Which of the Following Is a Reason Why Budgets in Multinational

question 198

Multiple Choice

Which of the following is a reason why budgets in multinational companies are not used to evaluate the firm's performance relative to its budgets?

• A) Evaluations based on budgets can be meaningless due to factors such as exchange rate risk and other volatility.
• B) Evaluations based on budgets are not possible because of cultural differences in the budgeting approach.
• C) Evaluations based on relative regional performance are considered more meaningful as compared to evaluations against budgets.
• D) Evaluations based on budgets are harder when managers use sophisticated techniques to minimize foreign currency exposure.

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