Business and the International Company

Question 1

Globalisation

Answer 1

The term now widely used to describe increase in worldwide trade and movement of people and capital between countries

Question 2

Multinational company

Answer 2

Business with factories, production or services operation in more than one country

Question 3

Benefit to a business of becoming a multinational company

Answer 3

• can sell to foreign markets , potential sales
• open factories in a different countries, cheaper
• import materials - higher quality materials
• move products to shops so they can sell in their ‘home country’
• avoid barriers set up by the government

Question 4

Impacts on the countries economy when going multinational

Answer 4

Jobs are created
Increased exports
Decreased imports

However..
Jobs are usually unskilled assembly lines
Reduced sales of local businesses
May have more influence on the government as they are very large
Multinationals usually use scarce and non environmental friendly resources
Profits can be send back to “home” country