Transnational Corporations Flashcards

All 5 cards in this deck

What is a transnational corporation (TNC)?

A company that has operations in more than one country, usually with its headquarters in an HIC.

What is Foreign Direct Investment (FDI)?

Investment made by a foreign company or country into industry and infrastructure in the host country.

Give two advantages of a TNC to the host country.

Direct and indirect employment, which raises disposable income, and tax payments that increase government revenue for infrastructure and services.

Give two disadvantages of a TNC to the host country.

Environmental damage such as pollution of land, water and air, and most profits being sent back to the TNC's home country.

Why do many TNCs place their factories in LICs or NEEs?

Labour and land are cheaper, and environmental and working regulations are often less strict, so production costs are lower.