The Use of Dividends Is a Method by Which a Foreign

question 249

True/False

The use of dividends is a method by which a foreign subsidiary can remit cash to its parent company.

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Definitions:

Savings

The portion of disposable income not spent on consumption of goods and services, often placed in a deposit account.

Disposable Income

Funds apportioned to households for saving and spending after the settlement of income taxes.

Consumption

Domestic consumption of goods and services by households.

Autonomous Consumption

The level of consumption that occurs when income is zero, reflecting the basic level of spending necessary to sustain life.