Podcast
Questions and Answers
How do multinational companies (MNCs) achieve low costs in their operations?
How do multinational companies (MNCs) achieve low costs in their operations?
MNCs achieve low costs by accessing lower-cost labor and raw materials by relocating to cheaper areas or exploiting economies of scale.
What potential advantages do MNCs gain from having access to a large customer base?
What potential advantages do MNCs gain from having access to a large customer base?
MNCs can achieve high sales volumes due to their access to a large and diverse customer base.
In what way can being a well-known business contribute to a multinational's success?
In what way can being a well-known business contribute to a multinational's success?
A high profile allows MNCs to increase brand recognition, which aids in achieving market dominance and becoming household names.
How do MNCs navigate trade barriers effectively?
How do MNCs navigate trade barriers effectively?
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What is one tax advantage that MNCs often pursue?
What is one tax advantage that MNCs often pursue?
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Study Notes
Multinational Company (MNC) Advantages
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Lower Costs: MNCs can reduce expenses by sourcing cheaper labor and raw materials in different countries or by benefiting from economies of scale.
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High Sales Potential: MNCs reach a vast customer base, leading to higher sales volumes.
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High Profile and Market Dominance: MNCs often gain recognition, making their products more popular and potentially leading to market control.
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Trade Barrier Avoidance: MNCs can establish operations within trade blocs or countries with import restrictions, circumventing trade barriers.
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Reduced Tax Burden: MNCs can minimize tax obligations by registering in countries like Ireland or Cyprus that have low tax rates, maximizing profits for shareholders.
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Description
Explore the key advantages that multinational companies (MNCs) enjoy in today's global economy. This quiz examines benefits such as cost reduction, high sales potential, and strategies for market dominance. Test your knowledge on how MNCs navigate trade barriers and optimize their tax burdens.
