Question

In order to achieve cost economies, Tull and Ward Company bases production plants for labor-intensive products in low-wage countries such as Mexico and locates production plants that require skilled workers in high-skill countries like Japan. This illustrates the: A. International model B. Multinational model C. Global model D. Transnational model

Answer 1

Answer:

D. Transnational model

Explanation:

Companies that have headquarters in their country of origin and work in other countries through the installation of subsidiaries, are classified as transnational companies.

For developing countries, the installation of these companies in their territory is a positive factor, as it generates new jobs, in addition to promoting industrialization in the region. In turn, the transnationals use as criteria to set up their branches, places with potential market consumer, infrastructure, raw material, energy and cheap labor. Moreover, when work requires high performance, firms open branches or offices in countries where the workforce is most qualified.