1.6 Multinational Companies (MNCs) Lecture Notes

These flashcards cover key concepts related to Multinational Companies (MNCs) discussed in the lecture notes, focusing on definitions, impacts, reasons for becoming an MNC, and analytical tools.

What is a Multinational Company (MNC)?

An organization that operates in two or more countries.

What is a host country?

Any nation that allows a multinational company to set up operations in its country.

List two positive impacts of MNCs on host countries.

Job creation and higher national income.

List two negative impacts of MNCs on host countries.

Job losses and profits are often sent 'home'.

What are some reasons why businesses become MNCs?

Increased customer base, cheaper production costs, and economies of scale.

What does the acronym SWOT stand for?

Strengths, Weaknesses, Opportunities, Threats.

What is the STEEPLE analysis used for?

To analyze the external environment of a multinational company.

For what reasons did Tesla open its Gigafactory in Shanghai?

To expand its market presence, take advantage of local manufacturing, and reduce shipping costs.

What are the ethical considerations for profitable MNCs?

They may have an ethical obligation to support the poor in society beyond providing employment.

Define globalization in the context of MNCs.

An approach adopted by MNCs to integrate local and international cultures in goods and services consumption.