Question

Attempt the following.

Merits of Multinational Corporation.

Answer 1

The following are the merits of Multinational Corporation:

1. proper use of Idle Resources: The national income of the host country increases as MNCs use idle physical and human resources with the latest technologies.
2. The inflow of Foreign Capital: Multinational corporations bring much needed foreign capital for the rapid development of developing countries. This capital is useful for the growth of domestic countries.
3. Promotion of International Brotherhood and Culture: MNCs integrate economies of various nations with the world economy and promote international brotherhood and culture with peace and prosperity in the world.
4. End of Local Monopolies: In the global market, Multinational Corporations end local monopolies of host countries improving their products and reduces prices.
5. Technical development: Multinational corporations gives a lot of importance to research and development activities. They are also fully equipped and have the necessary infrastructure. The research and development is undertaken for finding out a new product, new system, and new technology of doing business in an economical way.
6. Improvement of Standard of Living: Multinational Corporations supply their product at very reasonable prices in the global market. E.g. the price of wristwatches, cell phones, etc. This helps to improve the standard of living of people in host countries.
7. Managerial Development: Multinational corporations have a highly specialized and expert team of management. These experts are hired by different countries of the world. Also, their functioning is highly professional. They adopt new technology and use huge resources.
8. Employment Generation: MNCs create large scale employment opportunities in host countries and helps in reducing unemployment.