Question

What are MNC's? Why are they domestic producers currently?

Answer 1

It is a corporation with proper registration that operates in more than one country.The work in collaboration with local companies or by buying out domestic companies or making the latter work for them. Their main features are:

i) They base their operations in many different countries based upon market demand and availability of cheap labour.

ii) They bring huge investments along with modern technology into production. They expand production by buying up local companies or entering into partnership with them.

iii) They link the supply chain across countries and lead to integration of markets. In doing so, they drive prices in the local market and provide stiff competition to local small scale industries.