How Is a Foreign Subsidiary Different from a Foreign Branch

question 22

Multiple Choice

How is a foreign subsidiary different from a foreign branch of a domestic corporation?

• A) Subsidiaries always generate more foreign source income than branches do.
• B) The subsidiary is a company incorporated in the foreign country, whereas a branch is not a separate corporation.
• C) A subsidiary is created to manufacture and distribute products in foreign markets, whereas a branch's only function is sales in the foreign market.
• D) The income of a subsidiary is taxable by the country where it is located, but branch income is not subject to tax by the country where it does business.

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Definitions:

Group Development

The phases or stages through which a group progresses as it matures, including forming, storming, norming, performing, and adjourning.

High Performance

A state of achieving or exceeding the expected or required standards in a specific task or field.

U.S. Hockey Team

Refers to various ice hockey teams representing the United States in international competitions, including the Olympic teams and World Championship teams.

Stage Of Development

A period in the growth or evolution of something, often used to describe phases in human psychological or physical growth.