Lesson 35-Globalisation

Question 1

Define globalization

Answer 1

The increasing integration and interdependence of the world economies.

Question 2

Explain four reasons for globalization

Answer 2

1. Technological advancements
2. The development of transport networks has meant people can travel more easily and cheaply
   3.Deregulation has meant that there is more competition and many trade barriers have been removed which means that there is more free trade
3. The development of MNC’s has meant that goods can be produced and purchased from anywhere in the world

Question 3

Six advantages of globalization

Answer 3

1. The removal of trade barriers will mean that more goods and services will be produced in an economy leading to economic growth.
2. People can consume a wide variety of goods and services which will raise living standards
3. Rising level of employment will be experienced from the location of MNC’s in countries.
4. Increased levels of govt tax revenue from MNC’s in the form of income and corporation tax
5. Firms will be able to benefit in the long run from technology and knowledge transfer from MNC’s
6. Export orientated countries will benefit from an increase in export revenue.

Question 4

Five disadvantages of globalization

Answer 4

1.Exploitation of scarce resources by MNC’s thereby affecting sustainable development of countries
2. Exploitation of labor by MNC’s
3. Because o deregulation countries may experience an increase in the BOP deficits due to high levels of import penetration.
4. Over dependence by countries on imports of other countries will make them vulnerable to external shocks.
5. Cultural imperialism- Loss of domestic cultures due to a more westernized culture being artificially injected to local societies