Which of the following factors are determinants of Multinational-Enterprise (MNE) location and production choices?i). Profits: price per unit * quantity soldii). Factor advantages: comparative cost advantagesiii). Technology: plant level economies of scaleiv). Markets: internal market size; unique featuresa.ii,iii,ivb.i,iii,ivc.I,ii,iiid.i, ii, iv
Question
Which of the following factors are determinants of Multinational-Enterprise (MNE) location and production choices?i). Profits: price per unit * quantity soldii). Factor advantages: comparative cost advantagesiii). Technology: plant level economies of scaleiv). Markets: internal market size; unique featuresa.ii,iii,ivb.i,iii,ivc.I,ii,iiid.i, ii, iv
Solution
The correct answer is c. I, ii, iii. These factors - profits, factor advantages, and technology - are all key determinants of Multinational-Enterprise (MNE) location and production choices. Profits are a primary motivator for any business, including MNEs. Factor advantages, such as lower labor or production costs, can make certain locations more attractive for MNEs. Technology, particularly economies of scale at the plant level, can also influence where MNEs choose to locate and produce. While market size and unique features can also be important, they are not included in the options given.
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