Week 3: Organizations: Multinational Enterprises (MNEs) (all articles/videos)

Question 1

Which of the following is NOT an advantage of being a Multinational Corporation?

a) Employment
b) Innovation
c) Public relations
d) Efficiency

Answer 1

C

Question 2

A regional multinational corporation is which of the following:

a) The parent company works in the home country and puts up subsidiaries in various countries
b) Has the headquarters in one country while supervising offices in other countries
c) Has only a parent company and no connections with other countries
d) Companies have an executive headquarters in their home country and have facilities in other countries

Answer 2

B

Question 3

Which is NOT a reason for being a multinational corporation?

a) Access to lower production costs
b) Increased legal complexity
c) Avoidance of tariffs
d) Proximity to target international market

Answer 3

B

Question 4

Which of these is a model of a MNC?
a) International
b) Decentralized
c) Global
d) Centralized

Answer 4

D

Question 5

Which of the companies listed below is NOT a multinational corporation?
a) ExxonMobil
b) Dollarama
c) Apple
d) Tesla

Answer 5

B

Question 6

Which of the following is not a motivation for why companies want to become multinational corporations?
a) Access to a larger talent pool
b) Gaining access to lower production costs
c) Proximity to target international markets
d) Higher tariffs and quotas

Answer 6

D

Question 7

Which of the following correctly states the three models of multinational corporations?

a) Centralized, Multinational, International
b) Centralized, Global, Multinational
c) Transnational, Regional, Global
d) Centralized, Regional, Multinational

Answer 7

D

Question 8

Which of the following MCN models is characterized by a company having an executive headquarter that directly manages the offices and facilities in other countries?

a) Centralized Model
b) Regional Model
c) International Model
d) Multinational Model

Answer 8

A

Question 9

Which of the following is an advantage of becoming a multinational corporation?

a) Facing fewer legal complexity across countries
b) Increased tax compliance
c) Access to cheaper labour and raw materials
d) Limited access to global markets

Answer 9

C

Question 10

Which of the following is not a drawback of becoming a multinational?

a) Increased tax compliance in new jurisdictions
b) Access to new markets and resources
c) Political instability
d) Increased legal burden

Answer 10

B

Question 11

Which of the following is the best definition of foreign direct investment (FDI)?

a) Investing in a foreign business to gain direct control or influence on operations
b) Purchasing international portfolio to gain equity
c) Selling goods or services to another country
d) Exporting goods and services from one country to another

Answer 11

A

Question 12

What is a defining characteristic of a multinational corporation (MNC)?

a) It only exports products to other countries.
b) It has actual business operations and makes foreign direct investments in multiple countries.
c) It only sells products online.
d) It operates solely within its home country.

Answer 12

b

Question 13

Which of the following is NOT a reason for a company to become a multinational corporation?

a) Access to lower production costs
b) Proximity to target international markets
c) Avoidance of all legal responsibilities
d) Access to a larger talent pool

Answer 13

C

Question 14

In which model do subsidiaries and affiliates operate with more independence?

a) Centralized Model
b) Regional Model
c) Multinational Model
d) Cooperative Model

Answer 14

C

Question 15

What is one disadvantage of being a multinational corporation?

a) They always operate in stable countries.
b) They face increased legal complexity.
c) They have no competition.
d) They are not taxed in foreign countries.

Answer 15

B

Question 16

Which of the following models includes a headquarters that manages a collection of regional offices?

a) Centralized Model
b) Multinational Model
c) Regional Model
d) Global Model

Answer 16

C

Question 17

What can lead to negative public relations for an MNC?

a) Hiring local workers
b) Providing better wages than local companies
c) Contributing to local economies
d) Being accused of job outsourcing

Answer 17

D

Question 18

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

Answer 18

B

Question 19

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%

Answer 19

C

Question 20

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

Answer 20

B

Question 21

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%

Answer 21

C

Question 22

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

Answer 22

A

Question 23

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

Answer 23

C

Question 24

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

Answer 24

C

Question 25

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

Answer 25

B

Question 26

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

Answer 26

C

Question 27

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.

Answer 27

D

Question 28

How does Donald Trump address multinational companies?

Answer 28

Lower taxes will draw their cash home, border charges will hobble their cross-border supply chains, and trade deals will be rewritten.

Question 29

How has the share of global profits accounted for by multinationals changed?

Answer 29

It has fallen from 35% a decade ago to 30%

Question 30

How much have the profits of multinationals dropped in the past five years?

Answer 30

Profits have dropped by 25% and returns on capital are at their lowest in two decades.

Question 31

How will the retreat of multinationals affect consumers?

Answer 31

Rising prices, diminishing competition, and slowing innovation.

Question 32

What factors contribute to the decline in the profits of multinationals?

Answer 32

Strong dollar and a low oil price explain the decline.

Question 33

When was the East India Company founded?
a] 1492
b] 1600
c] 1598
d] 1602

Answer 33

B

Question 34

Why did the British want to focus on India instead of the Spice Islands?
a] India was closer to them
b] More land to conquer
c] Military failures in Spice Islands against Dutch
d] They didn’t have ships

Answer 34

C

Question 35

What were The Charter Act and the Indian Act?

a] The Indian Act was an act restricting the power of the East India Company and the Charter Act proclaimed British sovereignty over all territory captured by the East India Company

b] The Indian Act proclaimed British sovereignty over all territory captured by the East India Company and the Charter Act was an act restricting the power of the East India Company

c] The Indian Act and Charter Act were both acts giving the East India Company control over different parts of India

d] The Indian Act proclaimed British sovereignty over all territory captured by the East India Company and The Charter Act was an act creating a charter for British policy in India

Answer 35

A

Question 36

What was the Sepoy Mutiny?

Answer 36

A rebellion against the rule of the company in India

Question 37

What did workers need to do in the beginning of their company tenure (until the end of the 18th century)?

a] Volunteer work
b] Volunteer work and paying a bond
c] Unpaid internship
d] Unpaid internship and paying a bond

Answer 37

D

Question 38

Director salaries were nothing to write home about, but they brought in a lot of money in general. Why was this?

a] They went door to door robbing people
b] They did not pay their workers
c] People would give both gifts and cash for the hope of a nomination or a trade deal
d] Directors were appointed through connections, and these connections often secured funds from high-up government members which the directors pocketed

Answer 38

C

Question 39

Why did the company allow set leave for employees?
a] They were really nice
b] They wanted to make sure their workers didn’t leave
c] For religious purposes
d] In response to complaints to cutting down holidays that workers got

Answer 39

D