When There Is No Intermediate Market

question 17

Multiple Choice

When there is no intermediate market:

• A) there is no optimal transfer price.
• B) the selling division cannot transfer its goods internally.
• C) the buying division cannot purchase its goods externally.
• D) there is no reason for top management to intervene in transfer pricing disputes.

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Definitions:

Sales Contract

A legally binding agreement between a seller and a buyer specifying the terms of sale for goods or services.

Market Price

Market price is the current price at which an asset or service can be bought or sold in the open market.

Entire Contract

The complete and final agreement between the parties, often found in insurance policies, indicating that all agreements and terms are contained within the contract document.

Contractual Remedy

A legal solution designed to address a breach of contract, aiming to compensate the injured party.