Suzie's Sleds Incorporated Is Considering Establishing a Subsidiary in Japan

question 67

Multiple Choice

Suzie's Sleds Incorporated is considering establishing a subsidiary in Japan.Suzie's has no competition in that particular product segment in the region.In this case,which of the following is the only mode available to Suzie's in establishing a wholly owned subsidiary in the country?

• A)Franchise.
• B)Acquisition.
• C)Joint venture.
• D)Green-field venture.

---

Definitions:

Sunk Cost

Costs that have already been incurred and cannot be recovered or reversed.

Incremental Overhead Costs

Additional overhead expenses directly resulting from a specific business decision or activity.

Relevant Costs

Costs that should be considered when making decisions because they will be affected by the decision.

Markup Percentage

The percentage difference between the cost of a good or service and its selling price, indicating the gross profit margin.