One Argument for Why Subsidiaries Should Be Wholly Owned by the MNC

question 5

Multiple Choice

One argument for why subsidiaries should be wholly owned by the MNC parent is that parent ownership avoids a potential conflict of interest between the:

• A) parent's managers and board of directors.
• B) parent and managers at the subsidiary who are minority shareholders.
• C) parent and existing creditors.
• D) subsidiary's managers and creditors.

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Definitions:

Sensory Stimulus

A detectable change in the internal or external environment that elicits a response from the sensory system.

Sensation

The process of receiving and interpreting sensory information through the senses.

Perception

The process of organizing, interpreting, and giving meaning to sensory information.

Chemo

Short for chemotherapy, a type of cancer treatment that uses one or more anti-cancer drugs as part of a standardized chemotherapy regimen.