tnc production Flashcards
why is economies of scale in terms of tncs beneficial?
TNCs usually have a large revenue, meaning they can afford to upscale their production.
This allows profits to increase as less is spent in production.
how do tncs effect global supply chains?
TNCs use global supply chains in order to increase profits.
HQ and R&D are in HICs, whereas the production often occurs globally, especially with TNCs that
operate within the secondary industry sector
whats an example of a tnc where different components are manufactured in different countries to give the overall best product?
boeing the american aircraft
- highly technical parts produced in the UK
- more basic components produced in china for lower costs
what is outsourcing for tncs?
TNCs that provide tertiary industry products (services) will often outsource tasks to other companies in order to save money and time.
TNCs like Apple outsource their manufacturing process so that profits can be maximised.
whats an example of a tnc thats outsourced?
TNCs like Apple outsource their manufacturing process so that profits can be maximised.
what is offshoring in terms of tncs?
Companies that make manufactured products will often have their factories in LICs
- lower labour costs
- better taxes
- weaker regulations for workers
- weaker environmental regulations
leading to disputes about the ethical issues with TNCs
exploiting poorer citizens in order to maximise their products
