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Global and Regional Economic Integration, Global Trade, Foreign Direct Investment, Foreign Exchange Markets, and Capital Markets Are All Discussed in This Course as Influencing Both the Profitability and the Market Share of Multinational Corporations (mnc

Autor:   •  June 7, 2016  •  Presentation or Speech  •  330 Words (2 Pages)  •  715 Views

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Since global and regional economic integration, global trade, foreign direct investment, foreign exchange market, and capital markets all are influential to enhance both the profitability and the market share of multinational corporations (MNCs), I think in order to select possible influences that has the greatest impact on the profitability is a foreign direct investment (FDI) which is controlling ownership in a business enterprise in one country by an entity based in another country. There are four different methods to FDI incorporating a wholly owned subsidiary or company anywhere, by acquiring shares in an associated enterprise, through a merger or an acquisition of an unrelated enterprise, and participating in an equity joint venture with another investor or enterprise. All these four methods are prime methods to increase profitability of an MNC. By foreign direct investment, an MNC can have lots of incentive in doing business outside of its parent territory. Some of the incentives are low corporate tax and individual income tax rates, tax holidays, other types of tax concessions, preferential tariffs, investment financial subsidies, free land or land subsidies, relocation & expatriation, infrastructure subsidies, R&D support etc. These all are much influential incentives to boost up an MNC’s overall profitability for which Foreign Direct Investment has the greatest impact to increase profitability of an MNC.

I think Global Trade or International Trade has the greatest impact on the market share of MNCs. International trade is the exchange of capital, goods, and services across international borders or territories, which could involve the activities of the government and individual. In most countries, such trade represents a significant share of gross domestic product (GDP). Trading globally gives consumers and countries the opportunity to be exposed to new markets and products. Almost every kind of product can be found on the international


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