HOTS QUESTION:
Being the manager of a company your owner wants to further expand his business. Would you suggest collaborating with another business forming a joint stock company or creating networks forming MNC?? substantiate your answer.
Gayathry,
As we know, every coin has two aspects-positive and negative. So, being a manager of the company, he must first make a thorough study of the merits and demerits of joint stock company and MNCs. For example- if the company does not want to disclose all its information, than it should not opt for collaborate with a joint stock company. If the company want to remain free from legal regulations and provisions, then it should avoid to collaborate with joint stock company. However, the benefit of limited liability is available to its shareholders in case of collaboration with joint stock company. A company can create networks forming MNC if it has a large amount of capital resources for investment. Moreover, if the company wants advancement of technology and to bring its product in market in an innovative way, then it should opt for creating a network to form MNC.
As we know, every coin has two aspects-positive and negative. So, being a manager of the company, he must first make a thorough study of the merits and demerits of joint stock company and MNCs. For example- if the company does not want to disclose all its information, than it should not opt for collaborate with a joint stock company. If the company want to remain free from legal regulations and provisions, then it should avoid to collaborate with joint stock company. However, the benefit of limited liability is available to its shareholders in case of collaboration with joint stock company. A company can create networks forming MNC if it has a large amount of capital resources for investment. Moreover, if the company wants advancement of technology and to bring its product in market in an innovative way, then it should opt for creating a network to form MNC.