Multinationals Flashcards
1
Q
What is a multinational?
A
A multinational is a business that has operations in more than one country.
2
Q
Advantages of multinationals
A
Wages and raw materials costs are lower in host countries.
Business can avoid legislation in the home country.
Grants can be issued by governments to locate in their country.
Business can avoid quotas and tariffs issued by their own governments.
3
Q
Disadvantages of multinationals
A
Language barriers can slow down communication.
Cultural differences can affect production e.g. siestas in Spain.
Exchange rates can affect purchasing and paying expenses in different countries.
Time differences can hinder communication between head office and branches around the world.
