Question

Why do MNCs hire various services from other countries?

• A. To provide job opportunities in foreign countries
• B. MNCs lack technical skills.
• C. To keep the cost of production low and make more profits
• D. MNCs usually do not serve their home countries.

Answer 1

The correct option is C To keep the cost of production low and make more profits

MNCs manufacture in countries where they can procure raw materials and labour at cheaper rates. This helps them reduce their cost of operation and thereby increase profit margins.