CBSE Class 10 Answered

Advantages of MNCs- developing countries

• The industries of developed country get latest technology from foreign countries through MNC's.
•  The investment level, employment level, and income level of the developing country increases due to the operation of MNC's.
•  They can reduce imports and increase exports due to goods produced by MNC's- balance of payment.
•  Greater availability of products for local consumers
•  MNC's break protectionalism, curb local monopolies, create competition among domestic companies- enhance their competitiveness.

Advantages of MNCs- developed countries

•  MNC's create opportunities for marketing the products produced in the developed country throughout the world.
•  They create employment opportunities to the people both at home and abroad.
•  It gives a boost to the industrial activities of developed country.
•  MNC's help to maintain favourable balance of payment in the long run.
• They can also get the benefit of foreign culture brought by MNC's.
• They get benefit from several research and development activities.

Disadvantages of MNCs

• Foreign investors created regional disparities
• Slow down in the employment in home countries
• Destroy competition and acquire monopoly
• Indians spend their money on a variety of global brand sin market
• Qualified persons are posted abroad in their foreign subsidiaries
•  Large sum of foreign exchange flows out of the country
•  Trade restrictions imposed at the government level
•  Limited quantities (quotas) of imports
•  Effective management of a globally dispersed organisation