In MNCs , the biggest challenge will be access to sufficient capital

mpanies tend to go out of their own countries to establish multinational corporations (MNC). Today, we shall explore how an MNC works and what the advantages are.

When a corporation expands its activities overseas and engages in international trade, it could be on the way to becoming a multinational corporation. A multinational corporation has industrial and commercial organizations in foreign countries. Manufacturing plants are established abroad, along with supporting marketing systems. These activities have political and economical implications.

International markets are developed when an MNC finds limitations in the home market. It tries to approach a foreign market in the most effective way — either on the local level or nation, al level.

Decisions made in an MNC axe locally inspired. But major decisions are made by a central management, located in the country of the origin of the MNC. In a transnational corporation, decisions are made by officials of the overseas nationality. The country of the origin do not interfere with the decision making process.

How multinational can a corporation get？ Some companies, like Nestl6 of Switzerland, make over 90% of their sales on exports and manufactured goods abroad. Today, the large MNCs control from 50 to 200 foreign branches with 30 to 90 percent of their sales exported and produced abroad.

A favourable aspect about MNCs is that they create jobs in foreign countries. They also contribute to innovation or creation of new products and technology. But when innovation levels off and local technology reaches a point of sufficiency, MNCs are sometimes considered to be no longer useful. At this point MNCs rum the risk of nationalization.

Most MNCs are made up of vast numbers of foreign subsidiaries, companies in which over 50 percent of shares is owned by the parent company. Like all corporations, MNCs are organized according to the goals they set for themselves. They strive to retain' access to the resources that ensure the smooth operation of a company: raw materials, manpower, and capital. Furthermore, they try to grow in the global corporation by increasing their access to world resources. This leads them to expand their foreign market position, in other words, to increase their market share.

？ Look at the notes about multinational corporations.

？ Some information is missing.

？ You will hear part of a presentation by the consultant of an international investment company.

？ For each question 16-22, fill in the missing information in the numbered space using one or two words.

？ You will hear the presentation twice.

Multinational Corporations

An MNC has (16) ______ overseas

Plants built up with (17) supporting ______

World market developed due to (18) ______ in home market

Major decisions made by (19) central ______

Large MNCs get (20) ______

Advantages: (21) create ______

(22) contribute to ______ or creation

(16)

e of a global network of production and distribution. This competitive advantage arises in part from vertical and horizontal integration with foreign affiliates. By vertical integration, most MNCs can ensure their supply of foreign materials and intermediate products and avoid the imperfections often found in foreign markets. They can also provide better distribution and service networks. By horizontal integration through foreign affiliates, MNCs can better protect and exploit their monopoly power, adapt their products to local conditions and tastes, and ensure consistent product quality.

A、a biggest city

B、the bigest cities

C、the biggest cities

D、the biggest city

The biggest category of information-based occupations is information______．

A．compute

B．revolution

C．economy

D．processors

Which of the following is TRUE according to the passage？

A．Alaska is the biggest city in America.

B．Alaska is the second biggest state in America.

C．Texas is the biggest city in America.

D．Texas is the second biggest state in Americ

Organic agriculture accounts for the biggest proportion of the American agriculture.

A．Y

B．N

C．NG