MNCs and FDI

Question 1

FDI

Answer 1

Foreign direct investment

Question 2

reserves

Answer 2

Amount of something valuable such as oil gas or metal ore

Question 3

Key features of MNCs

Answer 3

• Huge assets; land, building, materials
• High qualified and experienced professionals
• Powerful advertising and marketing capabilities
• Advanced tech
• Highly influential
• Efficent

Question 4

Reasons for the emergence of MNCs and FDI

Answer 4

• Economies of scale (large thus can exploit EOS)
• Access to natural resources (large companies invest overseas)
• Lower cost of transport and communications
• Cheap materials (cheaper in other countries)
• Access to foreign markets

Question 5

Pros/Cons of MNCs and FDI

Answer 5

Pro:
Job creation, investment in infrastructure, developing skills, developing capital, contributing to taxes
Con:
Tax avoidance, environmental damage, moving profit abroad