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Ch 8Multi National Corporations (MNCs) — Class 11 Commerce, concept-first.

Most businesses studied so far in this unit — sole proprietorships, partnerships, cooperative societies, even a single joint stock company — operate and are owned within one country.

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Key concepts

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Meaning and Definition of a Multi National Corporation

An MNC is a company incorporated and headquartered in one home country that owns or controls production or service facilities in one or more other (host) countries through foreign direct investment — mere exporting, with…

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Chapter contents

The NCERT structure, section by section. Open a section to see its questions, then read the concept-first solution.

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Meaning and Definition of a Multi National Corporation

Most businesses studied so far in this unit — sole proprietorships, partnerships, cooperative societies, even a single joint stock company — operate and are owned within one country.

2

Features of MNCs

MNCs share a recognisable set of characteristics that distinguish them from an ordinary domestic company, however large the latter may be.

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Modes of MNC Entry and Operation

An MNC does not always set up business in a host country in the same way. Depending on capital available, the host country's laws, and the level of control desired, an MNC typically uses one or more o…

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Merits of MNCs to a Host Country

Countries like India actively invite MNC investment because it brings several genuine economic benefits to the host country.

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Demerits of MNCs

Alongside their benefits, MNCs have also been genuinely criticised on several grounds, and a balanced study of the topic must cover both sides.

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Role of MNCs in the Indian Economy

India's approach to MNCs changed sharply with the New Economic Policy of 1991 (economic liberalisation, privatisation and globalisation reforms), which relaxed the earlier restrictive licensing regime…

Short Answer Questions

+Show 3 questions3 questions
  1. Q4Define a Multi National Corporation.Free
  2. Q5State any four features of MNCs.Preview
  3. Q6What is a Joint Venture? How does it differ from a Wholly Owned Subsidiary as a mode of MNC entry?Preview

Long Answer Questions

+Show 3 questions3 questions
  1. Q7Explain the merits of MNCs to a host country like India.Free
  2. Q8Discuss the demerits (criticisms) of MNCs operating in a host country.Preview
  3. Q9Explain the role of MNCs in the Indian economy, especially since the economic reforms of 1991.Preview

Sample & Board Papers

Sample papers and previous-year board questions for this subject.

+Show 4 questions4 questions
  1. Q1Give two examples of MNCs.Preview
  2. Q2(a) What are the disadvantages of Multinational Corporations (MNCs) ? OR (b) Explain the types of Banks based on ownership pattern.Preview
  3. Q3(a) What are the advantages of MNCs ? (any 5) OR (b) Explain the advantages of Railway transport. (any 5)Preview
  4. Q4Centralised control in MNC's implies control exercised by (a) Branches (b) Subsidiaries (c) Headquarters (d) ParliamentPreview

More questions

+Show 3 questions3 questions
  1. Q1A Multi National Corporation is a company that owns or controls production/service facilities: (a) only in its home country (b) in one or mo…Free
  2. Q2Which of the following is NOT a feature of an MNC? (a) Huge size and capital resources (b) Centralised control from a home-country headquart…Preview
  3. Q3When an MNC sets up a company in the host country and holds full (100%) ownership of its share capital, this mode of entry is called a: (a)…Preview