When One Unit Charges Another Unit in the Same Company

question 138

Multiple Choice

When one unit charges another unit in the same company for goods it ships to its foreign subsidiaries, the charge is called a(n) ________.

• A) original price
• B) transfer price
• C) margin price
• D) break-even price
• E) customer value price

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Definitions:

Apartment Owner

An individual or entity that holds the title to a residential unit in a building.

Prisoner's Dilemma

A paradox in decision-analysis in which two individuals acting in their own self-interest do not produce the optimal outcome.

Nash Equilibrium

A concept in game theory where no player can benefit by changing their strategy while the other players keep theirs unchanged, leading to a stable outcome.

Nash Equilibrium

A concept in game theory where each player is assumed to know the equilibrium strategies of the other players, and no player has anything to gain by changing only their own strategy.