When an MNC sets up production in a new country through a joint venture with a local company, what does the l…

Question

When an MNC sets up production in a new country through a joint venture with a local company, what does the local company gain from this arrangement?

Accepted Answer

## Model Answer When a local company enters a joint venture with an MNC, it gains in two ways: 1. **Additional investment**: The MNC provides money to buy new machines, enabling faster production. 2. **Latest technology**: The MNC brings advanced production technology, improving efficiency and output quality. *Source: Chapter 4, Interlinking Production Across Countries* --- ## Explanation The answer is directly lifted from the textbook line: *"The benefit to the local company of such joint production is two-fold."* Examiners expect both points to be stated clearly. For 2 marks, one point each — keep it crisp and label them. Avoid writing general benefits; stick to the two specific ones the textbook mentions.

Social Science (087) — AI-generated practice question