Suboptimization in the MNC Refers to

question 36

Multiple Choice

Suboptimization in the MNC refers to

• A) the local subsidiary ignoring the needs of the larger parent company.
• B) the parent company ignoring the needs of the local subsidiary.
• C) the parent company failing to hire local managers.
• D) the local subsidiary being staffed by all expatriates.
• E) the ease of the MNC in meeting its worldwide objectives.

---

Definitions:

Pay Back

The process of returning or repaying borrowed funds, especially the principle amount of a loan.

Accounting Break-Even

The point at which total costs and total revenues are exactly equal, resulting in neither profit nor loss.

Net Income

The net income of a company once all costs and taxes are subtracted from its revenues.

Internal Rate

Internal rate, likely referring to the internal rate of return (IRR), is a financial metric used to evaluate the profitability of potential investments, representing the discount rate that makes the net present value (NPV) of all cash flows equal to zero.