Which of the Following Is Incorrect About Multinational Corporations

question 62

Multiple Choice

Which of the following is incorrect about multinational corporations?

• A) They sometimes have assets and power greater than those of many governments of lesser developed countries.
• B) They send most of their profits back to their home country.
• C) They sometimes directly exploit lesser developed countries.
• D) They work to better develop the infrastructure of less developed countries so that they can one day compete economically.
• E) They control approximately one third of the world's assets.

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Definitions:

Avoidable Cost

A cost that can be eliminated (in whole or in part) by choosing one alternative over another in a decision. This term is synonymous with relevant cost and differential cost.

Fixed Costs

Expenses that do not change with the level of production or sales activity, such as rent or salaries.

Contribution Margin

This is the amount remaining from sales revenue after all variable expenses have been deducted.

Financial Reporting

The process of providing financial information to company stakeholders to help in making business decisions.