UPSC Exam > UPSC Questions > Which one is false ?a)MNCs acquire small comp...
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Which one is false ?
- a)MNCs acquire small companies to expand production
- b)MNCs enter into joint venture to enter into foreign markets
- c)MNCS offer subsidy to the small scale industries
- d)MNCs set up own production center in foreign countries
Correct answer is option 'C'. Can you explain this answer?
Verified Answer
Which one is false ?a)MNCs acquire small companies to expand productio...
Information and communication technology (or IT in short) has also played a major role in globalisation. Many MNCs are service based companies therefore the transfer of information is very vital to them. Computers , internet facilities, telegraph, telephones mobile phones, and fax are used to contact one another around the world, to access information instantly, and to communicate from remote areas.
Liberalisation of foreign trade and investment policy has speeded up the globalization process. During the end of the 20th century, India removed trade barriers and foreign goods flooded the Indian market. Barriers on foreign investment were also removed to a large extent enabling many MNCs to set up their factories in India.
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Which one is false ?a)MNCs acquire small companies to expand productio...
Explanation:
The false statement is option 'C' which states that MNCs offer subsidies to small-scale industries. Let's understand why this statement is false.
1. MNCs Acquire Small Companies to Expand Production:
MNCs often acquire small companies to expand their production capabilities. This allows them to increase their market share, access new technologies and resources, and diversify their product portfolio. Acquiring small companies can also help MNCs enter new markets quickly and efficiently.
2. MNCs Enter into Joint Ventures to Enter Foreign Markets:
MNCs frequently enter into joint ventures with local companies in foreign markets. This allows them to leverage the local partner's knowledge, expertise, and established distribution networks. Joint ventures provide MNCs with a strategic advantage by reducing risks and costs associated with entering unfamiliar markets.
3. MNCs Set Up Own Production Centers in Foreign Countries:
To expand their global presence, MNCs often establish their own production centers in foreign countries. This enables them to benefit from lower labor costs, access new markets, reduce transportation costs, and mitigate trade barriers. Setting up production centers abroad also helps MNCs tailor their products to local preferences and regulations.
4. MNCs Offering Subsidies to Small-Scale Industries:
The statement that MNCs offer subsidies to small-scale industries is false. MNCs are profit-oriented entities that operate in a competitive business environment. Their primary objective is to maximize shareholder value, and offering subsidies to small-scale industries would not align with this objective. Subsidies are typically provided by governments or organizations to promote the growth and development of small-scale industries.
In conclusion, while MNCs may acquire small companies, enter into joint ventures, and set up their own production centers in foreign countries, they do not offer subsidies to small-scale industries.
The false statement is option 'C' which states that MNCs offer subsidies to small-scale industries. Let's understand why this statement is false.
1. MNCs Acquire Small Companies to Expand Production:
MNCs often acquire small companies to expand their production capabilities. This allows them to increase their market share, access new technologies and resources, and diversify their product portfolio. Acquiring small companies can also help MNCs enter new markets quickly and efficiently.
2. MNCs Enter into Joint Ventures to Enter Foreign Markets:
MNCs frequently enter into joint ventures with local companies in foreign markets. This allows them to leverage the local partner's knowledge, expertise, and established distribution networks. Joint ventures provide MNCs with a strategic advantage by reducing risks and costs associated with entering unfamiliar markets.
3. MNCs Set Up Own Production Centers in Foreign Countries:
To expand their global presence, MNCs often establish their own production centers in foreign countries. This enables them to benefit from lower labor costs, access new markets, reduce transportation costs, and mitigate trade barriers. Setting up production centers abroad also helps MNCs tailor their products to local preferences and regulations.
4. MNCs Offering Subsidies to Small-Scale Industries:
The statement that MNCs offer subsidies to small-scale industries is false. MNCs are profit-oriented entities that operate in a competitive business environment. Their primary objective is to maximize shareholder value, and offering subsidies to small-scale industries would not align with this objective. Subsidies are typically provided by governments or organizations to promote the growth and development of small-scale industries.
In conclusion, while MNCs may acquire small companies, enter into joint ventures, and set up their own production centers in foreign countries, they do not offer subsidies to small-scale industries.
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Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer?.
Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer?.
Solutions for Which one is false ?a)MNCs acquire small companies to expand productionb)MNCs enter into joint venture to enter into foreign marketsc)MNCS offer subsidy to the small scale industriesd)MNCs set up own production center in foreign countriesCorrect answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for UPSC.
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