W3P2 (article): In Retreat by The Economist Flashcards
What is one of the primary factors driving global companies to relocate operations back to their home countries?
A) Rising labor costs in home countries
B) Protectionist policies favoring local jobs
C) Decline in home-country consumer demand
D) Increasing global tariffs on exports
B
How much has the share of global profits from multinational corporations (MNCs) decreased over the past decade?
A) From 40% to 30%
B) From 50% to 35%
C) From 35% to 30%
D) From 30% to 25%
C
Which of the following countries has fostered local innovations that are challenging the dominance of multinationals in sectors like e-commerce and telecom?
A) South Korea, Germany, and Japan
B) China, India, and Brazil
C) Mexico, Russia, and Saudi Arabia
D) United States, United Kingdom, and Canada
B
What percentage of multinational companies currently achieve a return on equity of less than 10%, highlighting underperformance?
A) 15%
B) 25%
C) 40%
D) 55%
C
What strategic approach have companies like General Electric and Siemens adopted to mitigate the challenges posed by the changing global landscape?
A) Localising their supply chains and job markets
B) Shifting entirely to intangible services and branding rights
C)Increasing foreign direct investment (FDI) in emerging markets
D) Expanding their physical manufacturing operations globally
A
Which multinational firms have been criticized for low job creation and tax contributions despite their rapid global expansion?
A) Microsoft and Apple
B) IBM and Oracle
C) Uber and Google
D) Facebook and Amazon
C
The “golden age” of multinational corporations is closely associated with which period?
A) 1970s, due to post-war industrial booms
B) 1980s, driven by privatization policies
C) 1990s, following the opening of global markets
D) 2000s, with the rise of digital technologies
C
What risk could arise from the retreat of multinational corporations for countries that are heavily reliant on them?
A) Decline in government tax revenues due to local company dominance
B) Worsening of trade deficits as foreign capital diminishes
C) A rapid increase in labour productivity due to small business expansion
D) Increased foreign aid dependency from developed nations
B
Which of the following is NOT a potential consumer impact of multinational corporations retreating?
A) Higher prices due to reduced competition
B) Slower innovation and product diversity
C) Improved job opportunities at local firms
D) Reduced availability of certain global products
C
In the long term, how might the retreat of global firms affect market dynamics?
A) The rise of small firms will quickly surpass the influence of multinationals.
B) Consumers will likely forget about the role of multinationals in global markets.
C) Governments will reduce regulations on foreign investments, reversing the retreat trend.
D) There may be nostalgia for the benefits provided by global firms as the shift toward smaller firms takes time.
D
