Which of the Following Statements Is True About Privatization

question 98

Multiple Choice

Which of the following statements is true about privatization?

• A)The privatization movement started in China in the early 1980s.
• B)Privatization involves replacing a state-owned monopoly with a private monopoly.
• C)For privatization to become successful,countries should adopt communism.
• D)When newly privatized firms are extensively protected from foreign competition,they have little incentive to restructure their operations to become more efficient.
• E)In today's context,a country runs the risk of experiencing a serious economic crisis if it liberalizes and privatizes state-owned enterprises.

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Definitions:

Joint Costs

Expenses incurred in the process of producing two or more products at the same time, which cannot be easily attributed to individual products.

Split-off Point

The stage in a production process where multiple products become separately identifiable, often leading to different processing streams.

Value Basis

Value Basis refers to the method or groundwork for assessing the worth or value of assets, often used for tax or financial reporting purposes.

Joint Cost Allocation

The process of distributing the costs of producing two or more products from the same process where those costs cannot be directly assigned to each product.