Which of the Following Is NOT a Valid Reason for a Firm

question 6

Multiple Choice

Which of the following is NOT a valid reason for a firm to establish subsidiaries?

• A)to better control risk exposure of either parent-to- subsidiary or subsidiary-to-parent.
• B)to enhance the company's ability to evaluate individual performance and to create different compensation systems for a diverse set of its businesses.
• C)to obfuscate financial reporting.
• D)to conform with regulatory requirements specific to a particular business environment.

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Definitions:

Private Distributor Brands

Brands, which may cost less than manufacturer brands, that are owned and controlled by a wholesaler or retailer.