Which of the following stakeholders will not likely benefit from a business becoming a multinational?local governmentsownerscustomerslocal businesses
Question
Which of the following stakeholders will not likely benefit from a business becoming a multinational?local governmentsownerscustomerslocal businesses
Solution
The stakeholder that will not likely benefit from a business becoming a multinational is local businesses. Here's why:
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Increased Competition: When a business becomes a multinational, it expands its operations into new markets. This can lead to increased competition for local businesses, as they now have to compete with a larger, more established company.
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Market Dominance: Multinational corporations often have significant resources at their disposal, allowing them to dominate the market. This can make it difficult for local businesses to compete.
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Loss of Customers: If the multinational corporation offers lower prices or a wider range of products, customers may choose to shop there instead of at local businesses.
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Economic Displacement: In some cases, the arrival of a multinational corporation can lead to economic displacement. This occurs when the multinational corporation takes over the resources that were previously used by local businesses.
Therefore, while local governments, owners, and customers might see benefits from a business becoming a multinational (through increased tax revenues, profits, and product choices, respectively), local businesses might face increased competition and potential loss of revenue.
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