Question 1

Describe and explain how MNCs have grown so quickly in the past 40 years.

Accepted Answer

Multinational corporations (MNCs) have experienced rapid growth over the past 40 years due to a combination of factors. One of the key drivers of this growth has been globalization, which has allowed MNCs to expand their operations into new markets and take advantage of lower production costs in developing countries. This has enabled them to access new sources of labor, raw materials, and consumers, leading to increased profits and market share.

Additionally, advancements in technology have played a significant role in the rapid growth of MNCs. The development of the internet and other communication technologies has made it easier for MNCs to coordinate and manage their global operations, as well as reach customers in different parts of the world. This has also facilitated the outsourcing of various business functions to different countries, further driving the expansion of MNCs.

Furthermore, changes in government policies and regulations have also contributed to the rapid growth of MNCs. Many countries have implemented policies to attract foreign investment and encourage the establishment of MNCs within their borders. This has created more favorable business environments for MNCs, allowing them to expand more quickly and easily.

Finally, MNCs have also grown rapidly due to their ability to adapt to changing consumer preferences and market trends. By diversifying their product offerings and investing in research and development, MNCs have been able to stay competitive and capture new markets.

In conclusion, the rapid growth of MNCs over the past 40 years can be attributed to globalization, technological advancements, favorable government policies, and their ability to adapt to changing market conditions. These factors have allowed MNCs to expand their operations and reach new customers, leading to their rapid growth and success.

Question 2

MNCs started as British creations that first appeared shortly before WW I.

Accepted Answer

A) True 
 B)False  False

Question 3

We expect to find the most amount of MNC activity when

Accepted Answer

A)  locational advantages exist, but there are neither intangible nor specific assets. 
B)  no locational advantages exist, but there are intangible and specific assets. 
C)  no locational advantages exist, and there are neither intangible nor specific assets. 
D)  locational advantages exist, and there are both intangible and specific assets. 
E)  there are vertically integrated intangible assets. 
A)  locational advantages exist, but there are neither intangible nor specific assets. 
B)  no locational advantages exist, but there are intangible and specific assets. 
C)  no locational advantages exist, and there are neither intangible nor specific assets. 
D)  locational advantages exist, and there are both intangible and specific assets. 
E)  there are vertically integrated intangible assets. D

Question 4

Locational advantages in efficiency-oriented investments arise from the availability at a lower cost of the factors of production that are used intensely in the production of a specific product.

Accepted Answer

A) True 
 B)False

Question 5

According to Oatley,the prevalence and organization of MNCs is puzzling to neoclassical economists.

Accepted Answer

A) True 
 B)False

Question 6

Specific assets

Accepted Answer

A)  are investments that are part of a general economic relationship. 
B)  are investments that are dedicated to a particular short-term economic relationship. 
C)  are assets that create incentives for vertical integration because it is difficult to write and enforce long-term contracts. 
D)  are assets whose value is derived from locational advantages that are crucial to the production in a particular industry. 
E)  are assets that create incentives for horizontal integration because they make it easier to write and enforce contracts. 
A)  are investments that are part of a general economic relationship. 
B)  are investments that are dedicated to a particular short-term economic relationship. 
C)  are assets that create incentives for vertical integration because it is difficult to write and enforce long-term contracts. 
D)  are assets whose value is derived from locational advantages that are crucial to the production in a particular industry. 
E)  are assets that create incentives for horizontal integration because they make it easier to write and enforce contracts.

Question 7

Explain where,how and why some developing countries are becoming both the host of foreign firms and home to domestic MNCs.

Accepted Answer

Developing countries are becoming both t

Question 8

In the last forty years,the number of firms engaged in international production has increased about tenfold.

Accepted Answer

A) True 
 B)False

Question 9

In 2008,about half of the top 100 MNCs from developing countries came from Southeast or East Asia.

Accepted Answer

A) True 
 B)False

Question 10

Historically,developing countries have hosted

Accepted Answer

A)  many MNC corporations but the amount of FDI has been relatively small. 
B)  some MNC corporations but the amount of FDI has been relatively small. 
C)  few MNC corporations but the amount of FDI has been relatively large. 
D)  many MNC corporations and the amount of FDI has been relatively large. 
E)  some MNC corporations and the amount of FDI has been relatively large. 
A)  many MNC corporations but the amount of FDI has been relatively small. 
B)  some MNC corporations but the amount of FDI has been relatively small. 
C)  few MNC corporations but the amount of FDI has been relatively large. 
D)  many MNC corporations and the amount of FDI has been relatively large. 
E)  some MNC corporations and the amount of FDI has been relatively large.

