Multinationals

Question 1

An Advantage of Multinationals.

Answer 1

1. Wages and raw materials costs are lower in host countries.
2. Business can avoid legislation in their home country.
3. Grants can be issued by governments to locate in their country.
4. Business can avoid quotas and tariffs issued by thir own govrnments.

Question 2

Describe a multinational organisation.

Answer 2

A business that has operations in more than one country.

Question 3

Disadvantage of multinationals.

Answer 3

1. Language barriers can slow down communication.
2. Cultural Differences can affect production, e.g. ‘siestas’ in Spain.
3. Exchnge rates can affect purchasing and paying expenes in different countries.
4. Time differences can hinder communication btween head office and branches arond the world.