Tag: meaning and features of mncs

Questions Related to meaning and features of mncs

Global market leader is an organization which _________.

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

  1. has more than $50\%$ global market share.

  2. is recognized as being ahead of the rest in terms of market share

  3. is ahead of the competition in terms of global innovation

  4. has the monopoly over several foreign markets

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Correct Option: B
Explanation:

Global market leader is an organization which is recognized as being ahead of the rest of the organizations in the global market in terms of the market share of the organization.

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M.B.O is a technique which requires that objectives of the enterprise.

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

  1. Be written and defined in broad terms

  2. Lay down the time period for achieving the results

  3. Induce a plan of action for achieving the desired results

  4. Be defined in terms of measurable results

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Correct Option: D

A Company which has gone global is called a _______.

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

  1. Multinational

  2. Transnational

  3. Either (A) or (B)

  4. None of these

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Correct Option: C
Explanation:

MNC has an international identity as belonging to a particular home country where they are headquartered. A transnational company is borderless, as it does not consider any particular country as its base, home or headquarters. Transnational corporations are a type of multinational corporations.

Out of the following _________ represents a company's effort to identify and categorize groups of customers and countries according to common characteristics.

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

  1. global targeting

  2. global marketing research

  3. global marketing segmentation

  4. global positioning.

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Correct Option: C
Explanation:

The global marketing segmentation represents a company's efforts to identify and categorize groups of customers and countries according to common characteristics.

If it is a global organization it means _______.

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

  1. creating both standardized and customized products

  2. creating standardized products for homogeneous markets

  3. customizing the product range for each segment in part

  4. none of the above

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Correct Option: A
Explanation:

A global organization is creating both type of products, i.e standardized product for a region that sell standardized products and also customized products for customers.

MNCs have played a huge role in the Indian economy in the past decade.

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:

In the last ten years MNC'S have played an important role in the Indian economy. They have become a common feature of most developing economies in the world. 

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.