Many Firms Find It Advantageous to Organize as a Set

question 23

Multiple Choice

Many firms find it advantageous to organize as a set of separate legal entities or subsidiaries because of all of the following reasons except:

• A)it limits their total legal liability.
• B)to take advantage of corporate tax regulations.
• C)of legal requirements in the countries in which they do business.
• D)subsidiaries are all separate economic entities.

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Definitions:

Profit-Maximizing Price

The price at which a firm can sell its product to earn the maximum possible profit on those sales.

Marginal Revenue

The additional income from selling one more unit of a good; it is the change in total revenue from an additional unit sold.

Marginal Revenue

The increase in revenue resulting from the sale of one additional unit of a product.

Maximum Level

The highest or utmost point, degree, or volume of something that can be achieved or reached.