TNC's

Question 1

positive impacts of TNC’s

Answer 1

-raised living standards
-technology transfer
-political stability (due to economic growth)
-higher environmental standards (bring good practice to countries that dont have good env protection)

Question 2

negative impacts of TNC’s

Answer 2

-tax avoidance (pay lowest tax as possible)
-growing global inequalities (tend to cluster in selected economies)
-Unemployment (outsourcing and offshoring)
-environmental degradation (can export the negative impacts where they operate to)

Question 3

Glocalisation

Answer 3

changing the design of products to meet local tastes or laws in order to sell as much as possible

Question 4

Why do businesses use glocalisation

Answer 4

-religion and culture
-laws
-local interest

Question 5

Example of glocalisation

Answer 5

2012, mcdonalds had 35,000 restaurants in 119 diff countries including Mcspicy paneer

Question 6

Physical factors why a country is detached

Answer 6

-distance from market
-low agriculteral potential
-lack of energy

Question 7

economic factors why a country is detached

Answer 7

-high government debt
-poor transport and telocommunication infrastructure
-vunerable commodity cycle (boom and bust)

Question 8

Political factors why a country is detached

Answer 8

-Exclusion from trade blocs
-weak commitment of gov to development
-corruption and conflict

Question 9

Historical factors why a country is detached

Answer 9

-colonial borders
-lack of education- low skills

Question 10

political instability in niger

Answer 10

-frequent coups and unrest (4 coups since 1960)
-suspension of international aid after 2023

Question 11

Economic underdevelopment in niger

Answer 11

-limited infrastructure
-dependance on agriculture
-poverty rate (40%)

Question 12

Geopolitical

Answer 12

the way a country’s size, position, etc. influence its power and its relationships with other countries

Question 13

Geopolitical challenges in niger

Answer 13

-landlocked in sahal region
-transport costs (being landlocked adds around 50% to the cost of imports)
-regional conflict (in sahal conflict zone w boko haram terrorist groups)
-literacy rate (only 35% of above 15 yr olds is literate, reduce workforce potential)

Question 14

Dependance of aid in niger

Answer 14

-around 40% of nigers budget is funded by foreign aid
-Debt burden (external debt is about 50% of GDP)

Question 15

Environmental challanges in niger

Answer 15

-agriculture (employs 80% but only contributes to 40% of GDP)
-food insecurity (4.4 mill face insecurity in 2023)
-water scarcity (limited industrialisation or large scale farming)

Question 16

Weak governance and corruption in niger

Answer 16

-corrupt gov (discourages FDI, unpredictable business environment)

Question 17

why is North Korea politically switched off/ detached

Answer 17

-due to hereditary autocracy (gov of one person with absolute power)
-propaganda
-emigration prohibited
-60% live in poverty
-juche (self sufficient) ideology

Question 18

How many TNC’s globally

Answer 18

60,000

Question 19

how much % of economic activity do TNC’s account for

Answer 19

25%

Question 20

patent

Answer 20

inventing something and getting rights to it

Question 21

outsourcing

Answer 21

when a TNC chooses to offer a working contract with another foreign company

Question 22

offshoring

Answer 22

when a TNC moves their own production process to other countries to reduce labour or other costs

Question 23

example of offshoring

Answer 23

Dyson moved its manufactoring division to malaysia in 2002

Question 24

Benefit of offshoring

Answer 24

Able to move factories closer to markets they’re serving e.g nissan building factories inside EU to serve europian countries

Question 25

Acquisitions

Answer 25

when two firms in different countries join forces to create single entity, in 2015 a third of all FDI consisted of acquisitions

Question 26

benefit of aquisitions

Answer 26

expanded markets and opportunity to reduce costs due to rationalisation (re-organize to increase efficiency)

Question 27

joint venture

Answer 27

when two companies form a partnership to handle business in particular territory

Question 28

example of joint venture

Answer 28

mcdonalds with local indian business to glocalise

Question 29

benefit of joint venture

Answer 29

reduces risk a TNC is exposed to, make the TNC more sucsessful than either steakholder working alone

Question 30

Benefits of branding

Answer 30

create an imagined global identity- creates loyalty, familiarity, brand name recognised nationally

Question 31

Horizontal integration

Answer 31

when a business merges with another business in the same industry working at the same level

Question 32

Benefit of horizontal integration

Answer 32

helps company grow in size and revenue, reduce competition and diversify product offerings

Question 33

Vertical integration

Answer 33

when firms at different stages of production merge together

Question 34

Benefit of vertical integration

Answer 34

improve operational efficiency, reduce production cost and increase revenue

Question 35

Global production network (GPN)

Answer 35

links that extend nationally involving firms engaged in the production of goods, accounting for 80% of global trade