ACCA Applied Knowledge · Business and Technology · Political and legal factors affecting business
Which of the following is a commonly cited benefit of globalisation for a business?
A commonly cited benefit is access to larger markets and lower-cost sources of supply, such as cheaper labour or materials. Globalisation does not remove national legal or cultural differences, and it increases competition from foreign firms.
- AAccess to larger markets and lower-cost sources of supplyCorrect
- BElimination of all differences in national laws and cultures
- CGuaranteed protection from foreign competitors in the home market
Explanation
Globalisation lets firms sell into wider markets and source inputs or labour more cheaply. It does not remove legal and cultural differences, and it increases rather than reduces foreign competition in the home market.
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