Despite the High Expenses Associated with Operating Elegant Stores and Purchasing

question 96

Multiple Choice

Despite the high expenses associated with operating elegant stores and purchasing advertising space in upscale magazines,the premium retail prices that luxury goods like Louis Vuitton command translate into handsome profits.The Louis Vuitton brand alone accounts for 60% of LVMH's operating profit.On the other hand,Louis Vuitton SA spends $10 million annually battling:

• A)EU regulations.
• B)counterfeiters in countries such as Turkey,South Korea,& Italy.
• C)competitors in European countries.
• D)suppliers of needed materials.
• E)export freight and taxes.

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Definitions:

Sarbanes-Oxley Act

U.S. legislation enacted to protect investors from fraudulent financial reporting by corporations, enhancing corporate accountability.

SEC

The Securities and Exchange Commission, an agency responsible for regulating and enforcing federal securities laws in the United States.

Criminal Penalties

Sanctions imposed for violations of criminal law, which can include fines, imprisonment, or other forms of punishment.

1933 Securities Act

U.S. legislation that requires the registration of securities and disclosure to protect investors from fraud in the securities market.