A Swiss multinational food manufacturer lifted the prices of its products by an average of 8% in 2022. In the USA, its prices rose by 11.6%. This multinational company (MNC) is among the world’s oldest MNCs. It began as a small firm and has expanded over the past 160 years. Throughout this period, its decisions have always been shaped by opportunity cost.
(a)[2]
Define the term multinational company.
(b)[4]
Explain two reasons why a firm may charge different prices for the same product in two different countries.
(c)[6]
Analyse how opportunity cost affects the decisions taken by consumers, workers and producers.
(d)[8]
Discuss whether consumers would benefit from an increase in the number of small firms within an industry.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Has its base / headquarters in one country” …