Class Ten Chapter 4 Extra Questions Economics

Chapter 4: Globalisation and the Indian Economy

Additional Questions based on Chapter 4 Class 10 Economics

  Very Short Answer Type Questions. [1 Mark]

1. What is the difference between foreign trade and foreign investment?

Ans. Foreign trade refers to the exchange of commodities across nations. On the other hand, foreign investment means the transfer of capital from one nation to the other.

2. What do you mean by MNCs? Give examples.

Ans. MNC or Multi-National Corporation is a business enterprise which has its business operations in more than one country. For example Samsung, Suzuki, IBM, Honda, etc.

3. What do you mean by foreign trade? Give examples.

Ans. Foreign trade refers to the trading of various commodities across countries. For example selling of Chinese products like mobiles, electronic gadget in India.

4. How the countries of the present world are interconnected?

Ans. In present-day, the countries across the globes are interconnected by means of foreign trade which refers to the trade of goods and services along with the movement of people and investment of capital for performing various functions of Multinational Corporations.

5. Where do MNCs set up their offices?

Ans. MNCs set up offices and factories in regions/countries where they can get cheap labour, cheap raw materials and other factors of production.

6. What is called foreign investment?

Ans. The investment made by MNCs is called foreign investment.

7. What is the benefit to the local company in setting up a joint venture with MNC?

Ans. (i) MNCs can provide money for additional investments.

(ii) MNCs might bring with them the latest technology for production.

8. What is the most common route for MNC investments?

Ans. To buy the local companies and to expand production.

9. Give an example where MNC bought over a local company.

Ans. Cargill Foods, an American MNC bought over Parakh Foods.

10. How do MNCs operate?

Ans. By setting up a partnership with local companies, using them for supplies and buying them up.

11. What is the basic function of foreign trade?

Ans. It creates an opportunity for the producers to sell their goods in foreign markets.

12. Name a few multinational companies.

Ans. Nike, Coca-Cola, Pepsi, Honda, Nokia, etc.

13. Name the factors which have enabled globalisation.

Ans. (i) Rapid improvement in technology, especially information and communication technology.

(ii) Liberalisation

(iii) Work of World Trade Organisation (WTO).

14. Mention the improvement in transportation technology which has enabled globalisation?

Ans. (i) Better connectivity between countries by ships and airways.

(ii) Cost of air transport has fallen.

(iii) The wide use of containers

15. Mention the improvements in transportation system which has enabled globalisation?

Ans. The following improvement in the transportation system has enabled the process of globalization at a rapid rate.

(i) Better connectivity between countries by ships and airways.

(ii) Reduced cost of air transport.

(iii) The wide use of containers.

16. How has improvement in information technology-enabled globalisation?

Ans. Telegraph, telephone, mobile phones, fax, the Internet are widely used to facilitate quick communication.

17. How has the Internet helped in globalisation?

Ans. The Internet allows us to send instant electronic mail (e-mail) and talk (voice-mail) across the world at negligible costs. Use of e-banking facility has also been beneficiary for making all the financial transaction across countries with ease.