Which of the Following Is an Additional Question to Be

question 4

Multiple Choice

Which of the following is an additional question to be asked in determining whether a foreign entity's functional currency is the same as that of the reporting entity?

• A) Are the transactions with the reporting entity a high or low proportion of the foreign operation's activities?
• B) Are the foreign operation's activities carried out as an extension of the reporting entity, rather than being carried out with a significant degree of autonomy?
• C) Do the cash flows from the foreign operation's activities directly affect the reporting entity's cash flows?
• D) All of the above.

---

Definitions:

Production Function

An equation or graph that shows the output generated from different combinations of inputs, usually focusing on labor and capital.

Marginal Product

The increase in output that results from an additional unit of input.

Returns to Scale

Refers to the rate at which output increases as inputs are proportionately increased, categorizing into increasing, constant, or decreasing returns.

Carpet Industry

The sector of the economy specialized in the manufacture and sale of carpets and rugs.