Tag: public sector undertakings & global enterprises

Questions Related to public sector undertakings & global enterprises

Global enterprises are in position to exercise massive control on world economy.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. True

  2. False

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Correct Option: A
Explanation:

Top 200 MNC'S control over a quarter of the world economy. Therefore MNC'S are in a position to exercise massive control on the world economy because of their capital resources, latest technology and goodwill.

Which of the following is not a characteristic of MNCs?

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. Huge size

  2. Operation in a single nation

  3. Large number of products

  4. Marketing strategies

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Correct Option: B
Explanation:

MNC'S are gigantic corporations which have their operations in a number of countries. They are characterized by their huge size, large number of products, advanced technology, marketing strategies and network of operations all over the world.

The main aim of global enterprises is to ______________.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. gain profits from the products

  2. provide different types of products

  3. to spread their branches all over

  4. to gain market share in a particular country

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Correct Option: C
Explanation:

Global enterprises are the companies that operate around the world.Through a network of their branches in several countries, global enterprises extend their industrial and marketing operations. Their vision to work across many global frontiers to earn in international currencies of many countries.

Global enterprises have to make extra efforts with their marketing strategy in an untapped market.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. True

  2. False

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Correct Option: A
Explanation:

Vertical Expansion - Manufacturing

Vertical expansion occurs when multinational companies expand production processes to other countries. This strategy allows them to take advantage of factors such as the low costs of labor and raw materials, lower capital investment requirements and less stringent local laws and regulations. This means these companies can lower production costs and maximize profits. Some developing countries encourage multinational companies because of the innovative technology they bring to the host country and because they typically offer higher wages than the national average.

Vertical Expansion - Sales

Multinational companies also might expand by setting up sales units in host countries instead of marketing their products through local agencies. This allows the companies to ensure that their products reach their buyers and that they are in control of prices. Multinationals also may enter foreign markets when other brands offering the same products set up operations there. Competition makes it necessary for these companies to follow suit with units of their own. Multinational companies can give their sales units a level of autonomy, which allows them to operate and adapt their sales efforts according to market conditions in the host country.

Horizontal Expansion - Production

Often, multinational companies set up production units in other countries for the sole purpose of catering to the local market. They manufacture products in the host country for distribution in the same country. This helps companies save on transportation costs and shields their operations from uncertainties arising from fluctuations in currency values. They also use sequential marketing, a strategy that edges out the local competition by offering better and more state-of-the-art products. Another method they might use to eliminate competition is to merge with or acquire local companies.

Horizontal Expansion - Sales

When offering products in the host countries, multinational companies may present their goods and services just as they are offered in their home countries. Examples include branded and packaged food and beverages. They carry similar brand names and are similar in appearance. Companies also might set up showrooms and outlets to mimic international norms. Other companies adapt their products to suit local demand, tastes and customer requirements.

Collaboration with MNCs also lead to growth of monopolies.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. True

  2. False

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Correct Option: A
Explanation:

MNCs also lead to the growth of monopolies. A multinational corporation (MNC) has facilities and other assets in at least one country other than its home country. Very large multinationals have budgets that exceed those of many small countries.

Multinational corporations are sometimes referred to as transnational, international or stateless corporations.

Highly developed research and development departments help in the task of developing _________.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. new advanced products

  2. higher profits

  3. patents and copyrights

  4. monopoly of the MNCs

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Correct Option: A
Explanation:

Global enterprises are characterized by having highly sophisticated research and development departments engaged in the task of developing new products and superior designs for existing products.

Aggressive market strategies are used by global enterprises to __________________.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. gain more market share

  2. increase their sales in short period

  3. tap the market from existing business

  4. grow their reach in a nation

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Correct Option: B
Explanation:

Aggressive Market. A market or exchange with a high trading volume. When a market becomes very aggressive, the prices of stocks can go up significantly, which in turn makes it more expensive for a trader to become involved in the market by buying stocks.

Global enterprises have a problem in market penetration.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. True

  2. False

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Correct Option: B
Explanation:

Global enterprises does not have any problem in market penetration  because their operations and activities extend beyond the physical boundaries of their own countries. 

Global Enterprises usually have centralized control in their home nation.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. True

  2. False

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Correct Option: A
Explanation:

Global enterprises have their headquarters in their home country and exercise control over all branches and subsidiaries. This control is limited to the broad policy framework of the parent company.

Restrictive clauses are signed by the global enterprises to safeguard __________.

organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

  1. transfer of technology

  2. pricing

  3. dividend of payments

  4. all of the above

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Correct Option: D
Explanation:

A restrictive clause is a clause which functions as an adjective to identify the word it modifies. A restrictive clause is essential for the intended meaning. A restrictive clause is not offset with commas.