Multinational Corporations Vocabulary

Flashcards covering the vocabulary and definitions related to multinational corporations (MNCs), foreign direct investment (FDI), and their impacts.

Multinational Corporation

Companies that operate in their home country, as well as in other countries around the world.

Foreign Direct Investment (F.D.I)

One company or country invests in business opportunities in another country.

Horizontal Foreign Direct Investment

Same business and activity copied and pasted into a new location.

Vertical Foreign Direct Investment

A company acquires assets to help with process and distribution.

Pros of a Multinational Company

New opportunities to work and go into foreign markets.

Pros of a Multinational Company

Lower average costs and prices for consumers.

Pros of a Multinational Company

Meets customer expectations.

Pros of a Multinational Company (Impact on developing countries)

Capital and jobs are introduced.

Pros of a Multinational Company (Research & Development)

Can explore new ideas.

Cons of a Multinational Company

More money through monopoly power.

Cons of a Multinational Company (Tax Avoidance)

Setting up in low tax paying countries.

Cons of a Multinational Company (Environmental Damage)

Pollution and use of non-renewable sources.

Cons of a Multinational Company (Sweat Shop)

Low paid workers and harsh working conditions.

Cons of a Multinational Company (Anti-Local)

Dominant presence making it hard for local sellers to thrive.