Which of the Following Is Not a Reason Why a Parent

question 21

Multiple Choice

Which of the following is not a reason why a parent company would prefer to be involved with an NCI?

• A)Reduction on ownership risk
• B)Potential for increased share dilution
• C)Maintenance of a market for the subsidiary's shares
• D)Potential links to resources such as government support and management expertise

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Definitions:

Assessing Risk

The process of identifying and evaluating potential risks and their impact on a project, organizational objective, or activity.

Risk Mitigation

Strategies and methods implemented to reduce the severity, impact, or likelihood of potential risks to a project or organization.

Risk Evaluation

The process of identifying, assessing, and prioritizing risks to an organization or project, followed by coordinated efforts to minimize or manage the impact of these risks.

Risk Management

The process of identifying, assessing, and controlling threats to an organization's capital and earnings, including both strategic and operational risks.