Question 11

Describe and compare the volume and location of foreign direct investment (FDI)from 1986 to 2008.

Accepted Answer

From 1986 to 2008, the volume of foreign

Question 12

MNC investment in the developing world has increased during the last 30 years,

Accepted Answer

A)  but the majority of this investment has been concentrated in a very few number of developing countries. 
B)  and the majority of this investment has been spread out among many developing countries. 
C)  and the majority of this investment has gone to the Middle East. 
D)  and the majority of this investment has gone to the Africa. 
E)  and the majority of this investment has gone to Asia. 
A)  but the majority of this investment has been concentrated in a very few number of developing countries. 
B)  and the majority of this investment has been spread out among many developing countries. 
C)  and the majority of this investment has gone to the Middle East. 
D)  and the majority of this investment has gone to the Africa. 
E)  and the majority of this investment has gone to Asia.

Question 13

Vertical integration refers to instances in which firms internalize their transactions for intermediate goods.

Accepted Answer

A) True 
 B)False

Question 14

What role do technology transfers play in assessing the pros and cons of MNCs' contributions to economic interactions between developing and advanced industrial countries?

Accepted Answer

Technology transfers play a crucial role

Question 15

According to the UN,over ¼ of the world's MNC parent firms in 2008 were based in developing countries.As a group,the 100 largest MNCs from developing countries,however,control only about

Accepted Answer

A)  5% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
B)  60% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
C)  45% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
D)  20% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
E)  75% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
A)  5% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
B)  60% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
C)  45% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
D)  20% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries. 
E)  75% of the foreign assets controlled by the largest 100 MNCs based in the advanced industrial countries.

Question 16

Falling trade barriers and improvements in communications technology have made

Accepted Answer

A)  it substantially harder for firms to internationalize their activities. 
B)  it substantially easier for firms to internationalize their activities. 
C)  very little difference for firms wishing to internationalize their activities. 
D)  it more likely for MNCs to systematically exploit workers worldwide. 
E)  it easier for MNCs to avoid paying taxes on their international activities. 
A)  it substantially harder for firms to internationalize their activities. 
B)  it substantially easier for firms to internationalize their activities. 
C)  very little difference for firms wishing to internationalize their activities. 
D)  it more likely for MNCs to systematically exploit workers worldwide. 
E)  it easier for MNCs to avoid paying taxes on their international activities.

Question 17

Multinational corporations (MNCs)highlight the tensions inherent in an economy that is increasingly organized along global lines and political systems that continue to reflect exclusive national territories.

Accepted Answer

A) True 
 B)False

Question 18

Intangible assets are

Accepted Answer

A)  not very important when cost advantages arise from horizontal administrative integration. 
B)  something whose value is not very important. 
C)  assets whose value is derived from locational advantages that are crucial to the production in a particular industry. 
D)  assets that are easy to sell or license to other firms at a price that accurately reflects their true value. 
E)  assets that are difficult to sell or license to other firms at a price that accurately reflects their true value. 
A)  not very important when cost advantages arise from horizontal administrative integration. 
B)  something whose value is not very important. 
C)  assets whose value is derived from locational advantages that are crucial to the production in a particular industry. 
D)  assets that are easy to sell or license to other firms at a price that accurately reflects their true value. 
E)  assets that are difficult to sell or license to other firms at a price that accurately reflects their true value.

Question 19

Foreign investment

Accepted Answer

A)  allows a country only to grow when it does not compete with its domestic savings. 
B)  allows a country to enjoy faster growth than would be possible if it were forced to rely solely on its domestic savings. 
C)  only allows as much growth as desired by foreign management. 
D)  usually replaces domestic savings leading to excessive external indebtedness. 
E)  is usually the least stable and most burdensome for host countries. 
A)  allows a country only to grow when it does not compete with its domestic savings. 
B)  allows a country to enjoy faster growth than would be possible if it were forced to rely solely on its domestic savings. 
C)  only allows as much growth as desired by foreign management. 
D)  usually replaces domestic savings leading to excessive external indebtedness. 
E)  is usually the least stable and most burdensome for host countries.

Question 20

Why do MNCs remain overwhelmingly concentrated in the advanced industrial countries?

Accepted Answer

There are several reasons why multinatio

Describe and explain how MNCs have grown so quickly in the past 40 years.

