Which of the Following Is a Disadvantage of Using Negotiated

question 99

Multiple Choice

Which of the following is a disadvantage of using negotiated transfer price?

• A) It requires each division manager to put forth effort to increase division operating income.
• B) Negotiated transfer prices take away the divisional autonomy as prices depend on bargaining strength.
• C) Negotiations usually require much time and energy thereby consuming precious managerial time.
• D) It may lead to divisional enmity because negotiation process may cause frictions among departments.

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Definitions:

Cross-Cultural Understanding

The awareness and appreciation of differences and similarities across cultures, facilitating effective communication and interaction in a globalized world.

Cultural Stereotypes

Oversimplified and generalized beliefs about a group of people based on their culture, often leading to misunderstandings or biases.

Multicultural Experiences

Experiences that involve or are related to multiple cultures, aiding in the understanding and appreciation of cultural diversity.

Business Perspective

Viewing issues or strategies from a standpoint that considers the commercial implications and objectives of an organization.