A Company That Controls Finances in the Home Country and Decentralizes

question 78

Multiple Choice

A company that controls finances in the home country and decentralizes production, sales, and marketing operations to other countries is using a ________ strategy.

• A) domestic exporter
• B) franchising
• C) transnational
• D) multinational

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Definitions:

Production Capacity

The maximum volume of products or services a company can produce under normal working conditions.

Target Costing

A pricing method where the selling price of a product is determined first, and then production costs are managed to ensure the product can be produced within that target cost.

Variable Product Cost

Refers to the costs that vary directly with the level of production output, including costs like raw materials and direct labor.

Contribution Margin

The amount remaining from sales revenue after variable costs have been subtracted, used to cover fixed costs and to generate profit.