Economics: Today and Tomorrow © 2012

Introduction
Students have learned about the way multinational companies function in the worldwide economy. In this exercise, students will examine the annual report of a multinational, the Coca-Cola Company, to learn how a multinational company can affect local economies.

Lesson Description
Students will use information from the Coca-Cola Web site to learn how multinational companies operate. Students will learn that the company is divided into regions, that economic and environmental factors worldwide can affect business growth, and how the company attempts to solve negative issues. Students will also read about the positive impact that Coca-Cola's presence has had on developing countries. Students will then answer four questions and apply this information by creating a report indicating the benefits, opportunity costs, and economic risks of the company's investments in developing nations.

Previous Knowledge Expected
multinationals: firms that do business and have offices or factories in many countries
opportunity costs: cost of the next best alternative use of money, time, or resources when one choice is made rather than another

Applied Content Standards (from the Council for Economic Education)Standard 15: Investment in factories, machinery, new technology, and the health, education, and training of people can raise future standards of living.

1. Students will to able to identify the characteristics of a multinational company and determine that its investments, in both physical and human capital, research and development, and technology are necessary for growth.
2. Students will be able to use this knowledge to create a report listing the benefits, opportunity costs, and economic risks of Coca-Cola's investments in developing countries.

1. The Coca-Cola Company's operations are divided into the following operating groups: North America; Latin America; European Union; North Asia, Eurasia, & Middle East; East, South Asia, & Pacific Rim; and Africa.
2. Teacher may prepare an answer sheet from the most recent Annual Report.
3. Teacher may prepare an answer sheet from the most recent Annual Report.
4. Coca-Cola's presence in countries experiencing economic or political turmoil or natural disasters provides needed jobs for the people of those countries. Through its bottling companies, which are mostly owned by independent business people, and its sales force, Coca-Cola employs hundreds of thousands of people. In Africa, Coca-Cola provides business training and development programs to assist thousands of employees within its system develop their skills. In addition, it has made a commitment to invest $1 billion in bottling plants, cold drink equipment, and talent development over the next few years. This investment will enhance economic development in Africa.
5. Students' reports will vary.