Bc a lot of people buy their products, so they have enough money to make a profit even if they sell it at a lower cost.
Answer:
arbitration
Explanation:
Arbitration occurs when the price of a security or a commodity varies significantly between different markets. For example, I purchase gold in the United Kingdom at a lower price than in the United States, and I bring it to the United States and make a profit. Arbitration opportunities result from market inefficiencies and a lack of a single price.
Answer:
The elimination of the North division would result in an increase to net operating income of $100,000 for the South division.
Explanation:
Please see computation of the company's overall net profit
= South sales - South variable costs - South traceable fixed costs - South allocated common corporate cost - North allocated common corporate cost
= $880,000 - $550,000 - $80,000 - $50,000 - $100,000
= $100,000 profit.
N.B
Since the North division has been eliminated, all the items for North division would all be ignored except its allocated common corporate cost.
Answer:
a. take advantage of underpriced labor services available in certain developing countries.
b. gain access to special R&D capabilities residing in advanced foreign counties.
c. boost profit margins and create shareholder value.
d. avoid regulations and lower tax burdern
Explanation:
Multinational corporation is a company that operates locally in its home country and also aborad. It usually maintains a central office that coordinates business activities.
MNCs have various advantages which includes:
- taking advantage of lower priced labour in developing countries, for example some companies take advantage of cheap labour in China to produce their goods.
- when a company operates in an advanced economy it will take advantage of research and development there.
- regulations and tax burdens can be avoided by setting up manufacturing plants in countries with low regulatory policies.
- MNCs boost shareholder profits by taking advantage of their multiple locations to gain more profits.
