Question

MNCs can use their global presence toa. take advantage of underpriced labor services available in certain developing countries. b. gain access to special R&D capabilities residing in advanced foreign counties. c. boost profit margins and create shareholder value.d. avoid regulations and lower tax burdern

Answer 1

From all indications, the options should include option e which should be' all of the options'

All the options apply to Multinational Companies

Step-by-step explanation:

Diversification refers to having a portfolio of investments,products, businesses or operating in many locations where losses in one area can be counterbalanced with profits from another .

This is particularly true of MNCs as they are have to reduce cost of labor,access world class research and development capabilities ,lower tax burdens overall as well as maximize their margins and invariably their shareholders' wealth by operating in different jurisdictions of the world

Answer 2

a. take advantage of underpriced labor services available in certain developing countries.

b. gain access to special R&D capabilities residing in advanced foreign counties.

c. boost profit margins and create shareholder value.

d. avoid regulations and lower tax burdern

Step-by-step explanation:

Multinational corporation is a company that operates locally in its home country and also aborad. It usually maintains a central office that coordinates business activities.

MNCs have various advantages which includes:

- taking advantage of lower priced labour in developing countries, for example some companies take advantage of cheap labour in China to produce their goods.

- when a company operates in an advanced economy it will take advantage of research and development there.

- regulations and tax burdens can be avoided by setting up manufacturing plants in countries with low regulatory policies.

- MNCs boost shareholder profits by taking advantage of their multiple locations to gain more profits.