creation of specialized firms as subcontractors within industries
formerly dominated by large, functionally integrated firms

Answer 8

vertical disintegration