IGCSE Development Studies: Specimen Questions with Answers 47 - 48 of 98

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Understand by Globalization

Question 47 (5 of 8 Based on Passage)

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Explain the following:

Joint ventures

Explanation

Joint ventures: Joint venture reefers to the co-operation of two or more individuals or business in which each agrees to share profit and loss and control in a specific enterprise. It is usually a temporary partnership without the use of a firm name. It limited to the specific purpose for which the persons agree to contribute capital and share losses. The liability of the partners is limited to the venture concerned for which they agree to contribute capital and share profit and losses.

Features of Joint Venture Are

  • Agreement between two or more persons.
  • Joint venture is made for the specific execution of a project or task. Thus, the going concern concept of accountancy is not applicable to a joint venture.

  • Agreement for joint venture is dissolved as soon as the specific project is over.

  • The profit and loss of joint venture is computed on completion of the venture.

Question 48 (6 of 8 Based on Passage)

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State 2 advantages and disadvantages of Globalization

Explanation

Advantages of Globalization

  • It helps other countries share information about technological developments to developing countries.
  • Globalization makes the economy of one country dependent on the economy of other countries.

Disadvantage of Globalization

  • Increased flow of skilled and non-skilled jobs from developed to developing nations as corporations seek out the cheapest labor

  • Corporate influence of nations states far exceeds that of civil society organizations and average individuals.