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.Management Sciences
Category: International Factor Movements And Multinational Corporations
Firms undertake multinational operations in order to ?
A. hire low-income workers
B. manufacture in nations they have difficult exporting to
C. obtain necessary factor inputs
D. All of the above
Multinational corporations face problems since they ?
A. cannot benefit from the advantage of comparative advantage
B. may raise political problems in countries where their subsidiaries operate
C. can only invest at home but not overseas
D. can only invest overseas but not at home
Which business device involves the creation of a new business by two or more companies often for a limited period of time ?
A. multinational corporation
B. international joint venture
C. horizontal merger
D. vertical merger
American labor unions have maintained that U.S multinational corporations have been ?
A. exporting American jobs by investing overseas
B. exporting American jobs by keeping investment in the U.S
C. importing cheap foreign workers by shifting U.S investment overseas
D. importing cheap foreign workers by keeping U.S investment at home
The market power effect of an international joint venture can lead to welfare losses for the domestic economy unless offset by cost reductions. Which type of cost reduction would not lead to offsetting welfare gains for the overall economy ?
A. R&D generating welfare improved technology
B. development of more productive machinery
C. new work rules promoting workers efficiency
D. lower wages extracted from workers
International joint ventures can lead to welfare losses when the newly established firm ?
A. adds to the pre-existing productive capacity
B. enters markets neither parent could have entered individually
C. yields cost reductions unavailable to parent firms
D. gives rise to increased amounts of market power
Multinational corporations ?
A. increase the transfer of technology between nations
B. make it harder to nations to foster activities of comparative advantage
C. always enjoy political harmony in nations where their subsidiaries operate
D. require governmental subsidies in order to conduct worldwide operations
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