A Swiss multinational food producer raised the prices of its products by an average of 8% in 2022. In the USA, its prices went up by 11.6%. This multinational company (MNC) is among the world’s oldest MNCs. It began as a small business and has expanded over the past 160 years. Throughout this time, opportunity cost has always shaped its decisions.
(a)[2]
Define the term multinational company.
(b)[4]
Explain two reasons why a firm may charge a different price for the same product in two different countries.
(c)[6]
Analyse how opportunity cost affects the choices made by consumers, workers and producers.
(d)[8]
Discuss whether or not consumers would gain from an increase in the number of small firms in an industry.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A business with its headquarters / base in one country” …