Business Studies

Which of the following statement is incorrect?
$$(1)$$ MNCs have less impact on the development process of the under developed countries.
$$(2)$$ Some MNCs may be 'footloose' i.e., to say - they might locate in a country to gain the tax or grant advantages but then move away when these run out.
Select the correct answer from the options given.


ANSWER

$$(1)$$ only


SOLUTION
Multinationals provide an inflow of capital into the developing country. E.g. the investment to build the factory is counted as a capital flow on the financial account of the balance of payments. This capital investment helps the economy develop and increase its productive capacity.
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Single Correct Medium Published on 18th 08, 2020
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