MNCs started as British creations that first appeared shortly before WW I.

We expect to find the most amount of MNC activity when

Locational advantages in efficiency-oriented investments arise from the availability at a lower cost of the factors of production that are used intensely in the production of a specific product.

According to Oatley,the prevalence and organization of MNCs is puzzling to neoclassical economists.

Specific assets

Explain where,how and why some developing countries are becoming both the host of foreign firms and home to domestic MNCs.

In the last forty years,the number of firms engaged in international production has increased about tenfold.

In 2008,about half of the top 100 MNCs from developing countries came from Southeast or East Asia.

Historically,developing countries have hosted

Describe and compare the volume and location of foreign direct investment (FDI)from 1986 to 2008.

MNC investment in the developing world has increased during the last 30 years,

Vertical integration refers to instances in which firms internalize their transactions for intermediate goods.

What role do technology transfers play in assessing the pros and cons of MNCs' contributions to economic interactions between developing and advanced industrial countries?

According to the UN,over ¼ of the world's MNC parent firms in 2008 were based in developing countries.As a group,the 100 largest MNCs from developing countries,however,control only about

Falling trade barriers and improvements in communications technology have made

Multinational corporations (MNCs)highlight the tensions inherent in an economy that is increasingly organized along global lines and political systems that continue to reflect exclusive national territories.

Intangible assets are

Foreign investment

Why do MNCs remain overwhelmingly concentrated in the advanced industrial countries?

International Political Economy

The World Trade Organization and the World Trade System

The Political Economy of International Trade Cooperation

A Society-Centered Approach to Trade Politics

A State-Centered Approach to Trade Politics

Trade and Development I: Import Substitution Industrialization

Trade and Development II: Economic Reform

The Politics of Multinational Corporations

The International Monetary System

Cooperation, conflict and Crisis in the Contemporary International Monetary System

A Society-Centered Approach to Monetary and Exchange-Rate Policies

A State-Centered Approach to Monetary and Exchange-Rate Policies

Developing Countries and International Finance I: the Latin American Debt Crisis

Developing Countries and International Finance II: a Decade of Crises

Globalization: Consequences and Controversies

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Exam 8: Multinational Corporations in the Global Economy

Describe and explain how MNCs have grown so quickly in the past 40 years.

MNCs started as British creations that first appeared shortly before WW I.

We expect to find the most amount of MNC activity when

Locational advantages in efficiency-oriented investments arise from the availability at a lower cost of the factors of production that are used intensely in the production of a specific product.

According to Oatley,the prevalence and organization of MNCs is puzzling to neoclassical economists.

Specific assets

Explain where,how and why some developing countries are becoming both the host of foreign firms and home to domestic MNCs.

In the last forty years,the number of firms engaged in international production has increased about tenfold.

In 2008,about half of the top 100 MNCs from developing countries came from Southeast or East Asia.

Historically,developing countries have hosted

Describe and compare the volume and location of foreign direct investment (FDI)from 1986 to 2008.

MNC investment in the developing world has increased during the last 30 years,

Vertical integration refers to instances in which firms internalize their transactions for intermediate goods.

What role do technology transfers play in assessing the pros and cons of MNCs' contributions to economic interactions between developing and advanced industrial countries?

According to the UN,over ¼ of the world's MNC parent firms in 2008 were based in developing countries.As a group,the 100 largest MNCs from developing countries,however,control only about

Falling trade barriers and improvements in communications technology have made

Multinational corporations (MNCs)highlight the tensions inherent in an economy that is increasingly organized along global lines and political systems that continue to reflect exclusive national territories.

Intangible assets are

Foreign investment

Why do MNCs remain overwhelmingly concentrated in the advanced industrial countries?

International Political Economy

The World Trade Organization and the World Trade System

The Political Economy of International Trade Cooperation

A Society-Centered Approach to Trade Politics

A State-Centered Approach to Trade Politics

Trade and Development I: Import Substitution Industrialization

Trade and Development II: Economic Reform

The Politics of Multinational Corporations

The International Monetary System

Cooperation, conflict and Crisis in the Contemporary International Monetary System

A Society-Centered Approach to Monetary and Exchange-Rate Policies

A State-Centered Approach to Monetary and Exchange-Rate Policies

Developing Countries and International Finance I: the Latin American Debt Crisis

Developing Countries and International Finance II: a Decade of Crises

Globalization: Consequences and Controversies

Filters