A country that has multinational corporations is most likely to be:

• A. an economy that relies solely on domestic production
• B. a closed economy with limited foreign investment
• C. an open economy engaged in international trade
• D. a subsistence economy with minimal market activity

Answer: (C)

Verified step by step guidance

1. Step 1: Understand the key terms in the problem. A 'multinational corporation' is a company that operates in multiple countries, involving cross-border investment and trade.
2. Step 2: Define the types of economies mentioned: a 'closed economy' does not engage in international trade or investment; a 'subsistence economy' relies mostly on self-sufficient production with minimal market activity; an 'open economy' participates actively in international trade and investment.
3. Step 3: Analyze the presence of multinational corporations. Since these corporations operate across countries, their existence implies that the economy is open to foreign investment and international trade.
4. Step 4: Compare the options given with the characteristics of an economy hosting multinational corporations. The economy cannot be closed or subsistence because those limit or exclude international economic activity.
5. Step 5: Conclude that the economy is best described as an open economy engaged in international trade, as this aligns with the presence and operation of multinational corporations.