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BUSINESS ORGANISATION - Coggle Diagram
BUSINESS ORGANISATION
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MULTINATIONALS
- A multinationalcorporation (MNC) or transnational corporation (TNC) is a company that produces goods or services in more than one country and sells them to the worldwide market.
- WHY? Companies often become multinational because size can help them compete against other businesses, leading to lower costs of production, extracting the raw materials nearer the market, to reduce transport costs and moving production in countries with low costs, such as low wages, or to avoid barriers to trade set up by countries to reduce the imports of goods.
- ADVANTAGES:
• Jobs will be created and unemployment reduced.
• New investment in buildings and machinery will increase output of goods and services.
• Imports could be reduced as more goods are now made in the country.
• Taxes paid by the multinational will increase the funds to the local government.
- DISAVANTAGES:
• The jobs created are often unskilled.
• Local companies may be forced out of business.
• Multinationals often use up non-renewable resources.
• Multinationals could have a lot of influence on both the government and the economy of the country.
• Local natural resources are exploited.
• Multinationals can cause pollution
• Workers are exploited (low salaries, bad health and safety condition
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