Which of the Following Is a Disadvantage of Wholly Owned

question 26

Multiple Choice

Which of the following is a disadvantage of wholly owned subsidiaries as a mode of entry into foreign markets?

• A)Lack of control over quality
• B)High costs and risks
• C)Problems with local marketing agents
• D)Inability to engage in global strategic coordination
• E)Lack of control over technology

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Definitions:

Variable Manuf. Overhead

Indirect, variable costs incurred during the manufacturing process, excluding direct labor and direct materials.

Labour Efficiency Variance

The difference between the actual labor hours used and the standard labor hours expected, multiplied by the standard labor rate.

Direct Labour Used

The total effort, measured in hours or costs, of workers directly involved in the manufacturing process of a product.

Variable Manuf. Overhead

Costs that vary with production volume, such as utilities and materials used in manufacturing.